Making Sense of the Great Resignation

More than 47 million Americans voluntarily quit their jobs in 2021, reports the U.S. Bureau of Labor Statistics. The result is that many BKBG Shareholders and Preferred Vendor Partners can’t find the labor necessary to grow their businesses and often efficiently manage the business that they currently have.

The Great Resignation is not an anomaly, write Harvard Business School professors Joseph Fuller and William Kerr. While COVID may have caused more people to quit their jobs in greater numbers, Fuller and Kerr found that since 2009, Americans have been leaving the labor market in greater numbers every year.

They attribute the decline in the number of American workers to the following five factors:

• Retirement – In 2021, older workers retired at an accelerated rate and did so at younger ages.
• Relocation – It’s a misnomer to believe that skilled workers left their jobs in major metropolitan areas for more rural and/or affordable locales. Fuller and Kerr found that overall movement rate in 2021 was the lowest in 70 years and those who did move, disproportionately moved locally.
• Reconsideration – Many workers, especially women are reconsidering their jobs, because of the need to care for a family member. A recent study found that 33% of women are considering leaving the workforce, changing jobs or reducing hours. In many cases, this is not a choice decision but one of necessity to take care of family members.
• Reshuffling – Workers are seeking greener pastures and higher wages in greater numbers. They are not necessarily leaving the workforce evidenced by data from the Economic Policy Institute that found hiring rates are exceeding quit rates in many sectors. This has caused many businesses to increase wages. McDonald’s increased its minimum wage from $11 to $17 an hour and offered better benefits. The lowest paid worker at Bank of America makes $25 an hour. Walmart has agreed to pay full college tuition and books for all associates.
• Reluctance – Health concerns associated with COVID are another reason employees are leaving the workforce or changing their work habits. A Pew Research study found that 64% of workers are not comfortable returning to the office and a Harvard study found that 36% of workers will look for another job if they can’t have a hybrid option to work at least part of the time from home.

 
Showrooms and Preferred Vendor partners looking to retain and attract top talent should consider which of the five factors is making it difficult to hire and causing team members to leave.