March 21, 2022
Over 33 million Americans quit their jobs in 2021. There is currently a worldwide pattern of people voluntarily leaving their employment. This has led to a rash of articles about “The Big Quit,” many of them promising to give the reason why this is happening. There are a number of factors making it more possible for people to resign from their current positions. Some are new, and many of them have been around for decades.
We strongly argue, however, that no one reason explains the Great Resignation. An economist would argue that the simple fact is that there are 10.1 million unfilled jobs, and there are 7.4 million unemployed workers in the US economy. But the overall economy is lumpy. Turnover is higher in food service, hospitality, retail, and health care. Individuals who are mid-way in their careers have a higher incidence of voluntarily resigning than those who are earlier or later in their careers.
Inflation is increasing; many employees, especially with low-paying jobs, are looking for an increase in their pay. Government safety-net programs have given many people financial assistance to weather the pandemic, which has made them more willing to consider changing their employment. The pandemic had caused a major decline in job mobility in 2020, which likely caused a pent-up interest in moving to better employment.
The fact that a sizable portion of the workforce, primarily the white-collar and professional staff, was forced to work remotely from home caused them to see the benefits of that way of working. At the same time, it caused organizations to see that productivity would not fall off the cliff. Companies suddenly realized this could result in dramatically lower costs for office space.
As employees experienced working from home, other factors emerged, such as they liked the change. Some people say a change is as good as a holiday. Then many saw that they could work from anywhere. That could be a beach cottage or a cabin in the mountains. Location was no longer a constraint.
Some estimates are that 12% of workers experience their job as a grind, so doing something new and different can be satisfying. For most people who quit, there are also some push factors in their current job. Push factors are a poor physical work environment in which they lack proper equipment, or it could include having to wear a mask all day. It could also be a psychological issue, in which the employee does not feel included or respected. This can also involve a lack of promotional opportunities.
While engagement increased for some employees in the pandemic, for ineffective leaders’ engagement has declined. The number one biggest factor influencing people to quit their job continues to be the behavior of their immediate supervisor or manager. This has become significantly more pronounced in the pandemic.
While the daily interaction and amount of communication have often decreased, the manager continues to be the key link for the employee to the organization. Unfortunately, many employees think it has become an “out of sight, out of mind” phenomenon.
The development of managers has suffered a huge decline during the pandemic. There was roughly a two-year period in which little development took place. While new and more personal interaction was needed, organizations were scrambling to find ways to provide practical development using virtual technology.
During the pandemic, we gathered data from 17,134 direct reports. Each direct report rated their manager’s effectiveness on 60 behaviors that have been found in our research to best differentiate great from poor leaders. In addition to these ratings, each direct report indicated the extent to which they have “Thought about quitting their job and going to another organization.” In the graph below, we show the effectiveness of 3,314 managers based on the overall average of the 60 behaviors measured. The bars in the graph represent the percentage of direct reports who responded negatively or neutrally to that question. Note that the worst managers (those in the bottom 10%) had 49% of their direct reports thinking about quitting. We have found in previous research that this percentage is highly correlated with turnover in an organization. Typically, the percentage of people who actually quit is about 50% of the percentage thinking about quitting.
Looking at the data we gathered in the pandemic, we analyzed the top behaviors significantly correlated with the intention to leave. Many of these behaviors had increased importance in the pandemic relating to the personal relationships between managers and team members. It is very clear that poor performance on these behaviors pushes team members out the door and increases turnover significantly.
Most people have had the negative experience of working for a very ineffective leader. They know they were dissatisfied, frustrated, and unmotivated. The big problem is that very few poor leaders recognize they are the problem. They believe that they are okay leaders but not poor. We know that the best way to help leaders understand whether they are great or terrible is to provide them with 360-degree feedback every few years. While it is clear the poor leaders do not know they are ineffective, their direct reports and peers see the problem instantly. We know that poor leaders can improve, but like anyone who is lost, they need directions. During the pandemic, development activities have decreased for many organizations. The stresses introduced by the pandemic have significantly increased the need. As many organizations migrate to having more employees working remotely, it’s clear the managers need to develop new skills to remain effective. We know from our research that the best way to reduce turnover in your organization is to make a concerted effort to improve the effectiveness of every manager and supervisor.
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(This article first appeared on Forbes)
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