The Great Resignation: Why Millions Of Workers Are Quitting

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Americans are reassessing the way they work. According to an August 2021 poll, more than half of workers surveyed said they plan to look for a new job in the coming year. Fifty-six percent of respondents said adjustable working hours and remote work were a priority. And while some people have left the workforce entirely, job security and better pay are also top concerns for employees.

Its time to find something that is going to be better for my family, something more stable, something that I can provide, where I dont have to go to work and be like, oh, is he gonna, you know, am I gonna get fired today? Or is he not going to be happy with, you know, the service.

In August 2021, almost 4.3 million Americans quit their job. The resignation rate hit a 20-year high of 2.9%. Working women have faced an even heavier burden juggling childcare duties, virtual schooling and their careers.

Were all able to take a step back in the last year and spend more time doing other things and really question the value of what were doing at work. A number of people have made the decision I need to make a change, I need to, I need to simplify.

Dubbed "The Great Resignation", the exodus of workers has left millions of jobs unfilled and created hiring challenges for companies. So what does the realignment of the workforce mean for employees and businesses? And what steps should you take before quitting your job? U.S. workers are leaving their jobs in droves. In August 2021, almost 4.3 million Americans handed in their resignation, including 971,000 people working in the leisure and hospitality industry, which includes hotels and restaurants. Another 1.3 million workers were laid off or discharged by their employer.

Jessica Thomas is one of those workers. She spent nine years in the restaurant business in northern New Jersey before Covid hit. With cases surging and customers avoiding dining out, the bar where she worked temporarily shut its doors in the Spring of 2020, leaving her without a job and a paycheck.

But also in that industry, you know, if youre not working, youre not making money. So there are no sick days. Theres no vacation time. Theres no health insurance.

Uncertain when her job would restart, the mother of three found herself at home relying on unemployment benefits. Her husband, Derek who works as a bartender, faced a similar dilemma.

A lot of people took the time that, you know, when you have the time off and youre sitting home collecting unemployment, they took the time to find other careers.

I didnt hear anything from the owner until I think it was a day before when he was going to okay were reopening. There was no communication, nothing. So for me, that kind of just made me want to get out of that industry.

In August 2021, the separation rate for hotel and food service workers, which includes quits, layoffs and retirements, increased to 8.3% from 6.7% the month prior. And while the pandemic has caused a severe blow to employment overall, it is especially impacted working mothers. As of January 2021, there were 18.5 million U.S. mothers living with their school-aged children while actively working, 8% percent less than a year earlier. On the advisor brother-in-law, Jessica applied for a job at the Port of Newark, New Jersey, home to the East Coasts busiest port.

When I went in the gentleman at the door said, "you know youre at the wrong building" and I said "no, no, Im at the right place." He goes, "no, no, the the nurses for the Covid testing is the other building." I said, "no no, Im here to apply to be a longshorewoman." In Jessicas new job as a longshorewoman, she helps load and unload cargo ships that bringing electronic, apparel and consumer goods from around the world.

Monday I drove 1,700 Toyotas off of a ship. We got there at 7am we got done at 5pm. And you drive the car off, get back in the van, go back up, drive the car off until the ships done.

Nobody leaves until the ships complete.

Her new job also gave her a salary boost, double the pay of her previous job at the restaurant with benefits ranging from paid vacation to health insurance. And according to a May 2021 survey, Jessica is not alone. Almost half of workers polled said they are rethinking the type of job they want in the future. More than half said they would retrain for a new career if they have the opportunity.

I feel like Im always trying to find balance in my life.

Balancing with working and all the kids stuff, my relationship with my husband. Everyday its like okay, how am I going to do this? How are we going to get through this? According to an August 2021 study, almost a third of workers at large U.S. companies said they are likely to change jobs in the coming year. Younger workers are even more likely to uproot their careers. Half of Gen Z workers, particularly those struggling with productivity and time pressure issues at work plan to switch jobs in the coming year.

According to one financial planner, there are three solutions to remedy a non-ideal work situation. For starters, small changes can make a big difference. The easiest and least disruptive way forward for you and your company is to tweak the job you already have.

I would encourage employees to go have what I would call a job crafting conversation with their manager and say I love this 60%, this 40% not so much, what can we do, and that could be everything from maybe you just cut back to three days a week, and your job becomes a smaller job.

Volunteering or side hustle could be another way to cultivate experience and explore new industries. Another benefit, after a couple months, you can stop, continue or test out something else. And finally, if youre in a job that is mentally or physically trying has a poor work-life balance, or limited growth opportunities, that may be a signal, its time to look for a new job. But before quitting financial planner Roger Ma advises to take a look at your financial situation, and find out how much it costs to fund your lifestyle.

And then once you know that number, lets just say that your expenses are $50,000 and to be able to fund that you need to make $80,000 then you can start to look at what are the roles, what are the positions, what are the industries that pay that amount. It might be roles in a similar industry that youre in, or maybe youve been in your industry for a while and youre looking to pivot.

While searching for a new gig financial advisors say, its easier to find a new job if you already have one, and it also puts you in a better position to negotiate your salary. Leaving on good terms is another tip.

Even though you may think I will never come back to this company again a little insurance policy would be leaving on the best note possible. So maybe you leave that door open to boomeranging back at some point in the future.

The U.S. has seen a record number of people quit their jobs. But whats led to the boom in resignations? Several factors according to Anthony Klotz, associate professor of management at Texas A&M University. For starters, the pandemic forced Americans to take a hard look at their lives and reevaluate their careers.

But as a result of the deep thinking that people did during the pandemic, I reasoned that a number of them would plan life pivots coming out of that sometimes those life pivots would not involve a job change but in many cases, because of how central careers are to our lives, it would it wouldnt necessitate a career change.

Working from home with another factor. According to Klotz, a number of people who work remotely at the start of the pandemic have been unwilling to give up their autonomy.

I think what were finding is a number of employees who worked remotely felt like they could be more of themselves than they could in the office. And maybe in some cases, they felt like there was less harassment, less microaggressions, wear the clothes that they want, the hair the way they want. Burnout and mental health are another component. According to one survey, longer workweeks have become even more embedded in business culture. And the boundary between work and personal life has shrunk. More than 40% of workers at large U.S. companies said they had difficulty setting work and personal life boundaries. And almost 45% said they felt pressure to be reachable at all times.

There were lots of reports that burnout was at all-time highs for individuals and burnout is a pretty clear predictor of people quitting their jobs. Increased economic independence has also led to the rise of resignations.

According to an August 2021 study from Oxford Economics, American saved an additional $4 trillion during the Covid pandemic. While about 70% of that gain went to the wealthiest 20% of Americans, analysts say the economic uncertainty of 2020 forced many people to delay their retirement plans until 2021.

My sense is early retirements are up. People taking a break from the workforce like their own sabbatical is up. And thats supported by 2020 was only the second year in the last 35-years where American household debt actually went down.

Businesses across the U.S. are struggling to find workers. In August 2021 there are 10.4 million job openings across the country. According to a Q3 2021 CNBC survey, half of small business owners say its harder to find competent people to hire than a year ago and nearly a third so they have jobs they havent been able to fill for at least three months. But while the number of job openings has reached historic proportions it might not be an entirely new phenomenon.

Since the Bureau of Labor Statistics began tracking this back in 2000 the rate of employee resignations per month has gone up fairly steadily over the past 20 years. To entice workers back employers have come up with incentives ranging from college tuition to signing bonuses. In August 2021, Target announced a program to pay 100% of its workers college tuition.

The big box retailer said in addition to tuition, it would cover textbooks and fees for employees pursuing 250 college programs at more than 40 institutions. Chipotle, Starbucks and Walmart offer similar debt free education programs. Other companies have boosted pay. McDonalds announced in May it was raising hourly wages at company o ned restaurants. Walmart, U der Armour and Walgreens ave announced similar pay hikes. And according to analysts, hi ing new employees is only half the battle. Companies face a teep penalty if they are unab e to retain employees they al eady I think its incredibly expensive to lose talents and especially a lot of talent and so that youve got the loss of maybe this person has been thinking about it for some time, theyre unhappy so youre not getting the most out of them while theyre there, and then, you know, eventually when they decide to leave, you might have to spend several months to be able to attract new talent.

According to a 2017 study by the Work Institute, based on a median U.S. salary of $45,000 the average cost of turnover per employee is $15,000. That figure includes direct costs, like exit processing and relocation expenses, as well as training costs and lost productivity. According to the group, the cost to U.S. employers from worker resignations in 2016 alone was $536 billion. But despite these issues, analysts say that the wave of resignations were experiencing could ultimately lead to an improvement for the lives of both workers and the organizations that employ them.

I think the one silver lining out of this is that the pandemic has gotten people to review or question things that theyve done in the past and maybe if you have been on autopilot, its given you that kick to say, you know, this job, Ive been on autopilot this doesnt really align with my interests or my long-term goals and Im gonna make a change. With this many resignations that means theres lots of talented employees who arent working right now for any number of reasons. And so a lot of organizations see that as an opportunity as well, to improve their organization and improve their talent pool. Invest in you ready, set, grow, CNBC and acorns.

CNBC: The Great Resignation: Why Millions Of Workers Are Quitting - Market Research