Did you hear this statistic? Just this past April, a total of 4 million Americans quit their jobs, according to data recently released by the US Labor Department and reported on by the New York Times. Think about that for a moment. That April figure was the largest number of workers quitting their jobs in any one month…ever. Why? Ah…that’s a good question. I’m glad you asked…
See why workers are quitting their jobs in droves…
A clue to the answer to the question posed above – Just why are a record number of Americans quitting their jobs? – can be seen in just about every town in the country. Even in my sleepy little borough here in New Jersey, just about every shop and business has a help wanted sign in their window. From a tiny little local lunch counter to a major national retail chain, there is not enough labor for them to return to normal productivity.
I recently chuckled to myself when I was speaking with a CEO who bellowed that he has ordered his employees back to the office and he can hardly wait for them all to be back under his thumb. We’ll see how that plays out, but my suspicion is that a significant number of them – more than 40% according to a recent poll – will quit rather than return. He should be careful about what he wishes for.
All Industries Were Hit; The Battle Over Employees is ‘Fierce’
According to the Labor Department report, all industries were touched by workers quitting, but this was especially true in the leisure and hospitality industry – it was hit hard. And the competition to replace those workers has never been tougher…the Times article described the battle over hiring employees as “fierce.”
As I said above, the reasons are many. Economist suggest one reason may be a form of pent-up demand. Last year in 2020, the year of COVID, there were far fewer workers who quit their jobs. It was a wild ride for workers last year leading many of them, as the Times put it, “to ride out the labor market’s convulsions, stuck in jobs they wanted to leave anyway.” So with the number of people quitting last year lower than normal, it is logical to think that this year there would be a bit of a correction with more people choosing to quit.
COVID is a Complicating Factor
COVID may remain a complicating factor this year as well. Some employees are not yet comfortable getting back to their normal mass transit commute heading into a central office full of people. Whether this concern is rational or not, they may feel that the currently hot and rebounding economy offers them options.
I mentioned in a previous post, that many employees have decided that they like remote working, and if you won’t offer them that opportunity on a continuing basis, they’ll go somewhere else where the employer is more flexible on that perk. Some of them for sure continue to worry about the virus and its variants, but alternatively, they may still have child care or elder care situations to deal with. Especially if the job is a relatively low-paying position, the economics just may not fit their lifestyle calculation.
Too Many Openings Chasing Too Few Applicants
In any event, the economy is reopening with a vengeance and job opportunities are exploding. Just months ago, it looked like the end of the world. Now, for employees, it looks like a whole new world, and companies are forced to offer signing bonuses, higher wages, and other perks – even for relatively low-paying jobs. There are just too many openings chasing too few potential employees.
This new reality is making it harder than ever for employers to hire and retain workers. Face it, your employees feel empowered, with an employment market more favorable for them than at almost any other time in their lives. And after the trauma of 2020, they feel free to try new things, including looking for a job that makes them happier because of better pay…or more free time…or just about whatever they want.
The Current Hiring Situation is a Complicating Factor in Tech
But in an industry like tech, that already had trouble finding quality workers before the pandemic, this new trend will compound our problems. Oh and by the way, most experts believe this trend of empowered employees will continue for several more months.
So I recommend that business owners and managers consider being flexible with working arrangements – such as a hybrid workforce, some remote, some in office – as well as with pay ranges, and other perks in order to snag the right employees. Otherwise, manpower shortages could cause you to lose opportunities and the revenues they generate.