With 4.2 million Americans quitting their jobs in October 2021 alone, attracting and retaining workers rises to the top as a critical business priority. Savvy leaders recognize that this is not just about people quitting. It’s a worker revolution where people have greater flexibility to determine where, how and when they want to work. These factors and more present CxO leaders with an opportunity and a responsibility to realign their business and talent practices.
Has the Great Resignation impacted your business? If so, you’re not alone. Over 300 executives surveyed by The Predictive Index shared their insights about The Great Resignation summarized in the 2022 State of Talent Optimization Report . The “Big Quit” is top of mind, and executives across industries are feeling the sting. Executives reported that one in five workers have quit in the last six months, and 75% of execs say it has impacted their financial stability.
Top 5 Ways to Terminate Turnover:
On a positive note, the report revealed five turnover terminators to combat these challenges:
1. Companies with the right people in the right roles have 42% lower turnover.
Most of us have experienced the pain of hiring the wrong person for a role. Relying on resumes, the usual sources and “gut feeling” sets you up for retention roulette risking hiring someone who doesn’t fit the role, the team or your culture. The tight labor market brings desperation hiring to the forefront. Aligning the right people in the right roles should be every leader’s dream. Building a company of top performers (and keeping them) starts with putting the right people in the right roles. People with a solid fit to their job, team and company culture are more engaged, more committed and more likely to perform well.
2. Remote-friendly companies are experiencing 33% lower turnover.
Leaders of fully on-site organizations (either by necessity or by choice) reported a turnover rate of 24%. That number drops to 16% among remote-friendly organizations (i.e., those that support hybrid or remote work in any capacity)—that’s an eight percent decline (and 33 percent change).
A September 2020 global study by Steelcase revealed that while most people want to work from home to a degree, most also want an opportunity to come back to the office. 54% of US respondents say they expect to work from home one day a week or less; 26% say they expect to work from home just two to three days per week.
Bringing them back to the same old office, work environment and hours won’t cut it. Leaders who take this massive shift as an opportunity to create better work experiences, inspire and engage people and help teams work together better in the future.
3. Companies that prioritize health care benefits experience 27% lower turnover.
This pandemic-era work experience has not only brought forth physical health concerns related to Covid-19, it has also revealed behavioral health concerns as employees grapple with family challenges, isolation from social circles, financial challenges and more. Desired healthcare benefits have moved beyond easy and affordable access to medical care. These extend beyond the physical, into the realm of emotional health. Employees also value having a healthy workplace. Companies reporting that providing competitive health care benefits isn’t a top-three talent priority, executives reported a 22% turnover rate. By contrast, companies where healthcare benefits are a priority, the attrition rate falls to 16%—a six-point decrease (and 27 percent change).
4. Inclusive companies are experiencing 19% lower turnover.
Beyond physical safety at work, people also crave psychological safety. The want to feel safe to freely share ideas with bosses and colleagues who will listen and value their perspectives. That feeling is so important, it’s making the difference between a quit and a stay. Beyond illuminating the importance of healthcare, the pandemic put inequity in all forms in the spotlight. Improving diversity is only the part of the equation. Inclusion goes beyond diversity to embrace all voices and all experiences. Doing so helps to reduce turnover.
5. Companies practicing talent optimization are nearly twice as likely to avoid the brunt of The Great Resignation.
Talent optimization simply means ensuring your business and talent strategies are aligned. When your talent is equipped to execute on business strategy, it means you’re leveraging each person’s natural strengths—and optimizing their potential. That’s what talent optimization is all about. Successful businesses don’t run themselves. Even the most well-crafted strategy requires the right people and practices to execute well. Aligning both talent and business strategies includes designing the right teams and structure, hiring the right people for each role, inspiring them by providing development and coaching opportunities and keeping your finger on the pulse of your workforce by diagnosing and uncovering aspects of disengagement in teams or the organization.
Read this insightful report to discover how executives are tackling The Great Resignation. Ask us how we can help you to future-proof your organization.
Future blogs in this series will dive more deeply into each of these areas with recommendations and resources. To identify the best actions for you to take for your company, first, quantify the talent problems you are facing and the impact on your business. Next, identify the root causes driving workers to quit and to remain. Then implement targeted, aligned magnetic workforce strategies to attract, engage and retain the best people for your organization.
Contact us to learn how we can help you create, align and optimize your business and talent strategies. Visit our Resources section for other useful articles, tools and reports.
The 2022 State of Talent Optimization Report by The Predictive Index, January 2022.
The Great Resignation Doesn’t Have to Threaten Your DE&I Efforts by Arthur Woods, Harvard Business Review, September 1, 2021
Work Better: It’s time for an experience that’s fundamentally better, Steelcase. Work Experience Diagnostic Study conducted in September 2020 by Steelcase in 10 countries.