When a tsunami hits, its force can sweep away the foundations a house is standing on. The same can be said for the Great Resignation Wave, which left numerous companies in the lurch as workers left in droves.
‘The Great Resignation’ was a term coined by organisational psychologist Anthony Klotz, in an attempt to explain the exodus of workers during the ongoing pandemic. At its peak, a whopping 4.5 million workers were recorded leaving their jobs in the United States. Singapore too recorded a rise in the number of people leaving their jobs, albeit to a smaller extent, according to Dollars and Sense.
It’s a scenario no company will want to be left in. After all, losing a C-suite executive can cost a company up to 213% of the employee’s salary. Meanwhile, losing employees in technical positions will cost companies approximately 100 to 150% of their salary.
The costs aren’t just monetary either. Losing a staff can also lead to a drop in the productivity, engagement, and motivation of the remaining employees. This is only exacerbated if multiple people are leaving at a time.
But how can companies retain staff amidst a tumultuous landscape? Well, employers will first need to understand the ‘why’ behind staff departure, before they generate the ‘how’ to incentivise them to stay.
Why are employees leaving?
Consulting firm McKinsey & Company conducted a research study in 2021 on the factors driving the Great Resignation. Their survey interviewed over 5,000 employees and 250 employers across Australia, Canada, Singapore, the United Kingdom and the United States.
What they found was that employers often do not fully comprehend why employees leave. Employers tended to cite more pragmatic reasons such as inadequate compensation and the ability to work remotely as important reasons for employee resignations; however, employees placed a higher value on relational factors such as the sense of belonging or feeling appreciated at work.
In fact, employees rated not being valued by organisations and managers as the top two reasons why they would leave a company. Of slightly lower priority then comes the more pragmatic considerations such as work-life balance, compensation, and potential for career advancement.
McKinsey’s research revealed a clear misalignment between what employers believe their staff values, and what their team actually values. Bridging this gap can help employers better understand what they need to change in order to best retain top talent.
Transforming the Great Resignation, to the Great Retention
First and perhaps most importantly, employers need to start improving the relational factors within a company. While this list is by no means exhaustive, here are three steps that employers can take to better retain talent during this pandemic:
1. Show appreciation readily
Many employees leave their jobs because they feel undervalued. Employers can take the first step by showing recognition and appreciation when employees are doing well. There are several ways that employers can do this.
First, through tangible rewards and processes. Employees performing outstandingly on their performance reviews, for instance, can be rewarded through larger bonuses.
Another way employers can display their appreciation is through more intangible and personable means. This includes public channels where employers can share public appreciation for staff members, or even verbal words of affirmation when employees complete a task well.
2. Employee engagement
Employees want to feel a sense of belonging in the workplace. On an organisational level, companies need to put in place strong diversity and inclusion practices to ensure that every community feels represented and valued.
Gartner recommends managers to provide routine opportunities to check in with employees and to incorporate official channels where employees can have their voices heard. This can include official feedback channels to the HR department, regular town hall sessions, or just building an open-door culture where employees are not afraid to voice their thoughts
3.Provide opportunities for growth and development
Providing career development opportunities today is more important than ever before. A whopping 87% of millennials believe that learning and development in the workplace is important; likewise, 76% of Gen-Zs see learning as key to career advancement.
In fact, 94% of employees say that they will stay longer at a company if it invested in their career, according to LinkedIn’s 2018 Workplace Learning Report; on the flip side, more than 80% of employees would quit their jobs for better development opportunities, as reported in a previous Charterhouse article.
Having a formal, stepladder approach to career development; providing an abundance of training opportunities; and having regular performance review and promotional opportunities in place are thus key to keeping employees motivated and happy in their jobs.
Let Charterhouse help you turn the Great Resignation into the Great Retention. Reach out to us today for any advice or solutions you may need!