The Great Resignation may be upgrading to the Greater Resignation, as the number of quitting workers is expanding like the elastic waistband on your soft pants after Thanksgiving dinner. The latest figures from the Bureau of Labor Statistics show that 4.4 million workers quit their jobs in September alone—an increase of 164,000 employees from the previous month—and the highest number since BLS started tracking the “quit level” in 2000.
Some employers are trying to boost retention by offering more pay and benefits, greater work-life balance, and even unconventional riffs on the traditional workweek. However, some say that companies might need to start thinking about this high rate of turnover as less of a blip and more of a new equilibrium.
Crazy, stupid, inflation: Leisure and hospitality have been hit particularly hard by the worker exodus. The BLS figures indicate that jobs in the category classified as “arts, entertainment, and recreation” saw the highest number of quits, with 124,000 resigning in September, an increase of 56,000 resignations from August. Some experts, like Glassdoor economist Daniel Zhao, believe the exodus in this sector of the economy may be fueled by lingering pandemic fears.
“Workers are fed up with working conditions and feel unsafe and quitting even though they might not immediately jump into a new job,” Zhao told the Washington Post this month.
Inflation may also make current wages for some workers feel more like a pay cut. BLS reported last week that real average hourly earnings for all employees declined by 0.5% from September to October, owing largely to inflation’s impact.
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“Inflation is running, give or take around 5%,” Brian Kropp, Gartner’s chief of HR research, told HR Brew. “Most companies are not planning for a 5% increase in wages as they’re...planning for 2022,” Kropp said. “If you’re an employee, and your rent goes up by 5% and your wages go up by 2%, if you know that you can quit your job and go somewhere else for a 15% or 20% [wage] increase, that makes it a whole lot more likely that you actually change jobs.”
Turnover never over? While Kropp attributes much of the current surge in resignations to the “hotness of the labor market,” he predicts normalized remote and hybrid working setups will make high turnover more common, owing to the expanded “geographic footprint” of the distributed workforce. “Remote employees, their social connections, or social relationships with their other employees are a lot weaker, they just have fewer friends at work” and are therefore far more willing to quit, Kropp said.
Not rocket science: When there are more open jobs than workers to fill them, workers have more options. Kropp urged companies to be prepared: “As we go into the future, companies need to be planning for a turnover rate on a year-on-year basis to be 50% [to] 75% higher than what they’ve been used to.” —SB
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