What stage of endemic with the Great Resignation? There was quite a lot of talk about essential workers, but most of it appeared to be about essential jobs. But the labor market has tightened, all employees have the potential to find new employment elsewhere and replacing them isn’t easy and can be very costly to recruit.
But then things started to change in April 2021. Workers started to quit their jobs almost in a bulk, hitting the food, health, and tech industry the most.
According to the U.S. Bureau of Labor Statistics, more than 4 million Americans quit their jobs in July 2021. And this wasn’t limited to just July 2021— 4.4 million Americans quit their jobs in September as well which caused a trend that we call “The Great Resignation”.
In this article, we’ll look at the reasons why the great resignation happened and how to keep your employees satisfied so they stay at their jobs. But first, let’s look at the term The Great Resignation.
What is the Great Resignation?
The Great Resignation, or Big Quit as you will sometimes hear, is a term coined by Anthony Klotz, who is an organizational psychologist from Texas A&M.
The Great Resignation is a term that stands for the ongoing trend of employees leaving their jobs on a voluntary basis, starting from April of 2021. Klotz predicted that The Great Resignation will start from May 2021.
One of the main reasons stated for the Big Quit was the response to the global COVID-19 pandemic, but there’s more to it than meets the eye.
Why does it happen
Any employee that pays rent or a mortgage can vividly describe to you why The Great Resignation is happening.
Years of stagnating salaries and the lowered benefits during the pandemic lockdown caused employees to realize that they don’t like their jobs, that they feel exploited, and in turn, quit their jobs.
That’s why most voluntary departures from the companies weren’t in the 18-24 category, but in the 30-45-year-old category. Employees have realized that they haven’t been treated the right way in their companies so they decided to leave.
Many Companies reported sky-high profits during the crisis— Walmart had one of its best years during the global pandemic. But employees didn't feel they were receiving their fair share. Not to mention the rise in CEO salaries— From 1978 to 2020, CEO’s salaries grew by 1,322%, while the average salary in the USA grew only 8.8% and their salary is 351 times higher than a typical worker in 2020.
As one teacher said, “it became so clear that this isn’t about my health, the health of the kids or the mental wellbeing of anybody. It’s a business and it’s about money. The pandemic ripped that veil from my eyes.”
So what can companies do about it?
Companies need to listen to their employees, Percival.live is a tool that empowers employees to have a say about their remuneration, be it an end-of-the-year bonus, project bonus, or their salary.
Companies like the software studio Webgoal, have seen their employee turnover reduce to 66.7%.
Some companies are catching up with the idea that giving their employees a fair salary will reduce the company turnover. Klaus Wuestefeld, CEO of Percival.live, knows about the impact of paying employees a fair salary since 2002 and since launching Percival in 2019 is empowering other companies to do the same.
Why you should use Percival.live to fight the Great Resignation
Percival.live will help you create fair compensation for your agile teams by:
Create perceived fair salaries. Using our team set salaries methodology the results are not only fair, but the team members perceive them as fair. And if team members feel like they’re getting their fair share of the pie, they will feel grateful and stay in their jobs.
Deliver actionable insights. You get numerical results for each appraisal so you know exactly what needs to be done. No time wasted.
Create a collaborative framework for salaries. The evaluations are made by team members so everyone will collaborate on them to get their fair amount.
All done in only 15 minutes per team member, through an intuitive and easy-to-use interface.
When you use team-set salaries, your employees will share bonuses and set salaries in a fair way and that will help your company keep your employees satisfied.
Conclusion
The Great Resignation caused many employers to lose employees and create additional problems for their companies. Benefits, health issues, and salary problems caused many employees to quit. By implementing the team-set salaries, you will give your team a way to express what a fair salary looks like.
If you want to learn more about team-set salaries, you should book a demo call with us and we will explain all the details and how you can start implementing TSS in your company.