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Stop Calling It A Labor Shortage It Is A Turnover Crisis

The Statistics Are Alarming

In the second quarter of 2021, about 11.5 million workers quit their jobs, leading to a record-setting of 10.1 million jobs openings created in the US. Globally, 41% of the workforce is considering leaving their current employer within the next year. 54% of Gen Z are considering quitting.

The “Great Resignation” is a mass, voluntary exodus from the workforce. It is here, and it is quite real. Turnover is nothing new and neither are corporate retention strategies. But the Great Resignation and extreme turnover happening today across industries is a different phenomenon that requires a different approach.

What Is Fueling The Great Resignation?

The pandemic, which began in early 2020, has been a primary catalyst for this mass exodus from the workforce. Many individuals reevaluated their work situations due to the prolonged time spent at home, with 74% of respondents in a LinkedIn survey citing this as a reason. Stress and burnout were also major factors, with over 50% of respondents indicating these issues as a motivation to seek new opportunities. Additionally, dissatisfaction with how employers treated their workforce during the pandemic, from a lack of genuine concern to unequal treatment, played a significant role. Finally, the increase in unemployment benefits has caused a lack of urgency for many to return to the workforce. We saw a booming economy during the last decade, which always results in two things: Most businesses start losing focus on the customer and employee experience.

A Professional Awakening

The pandemic has prompted a professional awakening for many individuals, similar to the effect of surviving a near-death experience. Employees are reevaluating their career paths and setting new boundaries for what they are willing to tolerate. However, numerous leaders are using the Great Resignation as an excuse rather than addressing the underlying issues. A key factor contributing to high turnover rates is poor company culture, where leaders prioritize productivity and profits over employee well-being.

I have seen firsthand that the companies with the strongest company culture, long before the pandemic, are significantly less affected by the so-called labor shortage. And the organizations that churned and burned their team members or only had lip service to support a “great” workplace culture are the ones hit the hardest by the employee turnover.

Leadership Epiphany

“You are the average of the five people you spend the most time with.”

We must audit the people around us to make sure we are spending time with people who make us better, inspire us, and encourage us in all areas of our lives.

Leaders have a crucial role in shaping the work environment. Just as individuals choose the people they surround themselves with, leaders select the individuals employees will interact with most in their professional lives. Therefore, leaders must ensure they create a positive, supportive, and inspiring circle for their employees. Neglecting this responsibility results in decreased morale, poor performance, and high turnover rates. Great employees dislike working with those who bring negativity to the workplace, and compromising on hiring and retention decisions damages the overall culture.

I disagree with the way this old adage is worded: “Employees don’t quit companies, they quit leaders.” While that is true, it is incomplete. The correct way to say it is: “Employees don’t quit companies, they quit people.” Employees quit because of the people they work with (coworkers and leaders).

“You can’t hire your way out of a bad culture.”

The 2 Biggest Mistakes Companies Are Making Right Now

  1. Hiring To Fill Vacant Positions With Just Anyone

  2. Keeping Poor Performers

Two major mistakes companies are making in response to the labor shortage are hastily hiring anyone to fill vacant positions and retaining poor performers. Both are huge mistakes. “A” players hate working with “B” and “C” players. Unengaged employees drain the energy out of your organization. The priority should be retaining top talent and improving internal culture, rather than searching for external hires. Stop trying to find great employees; instead, focus on becoming the type of business great employees find.

The businesses with the highest engaged employees enjoy:

  • 81% less absenteeism

  • 33% less turnover

  • 10% increase in customer loyalty/engagement

  • 23% more profitability

“Stop trying to find great employees. Focus on becoming the business great employees find.”

Businesses need to stop treating their employees like children. Leadership needs to be about helping people reach their potential in performance, not just managing them if they break policy or screw up. High performers need innovation; innovators need autonomy. Don’t let one poor employee ruin your organization’s freedom and flexibility. Employee freedom means they can take a lot of risks and fail. Risk-taking breeds innovation.

“Days of lighting fires under people are over. Days of lighting fires inside people are here.”

10 Ways To Build The Culture Employees Will Love

  1. Show genuine love and care for employees.

  2. Refrain from compromising on hiring and retention decisions.

  3. Prioritize employees’ mental health.

  4. Regularly measure employee engagement through surveys.

  5. Improve the quality of your employees’ lives.

  6. Inspire employees to reach their fullest potential rather than micromanaging.

  7. Increase one-on-one meetings, particularly for virtual teams.

  8. Constantly share vision, direction, and what is in it for them.

  9. Demonstrate you genuinely care for your employees.

  10. Implement systems that acknowledge and celebrate employees' achievements.

John DiJulius, the bestselling author of five customer service books, is the chief revolution officer of The DiJulius Group and works with the top brands in the world on customer and employee experience.

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