For many industries, the Great Resignation has been anything but great. In fact, for industries such as leisure and hospitality; transportation and utilities; professional and business services and construction (as a few examples) it’s been — at times — the worst.
“Arizona’s open jobs totaled 241,000 in January of 2022,” says Jennifer Pullen, Making Action Possible (MAP) Dashboard director. “And that’s partly connected to the ‘Great Resignation’ you hear about in the news. If we are not able to fill those jobs, the impact on the economy will be significant and serious.”
According to Forbes, in Sep. 2021 alone, a record high of 4.4 million people quit their jobs. In December, the U.S. Bureau of Labor Statistics reported 10.9 million available jobs across the country. Here in our home state, 222,000 job openings were also recorded — that’s equal to 6.8% of the total available jobs in Arizona.
The rather bleak labor market outlook has many employers worried, and wondering: when will the work crisis be over? As far as an answer, a recent Forbes article (sadly) says it best: “If business leaders think or hope that the Great Resignation will end anytime soon, they are likely to be disappointed.”
Deanne Desautels, president and CEO of Accounting & Finance Professionals Inc./ Staff-Logic Inc. affirms the sentiments of the Forbes story author. “The current hiring crisis is here to stay,” she says, “at least this year, and resignations or shorter-term employment are also here to stay.”
Desautels’ colleague, Justin Hook, partner and vice president of Accounting & Finance Professionals/Staff-Logic, Inc. agrees, predicting the rest of 2022 won’t see much change in the labor market from the year prior. “Demand for labor is at a historic high and workers are quitting their jobs at historic rates to take advantage of that demand,” he says. “The rate of hiring is higher than the resignation’s rate in every major industry, indicating workers are moving to other jobs, likely in the same industry.”
A level playing field
Some sectors have been spared the worst of the Great Resignation, but no industry or job market has escaped completely unscathed.
“Our industry is related to tourism, food service and personal retail,” says Travis Laird, regional director for global talent solutions for Robert Half, “But you see it everywhere. There’s not a brick-and-mortar location that you don’t walk into right now that doesn’t say ‘now hiring,’ ‘hiring on the spot,’ or ‘interviewing on the spot.’”
While the origins and implications of the Great Resignation are not yet fully understood, what is clear is the role played by COVID-19.
“Since the pandemic began, people have had new standards and expectations for their life as it relates to their work, including where they work, the kind of work they do and who they work for,” says Roy Palomo, president and CEO of Hotfoot Recruiters. “Many people who moved to remote work during the pandemic achieved a work/life balance they previously only dreamed of attaining.”
But, it’s not only people discovering new livelihoods or wanting to exclusively work remotely that’s caused upheaval in the labor market.
As noted by Desautels, “Baby Boomers exiting the workforce has been accelerated due to the pandemic.”
Pew Research Center revealed that in the third quarter of 2020, an estimated 28.6 million Baby Boomers in the U.S. exited the labor market to retire, marking an increase of 3.2 million more Boomers than in the same quarter the year before.
An employee-centric climate
The ripple effects from the escalation of job vacancies continue to reverberate throughout many industries. Food service labor shortages have resulted in longer wait times at restaurants and critical functions such as payroll and software development are often delayed. In logistics, trucking and transportation employee deficits have been known to bring business to a screeching halt in some cases, further impacting supply-chain issues. And, in construction, a recent report published by Porch estimates that 2.2 million more construction workers need to be hired to fulfill the demand between now and 2024.
The fallout from the Great Resignation has created what Laird refers to as an “employee-centric market.” Employees, now more than ever, are in a place to be more limber in their needs and wants.
“I have seen a good amount of our customer base — in those industries that are challenging to hire — being more accommodating, looking specifically at what works best for [the employee],” Laird explains.
Palomo adds, “People at all levels have personally assessed and are still assessing where work fits into their life, and if the current job they have is not offering them the life they want, they will leave because there are a plethora of opportunities available.”
A competitive edge
More opportunities in the sheer number of available jobs has prompted many companies to examine and redefine their offerings. To remain competitive in a saturated employment pool, even simply upping salary ranges may not be enough to entice new hires. In addition to competitive salaries, employers are expanding employee benefits packages and getting creative with flexible schedules, as examples of efforts needed to capture and retain talent.
“I would look at all aspects of what employees might want,” advises Laird. “What are the drivers for the employees that I have at my company today? Is it schedule? Is it pay? Is it location? Is it where they’re doing the work? Is it maybe the experience they have with those that they support at work? It’s a continuous listening mode of finding what drives employees in a specific department or company to want to stay there, and then acting on those things as quickly as possible.”
Desautels echoes how imperative communication is to keeping valued workers from walking. “Retaining talent in this market will involve staying in communication with your employees and making sure they know the value they bring to your organization,” she says. “With the cost of living jumping to the highest levels in over 40 years, people are struggling to keep up when their salary has remained stagnant or below the cost-of-living increases.”
Part of affirming an employee’s value beyond a salary increase can be in the form of a retention bonus. “Offer your staff retention bonuses on top of their regular salary or hourly pay rate,” Hook suggests. “This is a predetermined rate that gets paid when an employee stays at their job for a minimum agreed-upon time. You could also offer this monetary incentive after key performers complete a professional development course.”
Outside of compensation, employers are looking at ways to upgrade workplace benefits. For some, this means additional healthcare provisions such as mental health support and services, pet health and life insurance benefits. Other companies are exploring including student-loan payback programs, more PTO, allocated funds for annual professional development training and paid or discounted gym memberships.
“Such benefits show employees that the company cares for their wellbeing and wants to help employees avoid burnout at all costs,” Hook says.
Perhaps one of the more coveted — albeit challenging — implementations companies are attempting to offer employees are more flexible hours. In customer-facing service occupations, for example, flex hours are obviously more tricky, but employers are getting as creative as they can, according to Laird. “Things that we’re seeing in the market is employers saying ‘hey, you used to work four, eight-hour shifts, and now I’m going to trim down your week and you’re going to work maybe three, 12-hour shifts so that you have more days at home.’”
An ongoing appraisal
Beyond catering to the current employee-centric populace, job recruitment experts suggest that businesses remain adaptable and proactive in the appraisal of their workplace benefits, culture and hiring procedures. As an example, Palomo emphasizes the importance of investing in internal training and development, as well as avoiding stagnation in hiring processes.
“A few ways to change up your hiring strategy include, rethinking experience or degree requirements, partnering with local-level organizations and state-wide programs to identify untapped talent sources and finding new digital channels to promote your jobs,” he says. “Additionally, audit your hiring process and assess its efficiency.”
It’s equally important, as noted by Laird, to regularly examine the health and harmony of your existing workplace. One of the best ways to accomplish this is an anonymous survey that elicits what employees enjoy most about their work and workplace as well as what improvements they’d like to see.
Above all, one of the best strategies businesses can establish to secure both existing employees and potential job candidates is to continue to keep the lines of communication open; especially with no clear indication as to when the labor market will equalize.
“When hiring, find out what is most important to each employee and ask them questions to make sure their values align with the company values along with the ability to meet those needs,” Hook says.
Laird adds, “The trends and the numbers continue to tell us that it’s going to be this way for the foreseeable future. These things come in waves. But I think now more than ever, if you’re an employee looking to get to work, this is the best time to explore options.”