- The Great Resignation refers to the massive employee exodus in 2021 due to pandemic-induced work-life balance reassessment.
- Businesses suffer talent loss, increased hiring costs, productivity decline, negative cultural impact, and missed growth opportunities.
- The turnover is causing significant disruptions, with businesses incurring expenses to replace leaving employees and facing productivity challenges.
- The employee departures tarnish company culture and limit growth opportunities as key skills and relationships exit with them.
- Preventive measures include hiring recruitment specialists, offering competitive remuneration, flexible work arrangements, and fostering a positive, inclusive workplace culture.
The Great Resignation is a term coined to describe the recent mass exodus of employees from their current jobs, as the pandemic has caused a major shift in priorities for many people. While this may seem like a positive development for those who seek better work and more flexibility, it is causing specific damage to the employers. In the long run, it can cripple businesses trying to keep up with the pace of the modern world. Here’s what you need to know about the Great Resignation, how it’s affecting your business, and how to avoid it.
The Great Resignation
The Great Resignation happened in early 2021 as the COVID-19 pandemic forced many companies to shift towards remote work. This transition led to people realizing that they can work from anywhere and have more control over their work-life balance, leading them to reassess their current jobs. As a result, many employees started quitting their jobs in search of better opportunities or simply choosing to prioritize other aspects of their lives.
The Impact on Businesses
The Great Resignation is causing major disruptions for businesses across industries, and its effects still affect companies. Here’s how it’s impacting your business today:
1. Loss of Talent and Skillset
The first and most obvious way the Great Resignation costs businesses is by losing top talent with critical skills. These skilled professionals are often irreplaceable, and may take years to train a new person to do what they have been doing. The turnover rate results in companies losing talent and knowledge they may not be able to retrieve easily.
2. Increased Hiring Costs
The second way the Great Resignation costs businesses is through increased hiring costs . Filling a vacancy in a company involves several stages, including advertising for the opening, sorting the resumes, scheduling interviews, and verifying the background of the applicants. As companies seek to replace employees who are leaving, they incur added costs for job postings and hiring many candidates, which can stretch the business’s budget.
3. Loss in Business Productivity
The third way the Great Resignation is costing businesses is through a loss in productivity. Businesses are built on teamwork and collective efforts. When team members resign, remaining team members face a backlog of work and new tasks they may not be familiar with . This can lead to a decline in productivity and morale within the team, which can adversely affect the business’s performance.
4. Negative Impact on Business Culture
Another way the Great Resignation costs businesses is the negative impact on a company’s culture. The departures of esteemed employees can lead to others feeling like there is little opportunity for growth or development within the company. This can further lead to added frustration and declining morale amongst the team. As a business owner, it is essential to prioritize the needs of employees and create a working environment that promotes growth and stability.
5. Growth Opportunities Missed
The fifth way the Great Resignation costs businesses is through missed growth opportunities. When employees leave, their skills, experience, and relationships may leave with them. This can limit opportunities for the company’s growth and expansion . By keeping a loyal, diverse, and skilled team, businesses can continuously build on these relationships and grow their networks to capture more diverse customers and clients.
How to Avoid the Great Resignation in the Future
As a business owner, it’s crucial to recognize and address why employees resign. Some steps that can help avoid the Great Resignation in your company include:
Hire Recruitment Specialists
If employees leave your company then it’s important to have professionals that can help you replace them. Commercial recruitment specialists are skilled at finding the right candidate for a specific job, which can save you time and money in the long run. They can help deal with attrition and prevent the Great Resignation from causing significant disruptions in your business.
Offer Competitive Remuneration Packages
It’s no secret that employees are more likely to leave if they feel undervalued or underpaid. To avoid losing valuable talent, offering competitive remuneration packages that reflect the market rates and recognize employee contributions is essential. This will help retain current employees and attract new talent to your company.
Offer Flexible Work Arrangements
Flexibility has become a top priority for many employees after the pandemic. By offering flexible work arrangements, such as remote work options or flexible schedules, businesses can cater to their employees’ changing priorities and retain valuable talent.
Create a Positive and Inclusive Workplace Culture
Creating a positive and inclusive workplace culture is crucial for employee retention. By prioritizing the well-being and growth of employees, businesses can foster a sense of belonging and loyalty within their team. This can help prevent the Great Resignation from happening in your company.
The Great Resignation has had significant effects on businesses, but by understanding its causes and taking proactive measures, businesses can avoid future mass exodus of employees. Prioritizing employee satisfaction, offering competitive remuneration packages, and fostering a positive workplace culture are key steps that can help retain valuable talent and prevent the negative impact of the Great Resignation on businesses.