While millions of workers around the world cling as much as they can to the jobs that have allowed them to get around the economic crisis caused by the coronavirus pandemic, in the United States the numbers of voluntary resignations are surpassing their all-time high.
Nearly four million workers, equivalent to 2.7% of the entire workforce, left their jobs last April — the highest number since the record began in 2000.
The data seems to confirm the materialization of a realignment in the labor market that the American academic Anthony Klotz called “the Great Renunciation.”
The coronavirus pandemic brutally impacted U.S. employment. In just two months, between February and April 2020, the number of unemployed rose from 5,717,000 to 23,109,000, from where a gradual decline began as governments, businesses and workers found a way to adapt and keep the economy going.
Despite the still partial recovery of the economy, the unemployment rate stood last May at 5.8%, well below the 14.8% it reached in April 2020, but still above the 3.5% it was in before the pandemic.
Thus, the wave of resignations contrasts with the fact that there are still more than 9.3 million unemployed people in the United States, according to Labor Department figures for May.
The “Great Renunciation” may also become a global phenomenon, judging by the results of a study commissioned by Microsoft that reveals that more than 40% of the global workforce is evaluating the possibility of changing employers This year.
But why is it that so many people are leaving their jobs?
Delayed resignations, job burnout and epiphanies
Although the reasons why each individual worker may decide to resign are myriad, Anthony Klotz, who is an associate professor of management at Texas A&M University’s Mays School of Business, says there were four specific factors that led him to anticipate this phenomenon.
Job burnout is one of the factors that drives workers to quit. Credit: GETTY IMAGES.
The first is that many employees who had plans to leave their positions in 2020 chose to delay that decision.
“Between 2015 and 2019, the number of resignations in the United States grew year after year, but that number dropped a lot in 2020, which makes sense because of the uncertainty of the pandemic. These people stayed in their jobs, even though they wanted to quit,” Klotz tells BBC Mundo.
It is estimated that in 2020 there were nearly six million fewer resignations in the United States of those that were foreseen.
The expert explains that once vaccination progresses and the economy improves, it was to be expected that these people who had already decided to resign would finally take that step.
“The most recent statistics from the Labor Department showing that April saw an all-time record number of resignations lead me to think that many of those people have already started to leave their posts,” Klotz says.
The second factor that would drive this phenomenon is the “job exhaustion“.
“We know from a lot of research that when people feel exhausted at work they are more likely to quit. And we’ve seen numerous stories of essential workers, but also of many people working from home while trying to strike a balance between their family and their jobs, who are experiencing high levels of burnout. There are now more ‘burned out’ workers than there are normally“, notes Klotz.
This expert in organizational psychology assures that the only cure for this type of wear and tear is to take a good break, so it is likely that those who do not have the option to do so will see in the renunciation a possible solution to their situation.
A third factor that would drive this wave of resignations, according to Klotz, is revelations or epiphanies.
After more than a year of the pandemic, many workers discovered that they want to change jobs and even lives. Credit: GETTY IMAGES.
He explains that sometimes people are happy with their work and something sudden happens that makes them think about leaving office, such as not getting a promotion they expected, the resignation of a colleague and situations like that.
“Now with the pandemic almost all of us have suffered an impact that has put us to reevaluate our lives, so many people have had these epiphanies: some realized they want to spend more time with family; others now feel that their work is not as important as they thought or want to do their own venture,” he explains.
“I think there are a lot of people who are considering making a change in their lives and that often involves a turnaround in their careers,” he adds.
The Rise of Remote Work
The fourth factor behind the “Big Resignation” has to do with those people who during the pandemic adapted to working from home and now don’t want to go back to the office, although for Klotz it’s a smaller percentage.
“As human beings we have the fundamental need to enjoy autonomy. When you work remotely you can structure your day as you want and you have a lot more flexibility than in the office. So, for a lot of people who don’t want to lose that freedom. Quitting to look for a remote or hybrid job can be an option,” says the expert.
Many workers do not want to give up the flexibility and autonomy offered by remote work. Credit: GETTY IMAGES.
An international study commissioned by Microsoft reveals that 70% of employees want companies to keep flexible remote work options and that, in fact, 45% of those who are working remotely have plans to move to a new location now that they can make a living without attending the office.
And more and more companies are willing to offer that possibility to their employees. According to data provided by LinkedIn to BBC Mundo the ads offering remote jobs on that platform were quintupled between May 2020 and May 2021.
The media and communication sector leads remote work offerings (27%), followed by the software and information technology industry (22%).
At the same time, nearly 25% of all job applications made between the end of April and May are for remote work positions.
Opportunities for the lowest paid
A fifth factor that would be driving this wave of resignations, according to many analysts, has to do with the situation of many of the lowest paid workers such as restaurant and hotel employees.
According to figures from the Labor Department, among those who left their posts last April were more than 740,000 people who came from leisure, hospitality and catering. That figure is equivalent to 5.3 per cent of all workers in this sector.
Restaurants now have many vacancies that they fail to fill. Credit: GETTY IMAGES.
The abrupt reopening of the economy has created a high demand for such employees, forcing companies to offer different types of incentives (including better wages) to try to fill vacancies.
“There is a lot of turnover in low-wage positions where people don’t really have a career progression. If you find a job that offers you just a little more, changing it comes at no cost to you,” Julia Pollak, labor economist at ZipRecruiter, explained to The New York Times.
A shock in the labor market
Klotz says that this whole scenario implies a very complex situation for companies, although he points out that they are already designed to deal with the demands of retaining their workers and finding new talent.
“What makes this a unique challenge is the type of labor arrangement (post-pandemic) because for most companies there is no right answer in terms of how much flexibility they should give their employees.
“Hopefully many organizations are talking to their workers to understand what they want, but in the end companies will have to make a decision and say ‘this is what we’re going to do.’ And there will be some employees who are not going to be happy, including -probably- several of the best,” he says.
“This is like a kind of big reorganization: there will be companies that will want to return completely to face-to-face work, some will choose to do it completely remotely and others will choose a hybrid format and workers will seek employment in those that offer the form of work they want“, adds.
With companies offering face-to-face, hybrid or remote workdays, employees will have more options than in the past. Credit: GETTY IMAGES.
Cassie Whitlock, head of Human Resources at talent management platform BambooHR, believes that companies that want to force workers to return to offices are the most at risk of losing them.
“Employees have worked in a remot waya for a year and it has worked. They’ll want to know why they can’t keep doing it. If you’re going to ask them to come back, you’d better have a convincing argument.” Whitlock warned Fast Company.
Klotz doesn’t necessarily see anything wrong with some organizations wanting to return to the “normal” way of working before the pandemic, but warns that many will find that their employees want a “new normal.”
“It may be that going back to the office is the right thing to do for their type of business, but they’ll probably risk losing employees who want that new normal. These companies will also miss opportunities in terms of competing for talent in the labor market as those that offer greater flexibility in terms of remote and hybrid work are more likely to recruit workers globally“, he says.
Klotz believes that one of the long-term consequences of all these changes in the labor market will be that workers will have many more options in terms of the different workday arrangements: face-to-face, remote and hybrid.
“It is possible to imagine that at different stages, you will be able to choose the formula that best serves you. Probably when you’re 20 you’ll want to be in the office; at the age of 30, with a young family you will look for a hybrid model and later, you will opt for remote work. So, you’ll be able to forge this kind of career, something that was really very difficult to do before the pandemic,” he concludes.
