Why is the Great Resignation happening?


Why is the Great Resignation happening?

Did it start with the Covid-19 pandemic? 

Which sectors have been hit the hardest?

What are the main reasons workers are leaving?

How much of a factor is mental health?

How to avoid the Great Resignation and increase employee retention?

Boost employee retention with Sodexo Engage


Why is the Great Resignation happening?

Unless you’ve been hiding under a rock for the past 18 months, you’ve probably heard about the Great Resignation.

At the height of the Covid-19 pandemic, businesses put hiring plans on hold and employees stayed put. But as economies began to open back up, all of those pent up resignations were released. In fact, as many as a quarter of all UK workers were considering leaving their jobs last year.

Despite the fact the UK economy has been open for several months though, resignations are still well above pre-pandemic levels. Why is the Great Resignation still happening?


Did it start with the Covid-19 pandemic?

The term ‘Great Resignation’ wasn’t coined until post-Covid, but did it actually begin with the pandemic?

Between 2009 and 2019, the rate of job-to-job moves was increasing steadily. This was accelerated post lockdown (following a sharp drop during 2020), but the trend before that was clear.

Source: Office for National Statistics, labour market flows

However, it’s worth noting that job-to-job moves declined significantly following the 2008 financial crisis. Was the following steady increase just a return to where it would’ve been? If so, the current record job to job movement is not a continuation of a trend, but indeed a clear indication that Covid-19 has led to the Great Resignation.

The pandemic may have created conditions amenable to employees moving jobs quickly, but organisations have to take responsibility too. If your business is seeing a high voluntary staff churn, are you doing enough to retain talent?


Which sectors have been hit the hardest?

The industries hit hardest by the pandemic, healthcare, leisure and hospitality, and retail, are also the industries hit hardest by the Great Resignation.

These generally low-paying jobs are giving workers the least reason to stay, but there are also lots of job openings. Why stay working at a restaurant for £9.50/hour when you can get £10.50/hour next door? These sectors also rarely offer much in the way of employee benefits.


What are the main reasons workers are leaving?

Microsoft’s 2021 Work Trend Index uncovered the top seven reasons workers are considering leaving their jobs:

  1. They’re confident they can find a new job, and with good reasons. Almost two thirds of employers are currently recruiting, and with the ratio of unemployed people to jobs being at a record low of 1.1, it’s a seller’s market for labour.

  2. Workers reflected on their careers during the pandemic and now want a change. A massive 74% of workers polled by Hays said the pandemic had given them time to consider their job choices.

  3. Workers don’t want to go back to the office, with 46% of people saying they’re likely to move jobs as a result of being able to work remotely.

  4. Employees are burned out, with 37% of employees globally saying their employers ask too much of them, and one in five thinking their company doesn’t care about their work-life balance.

  5. After Covid-19 led to a pause in career progression for many, workers are now ready to move forward, and often this requires a job move.

  6. Covid-19 put financial strain on everyone, and money is still a big factor in making a career decision.

  7. Without the distractions of the office and their colleagues, many workers have realised they simply don’t like their jobs and want a fresh start, whether that’s a new company or a completely new career path. In some cases, remote work has reduced the connection people feel to the workplace.

How much of a factor is mental health?

In Microsoft’s 2021 Work Trend Index, mental health wasn’t cited as one of the top seven reasons for workers leaving their jobs. However, Deloitte’s 2022 annual mental health report found that mental health issues were indeed a strong driver for the Great Resignation.

This was particularly true for young people (18-29). Of those who had intentionally left or planned to leave a job, two thirds (65%) cited poor mental health as the reason.

“Mental health issues are a strong driver for the ‘Great resignation’,” said Elizabeth Hampson, Deloitte director.

“Long hours, increased stress and job insecurity have had a detrimental impact on quality of life during the pandemic. People are leaving their jobs, re-evaluating their careers and changing occupations in large numbers.

“Burnout among employees, such as feelings of exhaustion, mental distance from the job and reduced job performance, have been more evident during the pandemic.”


How to avoid the Great Resignation and increase employee retention?

Organisations aren’t helpless when it comes to reducing the impact of the Great Resignation on their business. Here’s how you can improve employee retention.

Show appreciation

A study of 200,000 people across the UK and several other countries by Boston Consulting Group found that a lack of appreciation was the number one job satisfaction factor. Is your organisation doing enough to thank people for a job well done?

 Implement a recognition and rewards programme to empower line managers and colleagues to say thanks and incentivise great performance. 

Be more flexible

As already mentioned, being able to work remotely to some degree is now a major factor in whether or not someone stays with an organisation. Further to Microsoft’s study, a Flexjobs survey found that 80% of employees would stay in a job longer and demonstrate loyalty if their employer offered them more flexible working arrangements.

Support their wellbeing

Employees are prioritising wellbeing in the workplace more than ever before, and if your organisation doesn’t take steps for supporting this, workers will move to a company that does.

An Employee Assistance Programme (EAP) is a great way of directly supporting employee mental health, but it’s not just about emotional wellbeing. Physical and financial wellbeing are also critical to wellbeing as a whole, and you need to institute initiatives that support each of these three pillars.


Boost employee retention with Sodexo Engage

There’s no single quick fix for organisations looking to improve employee retention and combat the effects of the Great Resignation. It takes a strategic approach, but doing this effectively isn’t easy.

That’s why so many businesses just like yours choose to work with Sodexo Engage.

We have over 60 years of experience in delivering employee engagement solutions that deliver genuine ROI, increasing productivity, job satisfaction and results that are ultimately reflected in your bottom line.

Want to find out more about our wide range of solutions, including our Financial Wellbeing Hub, Employee Benefits Platform and Rewards and Recognition programme? Simply get in touch with the team here at Sodexo Engage today and start the journey towards improved employee retention.





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