Do you have employees quitting at an alarming rate? In the United States, there has been a tidal wave of resignations in recent years. We’ve all seen help-wanted signs and experienced slow service at our favorite restaurants within the food service sector. However, occupational absences are typical across numerous industries.
What can businesses do to combat the so-called “Great Resignation,” or as some are calling it, the “Big Quit,” and the “Great Re-negotiation” of the 21st century? This job market withdrawal is a modern phenomenon disrupting the labor pool.
It raises more questions than answers in the context of a strained U.S. economy where small business owners have suffered the most. Where are all these people going? How can they afford to quit? Why is the working class leaving in droves, and most importantly, how can you outrun the great resignation and retain quality business growth in 2022?
The great resignation statistics
According to the U.S. Bureau of Labor Statistics, job departure spiked in April 2021, and by July 2021, over 4 million people had quit their jobs in the United States, jumping more than 20% than in 2020.
In September 2021, the number of quits increased by 164,000 to a historic high of 4.4 million former employees. Jobs continued vacant as 10.9 million businesses were looking for workers in December alone.
Data shows that December of 2021 saw 4.3 million people quit their jobs, following a series high in November. Millions of people went on to apply for unemployment benefits and other forms of government aid.
How many people quit their job in 2021?
A record 38 million American workers - and counting - have quit their jobs since April of 2021 (minimum), and overall resignation rates were highest amongst mid-career employees.
What is the great resignation?
Ignited by the COVID-19 pandemic, many people found themselves in precarious situations with their jobs, leaving companies to handle the costly repercussions. We were all forced to rethink how to retain top talent, manage a new contingent workforce, and choose the best tools to facilitate that change. It wasn’t that the workforce never planned to return or only wanted to work from home but that they were looking for a good enough reason to stay.
What is the reason for the great resignation: Are Americans still quitting their jobs?
During the height of the pandemic, millions of employees left jobs for increased pay, better benefits, or out of fear of contracting COVID-19. Others departed over childcare issues, to care for elderly relatives or unleash their entrepreneurial dreams.
Priorities have already shifted, with several factors contributing to employees opting to walk away from 40-50 or 60-hour work weeks. People are yearning for flexible freelance work, remote work options, or no work at all, and have displayed overall disdain for in-office politics, toxic work culture, and crippling micromanagement.
The working community is taking a closer look at sustainable, well-being-centered employment opportunities. So, companies are left to examine how workers feel about their roles, to retain quality talent, and sometimes that means hiring these people out as 1099’s. Companies that don’t account for a growing decentralized economy of workers might be left behind.
Worksome technology allows for the compliant hiring and management of this growing global contingent workforce. Isn’t that what the people are asking for after all? The writing has been on the wall following a historic number of people walking away from what can be considered stable (a job) and toward a new kind of stability called mental health.
Is the great resignation still happening in 2022?
“At the nationwide level, the number of Americans quitting their job is higher than ever.”
-Kim Kimbrough, Chief Economist for LinkedIn Corporation
Recently CBS did a 60-minutes interview with LinkedIns’ Chief Economist Karin Kimbrough where she stated, “I think actually that this trend towards having more flexibility could be permanent.” So, platforms like Worksome are an excellent option for businesses looking to retain a workforce that increasingly thirsts for flexibility, on-time payments, and easy, done for your processes.
Kimbrough shared LinkedIn’s data for who’s leaving jobs, noting that “millions of baby boomers are retiring early, but also… in all,” LinkedIn data shows “the highest “quit rate” since the government started keeping track two decades ago.”
Most economists would tell you that quitting is usually a sign of optimism. Nonetheless, the 2021 exits occurred in the context of a larger economic picture. The government provided bailout funds to assist people in weathering the worst of Covid, but much of that money is gone now.
Inflation has resulted from the money printing for stimulus checks, and now, we see talent reentering the market – many as self-employed freelancers, contractors, consultants, and giggsters.
Will more Americans quit in 2022?
Resumebuilder.com took a poll of 1,250 American workers regarding their employment plans for 2022. Shockingly, 52% anticipate quitting in the first half of 2022, 26% plan to leave by March, and 9% have already found new jobs.
Undoubtedly more hybrid workers will seek to enter into the freelance market.
Worksome Co-founder and CEO Morten Petersen notes that “almost three quarters of freelancers (74%) described themselves as feeling happier as a freelancer than as an employee. Three out of five (59%) described themselves as having more economic freedom as a freelancer than as a permanent employee. In addition, a high percentage (72%) said they had more time with family as a freelancer – despite the long hours.”
How to retain talent: Will a great raise follow the great resignation?
Many companies struggle because they do not understand why their employees are leaving in the first place and resort to well-intentioned quick fixes that fail.
For example, increasing pay or adding financial perks, such as bonuses, without making any effort to strengthen employee relationships results in a transactional relationship over gratitude. Staff needs continue unmet or ignored in many cases and can lead to workplace resentment over long hours, lack of appreciation, and a slew of other criticisms—birthing forums like the popular anti-work thread on Reddit.
Companies can gain an advantage in the fight to attract, develop, and retain the quality people they need to build a post-pandemic organization by hiring more freelance-type workers. Freelancers cost less than their full-time counterparts, allowing for built-in “raises.”
Offices are dying and corporate buildings go empty
What about office buildings in the United States? Hiring the remote crowd saves you money, disposing of overhead costs, but the corporate real estate industry has suffered. This vacancy leaves many to wonder if the office market is dead, with more people opting for bedroom desks, living room offices, and kitchen conferences.
The CEO of Slack, Stewart Butterfield, asked: “if we say that everyone must return to the office, or we expect people to, and one of our competitors says you can work remotely, who wouldn’t take the second option there?” Indicating that accepting remote work and hiring freelance teams is becoming the societal norm.
How to maintain business growth
Employers are not inherently neglectful of their employees but often don’t know how to transition into scalable remote work using quality freelancer management. Flexible work is the new top incentive for recruiting choice talent worldwide. Therefore, we see businesses charged with finding solutions for managing this new working class.
Worksome provides the only all-in-one freelance management software to identify, classify, engage, and payroll your independent workforce. Our tools support business growth, and we don’t charge monthly fees or have sign-up costs.
Consider implementing these 3 workforce retention strategies:
These tactics can help you keep the best individuals, boost morale, and unlock untapped talent pools.
- Stop burnout
Employees are dealing with exhaustion after a turbulent few years. The pandemic’s nature has stretched many people who require coping mechanisms even at work.
When employees depart due to burnout, work typically shifts to those who stay, causing even more potential breakdowns. Moving to hire more freelancers can alleviate this problem.
- Invest in workplace well-being
Remember that workplace well-being can reenergize an organization, which includes flexible workers. Creating a sense of belonging and feeling appreciated is the key to strengthening links with employees.
Organizational health refers to the vibrancy and endurance of institutions that can maintain high performance and mental health. The healthiest businesses go above and beyond to achieve peak level performance breeding thriving employees and happy remote teams.
- Improve your current assets – your people
The most accessible talent to find is the talent you already have. Training and encouragement can be the correct answer to “finding” the skill sets you need.
Tapping into a thriving freelance economy
The freelancing industry is booming as workers have become more demanding of how, when, and where they work. As more top talent goes freelance, if you’re only working with full-time employees, you could be doing your company a disservice.
If you do work with freelancers, you can really optimize your freelance management program with an FMS by automating admin work and creating a smooth freelance hiring and management process.