Learning & Development Blog

The Great Resignation

The Great Resignation: What It Is and What Your Organization Can Do

It’s pretty simple to understand. Millions of people across the nation have been quitting their jobs. This phenomenon, as some have called it, describes a record number of people leaving their job during and after the breakout of the pandemic. Companies everywhere are fighting to navigate the rippled effects and reevaluate their job search and talent strategies. The “Great Resignation” is a theory developed by Professor Anthony Klotz of Texas A&M University, in which he predicted large sums of people leaving their professions after the pandemic ceased and life returned to “normal.” His theory was based around the fact that a lot of people were experiencing “pandemic-related epiphanies” such as more family time, working remotely, finding passion in hobbies and projects, etc. This in turned caused people to resent going back to their regular 9-5 jobs.

Understanding the Great Resignation

According to the U.S. Bureau of Labor Statistics, 4 million Americans left their jobs in July 2021 alone. The resignations began to peak in April of that year and have remained steady and unusually high ever since. What does this mean? It means that back in July, over 10 million jobs were available. Companies everywhere are struggling to retain employees, along with hiring replacements. The best way to find the root cause of the Great Resignation is to truly understand what’s causing it and who is driving the dramatic shift in jobs. Below you’ll find some statistics provided by Harvard Business Review, along with some myths about this current job climate.

Resignation Rates are Highest Among Mid-Career Employees

The most resignations received have been in the mid-level career age of 30-45. According to HBR, there was a more than 20% increase between 2020-2021. Typically, turnover tends to be higher in younger employees, under the age of 25. One theory for these mid-level career resignations is that the shift to remote work has caused upheaval and uneasiness, as hiring people with less experience would be more difficult for onboarding and development, as newer employees won’t have in-person guidance or training.

In my humble opinion, I think it’s possible that a lot of people in these mid-level roles may have just prolonged a decision they were already contemplating and delayed leaving their current job because the havoc and uncertainty that the pandemic caused. Why leave a job during the biggest upheaval in the economy since the Great Depression? The other side of this is that a lot of employees are experiencing outside factors and pressure from working remotely (I get it, I experience this as well) and this causes them to rethink their overall career goals and future.

Resignation Rates are Highest in the Technology and Health Care Fields

I think this one is pretty self-explanatory, don’t you? HBR found that resignation rates were the highest in roles that experienced extreme increases in workloads due to the pandemic. This is no surprise because increased workloads lead to more tasks, more stress, and eventually, burnout.

At the beginning of the pandemic, the job market was already full of uncertainty and mass layoffs. I was even a part of the second round of layoffs at my last employer, to which I might add, I am extremely grateful for at the current time. But now that the economy and job environment are returning to “normal,” employees who are more privileged and don’t live paycheck to paycheck are finding the courage and resolve to just move on. Nonetheless, employees who don’t have the luxury of leaving their current job are burnt-out, stressed, and some are even downright depressed.



Let’s Discuss Some Myths About the Great Resignation

First off, a lot of people assume the Great Resignation is just about quitting their jobs. While that is true to some extent, it’s really about lower-wage employees finding better jobs. Why is this happening? Because as we mentioned above, those “better jobs” are now opening up and hiring because employees left. This in turn causes organizations to offer higher wages to fill these open positions faster. Some may consider this “phase” in the job economy to be more of a “big switch” than a “big quit.”

Secondly, a lot of people are hearing that the great resignation is all about white-collar employees just getting burnt-out. Yes, burnout has remained continuous for most people during the pandemic; however, remote employees are significantly more likely to say they are burnt-out now, compared to before the pandemic hit. Since a lot of the remote employees are from white-collar roles, it has led to more coverage in the news than a lot of other jobs. However, there has not been a significant increase of resignations in industries such as finance, real estate, software, or internet-based companies. But hospitality increased over four times quicker than the largest white-collar sector.

Lastly, the Great Resignation is not about just burnout syndrome, and it’s also not just about people getting up and quitting their jobs. According to HBR, the Great Resignation is a combination of those issues mentioned above, along with a period for low-income employees to switch to better paying jobs, while also incorporating a slight rise in early retirements. Remember? Family, friends, hobbies…

Organizations Need a Better Plan for Improving Retention

Everything we’ve discussed proves that organizations need to have a better plan in place for how many employees are quitting. Before you’re able to really understand the root causes in your organization, you need to look at the scope of the issue and the impact. Consider conducting a detailed data analysis and explore metrics such as compensation, promotion opportunities, size of salary increases, tenure, performance, and especially, training and development opportunities. Another thing to consider is location and function of your employees, and segment them into categories and demographics to better understand work experiences and retention rates, and how they differ across your departments and organization.

One thing your organization may want to implement is a customized retention program for your employees. Focus on remedying the specific issues that your organization, and employees, struggle with the most. Dashe is always hear to consult on any specific needs your organization might have, including change management, technology adoption, and onboarding.

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