The Great Resignation – Fact or Fiction
The media is full of talk about the Great Resignation, a consequence of the COVID fallout. The theory is that with the lifting of lockdowns and the removal of restrictions there will be an unprecedented number of people choosing to resign from their current jobs. Of course, the Great Resignation theory originates from the USA where statistics from surveys are readily available. Both the U.S. Bureau of Labor Statistics and Microsoft have completed large surveys of the phenomenon.
According to the U.S. Bureau of Labor Statistics, 4 million American’s quit their jobs in July 2021. Resignations peaked in April and have remained abnormally high for the last several months, with a record-breaking 10.9 million open jobs at the end of July.
Microsoft reported that 41% of the global population is planning to leave their current role within the next year and 46% want to make a significant transition in the career.
The Causes of the Great Resignation
The Great Resignation may not affect Australia and I hope it does not. However, the causes behind it in the US certainly have reached Down Under and local organisations must prepare themselves or at least think about it, just in case.
There is no doubt that the causes spring from the COVID pandemic.
In many cases, COVID-19 affected how, when and where people worked. The long absence from their normal place of work has caused people to revaluate their relationship with their employer, the office workspace and work colleagues.
Many people found that working from home (WFH) had its advantages and attractions. Being at home with children, working at times of you own choosing, avoiding the time and cost of long commutes to and from a city office are examples.
It is reported that the downside issues of WFH is loneliness, burnout, and mental health. The latter seems to be a fad these days.
Industries Most Affected
According to a report by CCIQ, a survey by McKinsey that encompassed people from Australia, Singapore, the United States, Canada and the United Kingdom, found that the industry with the highest expected turnover is Leisure and Hospitality. If this report is correct, then it is certainly a warning sign for many businesses in North and Far North Queensland.
However, research in the US identified dramatic differences in turnover rates between companies in different industries. While resignations decreased slightly in industries such as manufacturing and finance, 3.6% more health care employees quit their jobs than in the previous year, and in tech, resignations increased by 4.5%. In general, it was found that resignation rates were higher among employees who worked in fields that had experienced extreme increases in demand due to the pandemic, likely leading to increased workloads and burnout.
If the Great Resignation fad does affect Australia, it would seem logical to me that the demographic and professions most likely to experience increased resignations will be the young, under 35-year-olds, in easily transferable skills such as IT, finance, health, and hospitality to name a few.
Hopefully, the Great Resignation experience in the US will not find its way Down Under. However, given that we seem to copy everything American the likelihood is that it will come here to a degree.
Young professionals who have had their freedom to travel taken from them for the past two years are likely to react by resigning from their current jobs and boarding an aircraft to London or elsewhere. That is to be expected due to the pent-up demand caused by excessive lockdowns.
All businesses should at least be giving some thought to the Great Resignation phenomenon and doing a few ‘What Ifs”.