It wasn’t too long ago that millions of laid-off and furloughed employees were frantically searching for a job — any job. Now, within one short year, millions of employees are leaving those same jobs searching for something else.
According to the U.S. Bureau of Labor Statistics, 4.4 million people quit their jobs in September of this year alone. That’s 3% of the U.S. workforce! August wasn’t too far behind with 4.3 million people deciding the grass may be greener elsewhere. This mass exodus is speaking volumes, without saying a word — the sound of doors closing behind employees says it all. But are employers listening?
The Great Resignation, as it is now referred to, signifies a drastic shift in the workplace narrative. It leads to two critical questions:
1. Why are so many employees quitting after desperately seeking work only one year ago?
2. What are employers going to do about it?
The reasons for leaving are seemingly plentiful. Mindsets have shifted due to the larger effects of the pandemic, affecting how employees view their jobs, family time, flexibility, and appreciation. Some employees are rethinking their daily routine — one without a long commute. Others think about flexibility to help handle childcare issues or caring for aging family members. Many are just completely burnt out. Pre-pandemic issues still linger as well: unhappiness with current company culture, opportunities for advancement (or lack thereof), or compensation packages.
Whatever the reason, the recovered economy coupled with this shift in mindset has given employees all the confidence they need to risk their paycheck while searching for another job.
There were 10.4 million job openings at the end of September. That’s a lot of leverage for employees. As we may remember from early Economics classes, it comes down to supply and demand. The number of well-paying jobs is far outnumbering the number of the unemployed, increasing confidence among employees and improving bargaining positions.
With more very real (and maybe some perceived) available opportunities, employees seem to have the freedom to explore solutions to any current challenge at work. They are less likely to “just deal with something” in their workplace because “they have to.” Because, quite frankly, they no longer need to.
After so much uncertainty in their personal and professional lives, candidates and employees are longing for something certain. Something that is clear and expected. Something on which they can count. And one area that is often unnecessarily fraught with uncertainty is compensation structures.
Employers can look at the Great Resignation as an opportunity. A well-developed and clearly communicated compensation structure is a strong competitive advantage in this overly saturated job market. There is no doubt that candidates have higher expectations. The key is making your compensation structure a critical component of the overall candidate/employee experience to meet those expectations from the outset.
“Align all the pieces of your compensation plan in a way that inspires talented candidates to join and stay with your organization for the right reasons.”
Ready to reimagine your compensation structure to stay competitive in today’s hiring market? Download our guide to get started.
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