The Great Resignation: Fact vs. Fiction

Episode #1050: As businesses and economies re-open following the COVID-19 pandemic, business leaders have been increasingly concerned about what has been called, “The Great Resignation.” In this episode of the Arete Coach™ Podcast, insights, data, and research are reviewed surrounding The Great Resignation. Using recent data, facts are separated from fiction, insights on how businesses are withstanding The Great Resignation are shared, advice to smaller businesses is offered, and the third wave of the pandemic is discussed.



About Severin Sorensen

Severin Sorensen is a serial entrepreneur and lifetime learner with a passionate curiosity for people and businesses. Severin is the CEO of ePraxis LLC, a premier level retained search firm that provides executive headhunting, talent selection, and executive coaching. In addition to finding top talent, Severin has provided over 7,500+ hours of paid executive coaching to entrepreneurs, CEOs, Presidents, and C-level executives. Severin is an ICF ACSTH Certified Executive Coach, Certified Organizational Development Coach, Certified Life Coach, and Certified Positive Intelligence® Coach. Severin is the founder/producer of a new podcast, Arete Coach, that explores the art and science of executive coaching with some of the industry's best coaches.


From 2010-2018 Severin was also a Vistage Chair where he coached three CEO and key executive groups. In 2011, Severin received the "Rookie of the Year Chair Award" from Vistage. Since 2013, Severin has added international speaking for Vistage, CEO conferences, executive peer groups, and corporations on the topic of identifying and hiring difference-making top talent.


After graduate school, Severin moved to Washington, DC, where he worked on security-related economic and public policy issues that included a brief stint in The White House, as a Special Assistant to the President, for George H. Bush (POTUS 41). In 1994, Severin founded Sparta Consulting Corp., and Sparta provided world-class physical security and safety related management consulting services for public and private sector entities. From 1994-2002, Severin managed HUD's Crime Prevention Through Environmental Design technical assistance and training program. In 2005, Severin sold Sparta to Westec Interactive (Digital Witness), which was subsequently acquired by Interface Security.


Severin, a native Californian, grew up in Salt Lake City, UT and graduated with honors from the University of Utah with Economics and Political Science degrees. He completed graduate studies in economics at King's College, Cambridge University (England), where he earned a M.Phil. degree in Economics. Severin has a great love and appreciation for sports, and while overseas, Severin rowed for the King's College Boat Club, and played basketball for the Cambridge University Basketball Team (1986-87).

Key highlights


Defining The Great Resignation

Timestamp 01:52


Because of the impact The Great Resignation has had on executives, it is important for executive coaches to understand what The Great Resignation is and how to best respond to it. Currently, many employees are changing their careers or jobs. Anthony Klotz, a Texas A&M University Professor, is the first to coin the term “Great Resignation” which is defined as a “widespread trend of a significant number of workers leaving their jobs during the COVID-19 pandemic.”


Weighing the cost of staying vs. leaving a job

Timestamp 06:40


Scholars, such as Anthony Klotz, believe that under normal circumstances the cost of leaving a job is seemingly greater to employees than the cost of staying. However, during the COVID-19 pandemic, employees were able to save money and shift their finances which resulted in a shift in perception where now the cost of staying with an employer is greater than leaving. Anthony Klotz states that “higher employee burnout and enhanced financial security is a recipe for increased resignations.” Currently, The Great Resignation is having the greatest impact on hospitality, entertainment, and retail industries.


Historically high turnover rates

Timestamp 09:30


Since the COVID-19 pandemic, many nurses, doctors, and other medical professionals have been “fatigued from the stress of the pandemic” and “working in stressful environments.” From the data, we learn that 1 in 5 healthcare workers lost their jobs during the first year of the pandemic. Furthermore, the US Bureau of Labor Statistics states that 18% of healthcare staff have quit since the pandemic began, and of the remaining employees, 31% have thought of leaving. The aforementioned data paired with an attrition rate reaching nearly 30% for some positions, it’s no wonder that the healthcare industry is experiencing historically high turnover rates and staffing shortages as a result.


Turning away from and turning to

Timestamp 14:51


While there are some industries facing increased rates of turnover, Severin states that he has a “concern that we are putting too much into the notion of The Great Resignation.” Not every single person is resigning, and many employees are not resigning. In September 2021, only three precent of the workforce resigned. Because of this, Severin recommends referring to The Great Resignation as “the great turning away from and turning to…”


Reasons for The Great Resignation

Timestamp 17:04


Severin shares several reasons that some indicate contributed to The Great Resignation. These include those who stayed in jobs they would have otherwise quit during the pandemic, routine resignations in some industries, mid-career employee resignation, work-from-home changes, and post-traumatic stress syndrome.


11 reasons employees stay

Timestamp 25:01


Severin outlines Kittelson and Carpo Consulting’s “11 different reasons why employees stay.” The reasons are as follows: they are inspired to work smarter, they believe in the company’s mission and vision, they have work environment satisfaction, they do exciting and challenging work, they have a great relationship with their superiors, they have a good work-life balance, they have access to career growth, they have good benefits/incentives, they are paid well, they are mentored, and they feel valued, recognized, and respected.


Additional reasons for The Great Resignation

Timestamp 27:22


Because of the stress and changes that the COVID-19 pandemic has caused many employees, the third wave of the pandemic is a mental health crisis. Some employees are even quitting without lining up a new job. According to McKinsey and Company, up to 40% of employees do not have jobs lined up when they quit their current employment. One reason that these employees could be quitting is a lack of community and sense of belonging with their current employer. Furthermore, other employees are resigning because of the flexibility they have found with other work-from-home positions, and they do not want to return to the office. Health and wellness are also a concern for some employees who do not want to return to an unvaccinated workplace.


Leading companies and their response to The Great Resignation

Timestamp 32:56


Not all businesses are facing an increased loss of employees. Companies like Google, Facebook, Apple, and Netflix have been able to withstand the effects of The Great Resignation. One thing all these organizations have in common is that they offer above average benefits for their employees. For example, Google has been experiencing an increase in job applications during The Great Resignation and their benefits to employees include “baby bonding bucks,” fertility assistance, maternity leave, paternal leave that applies to adoption, foster care, surrogacy, free travel insurance, custom workstations, free meals, onsite laundry, and a variety of other services. Companies like Netflix, Amazon, and Facebook also have a wide range of benefits available to employees and are often noted as some of the best places to work.


Advice for smaller businesses

Timestamp 42:17


The massive benefits that larger companies give to their employees is often not an option for smaller companies. Because of this, Severin outlines some actions that smaller companies can take to decrease their turnover rates. Some of these recommendations include having financial confidence, fulfilling Kittelson and Carpo’s 11 reasons employees stay, providing room for growth, paying employees well, mentoring, and showing empathy.


Employees, employers, and empathy

Timestamp 47:11


“Empathy is key to employee retention.” A key feature of all the leading companies’ benefits package is the empathy it displays for employees. “83% of gen Z employees would choose an employer with a strong culture of empathy over an employer offering a slightly higher salary. 83% would consider leaving their current organization for a similar role at a more empathetic organization. 80% would switch companies for equal pay if the employer was more empathetic. 74% of employees… would work longer hours for an empathetic employer.” However only 48% of employees believe companies as a whole are empathetic versus 68% of their CEOs” (Business Solver, 2020). Employees are looking for empathetic employers, especially amidst the COVID-19 pandemic. This is a call for employers to re-examine employee needs, salary, benefits, and wellbeing.


Download the transcript

Click here to listen to the podcast, or click below to view the podcast outline and transcript:

Transcript_Severin Sorensen_Podcast #1050
.pdf
Download PDF • 501KB

Resources

Andres, T. (2018, December 19). Divided Decade: How the financial crisis changed jobs. Retrieved from https://www.marketplace.org/2018/12/19/what-we-learned-jobs/


Apollo Technical. (2021, September 01). Statistics On Remote Workers That Will Surprise You (2021). Retrieved from https://www.apollotechnical.com/statistics-on-remote-workers/


Bhattarai, A. (2020, August 14). Grocery workers say morale is at an all-time low: They don’t even treat us like humans anymore. Retrieved from https://www.washingtonpost.com/business/2020/08/12/grocery-workers-coronavirus/


Business Solver. (2020). State of Workplace Empathy: Executive Summary: Businessolver. Retrieved from https://info.businessolver.com/en-us/empathy-2020-exec-summary-ty?submissionGuid=964be9c3-2749-429c-a0db-0ffe1b71d464


Casselman, B. (2021, October 12). U.S. Workers Quitting Their Jobs Hit a Record in August. The New York Times. https://www.nytimes.com/2021/10/12/business/economy/workers-quitting-august.html


Comparably. (2021, October 18). Netflix Trends. Retrieved from https://www.comparably.com/companies/netflix/trends


Cook, I. (2021, September 15). Who Is Driving The Great Resignation? Harvard Business Review. https://hbr.org/2021/09/who-is-driving-the-great-resignation


Daily Pay. (2021, June 14). Health Care Turnover Rates [2021 Update]. DailyPay. https://www.dailypay.com/blog/employee-turnover-rates-in-the-healthcare-industry/


Domm, P. (2021, October 12). Inflation gauge should be hot again in September and for the months ahead. Retrieved from https://www.cnbc.com/2021/10/12/inflation-gauge-should-be-hot-again-in-september-and-for-months-ahead-.html


Eira, A. (2021, March 24). Number of Facebook Employees 2021/2022: Compensation, Tenure & Perks. Retrieved from https://financesonline.com/number-of-facebook-employees/


Greenwood, A. (2021, February 10). The 4 Netflix HR Practices That Took Us From Average to Awesome. Retrieved from https://www.process.st/hr-practices/


Head Topics. (2021, October 18). EXCLUSIVE: Google saw its lowest attrition rate in a decade in 2020. Retrieved from https://headtopics.com/us/exclusive-google-saw-its-lowest-attrition-rate-in-a-decade-in-2020-22186733


Hsu, A. (2021, June 24). As The Pandemic Recedes, Millions Of Workers Are Saying “I Quit.” NPR. https://www.npr.org/2021/06/24/1007914455/as-the-pandemic-recedes-millions-of-workers-are-saying-i-quit


Klotz, A. (2021, May 30). The Covid vaccine means a return to work. And a wave of resignations. NBC News. https://www.nbcnews.com/think/opinion/covid-vaccine-means-return-work-wave-resignations-ncna1269018


Lane, S. (2021, November 12). Number of Americans quitting jobs reached record high in September. TheHill. https://thehill.com/policy/finance/581314-quits-reach-record-high-in-september-as-tight-market-boosts-workers


Levels.fyi. (n.d.). Facebook Company Perks & Benefits. Retrieved from https://www.levels.fyi/company/Facebook/benefits/


Markovic, I. (2021, August 19). How Apple improved their Employee Retention Rate by 28%. Retrieved from https://edume.com/blog/how-apple-improved-employee-retention-rate


Masson, G. (2021, November 17). About 1 in 5 healthcare workers have left medicine since the pandemic began — Here’s why. Becker’s Hospital Review. https://www.beckershospitalreview.com/workforce/about-1-in-5-healthcare-workers-have-left-medicine-since-the-pandemic-began-here-s-why.html


McKinsey & Company. (2021, October 19). 'Great Attrition' or 'Great Attraction'? The choice is yours. Retrieved from https://www.mckinsey.com/business-functions/people-and-organizational-performance/our-insights/great-attrition-or-great-attraction-the-choice-is-yours


MHA. (2021). The State of Mental Health in America. Retrieved from https://mhanational.org/issues/state-mental-health-america


Patton, E. (2021, July 6). As office life beckons again, the pandemic’s digital nomads weigh benefits of a return. NBC News. https://www.nbcnews.com/business/business-news/office-life-beckons-again-pandemic-s-digital-nomads-weigh-benefits-n1273000


Rep. No. USDL-21-1690 (2021).https://www.bls.gov/news.release/pdf/ebs2.pdf


Selyukh, A. (2021, July 20). NPR Cookie Consent and Choices. NPR. https://www.npr.org/2021/07/20/1016081936/low-pay-no-benefits-rude-customers-restaurant-workers-quit-at-record-rate


Spencer, J. (2021, January 22). How Much is Average PTO in the U.S.? Retrieved from https://www.zenefits.com/workest/how-much-is-average-pto-in-the-us/


WCVB. (2021, October 18). CEO sends letter about 'last, best and final offer' to striking nurses. Retrieved from https://www.wcvb.com/article/st-vincent-hospital-ceo-sends-letter-about-last-best-and-final-offer-to-striking-nurses/37992327


Wells, M. (2021, April 10). What Is The Average Employee Retention Rate by Industry? [2021 Update]. DailyPay. https://www.dailypay.com/blog/employee-retention-rate/


Copyright © 2022 by Arete Coach™ LLC. All rights reserved.