The big quit continues. Unemployment remains low. Jobs go unfilled. If workers are shuffling around and jobs are available, where did everyone go, and why is recruiting so hard these days?
- Many of those who quit or are considering quitting are Gen Zs. An Adobe survey of 5,500 workers found that 56% of those ages 18–24 say they are planning to switch jobs in the next year.
- A key finding from the Lever “2022 Great Resignation: The State of Internal Mobility and Employee Retention Report” is that members of Gen Z are more than twice as likely to leave their current job (13%) as compared to Millennials (5%), Gen X (3%) or Baby Boomers (6%).
- While the Adobe survey didn’t address Baby Boomers, Goldman Sachs estimated that the other half of employees who quit their jobs were Baby Boomers over 55 years old.
- Steven Vaughan-Nichols, senior contributing editor of Red Ventures/ZDNet, notes the MIT Sloan Business Review, the biggest single predictor for companies losing workers by a big margin was a toxic work culture. “How big? A toxic corporate culture is 10 times more important than compensation in predicting turnover. Other reasons that ranked higher than wages were job insecurity/reorganization; high levels of innovation; failure to recognize employee performance; and poor COVID-19 response.”
- Finally, some employees retired or “aged out,” some just took time off, some switched to “gig” work, and others forged a new path – a new industry or different career, or started a company, to name a few alternatives.
Employers Need to Face the Issues
Workers are in a position of power and are being offered more opportunities and choices. Employers cannot deny or delay that much of their workforce, today and tomorrow, is requesting more from them. And the pandemic wasn’t the tipping point. Workers have been wanting changes for some time.
LinkedIn conducted a survey in 2018 to understand what professionals want. The key takeaways:
- The Hiring Dealbreakers – professionals would not work at a leading company if it meant they had to tolerate:
- Bad workplace culture (70%)
- Lower pay (65%)
- Forgoing a fancy title (26%)
- What’s Making Them Stay the Next 5+ Years?
- A sense of belonging (46%)
- Benefits over perks (44%)
- Support from the top (36%)
- Tips for Attracting, Retaining, and Fostering Top Talent Today
- Build pride in your company (87%)
- Maintain values in the workplace (39%)
There are numerous articles and surveys today that echo these same indicators four years later. As Baby Boomers move on, Millennials, Gen X, Y, and Z are reexamining their careers and the workplace culture and environment that fits them best.
Twenty-seven percent of 18-39-year-olds tell YPulse they have quit or resigned from a job in the last year, and of that group, 14% have left their positions in the last 6 months. When YPulse asked why they left, “My previous job was not good for my mental health” is the top response, followed by “There was not a healthy work/life balance at my previous job.” In the face of mounting crises, Gen Z and Millennials have been changing their lifestyles to cope with stress. Wanting to go into a different field/industry is another one of the top reasons young people told YPulse they have resigned or quit a job, and in fact, 29% of employed 13-39-year-olds say they have resigned or quit a job to combat stress/anxiety in the last year. Meanwhile, 26% of 18-39-year-olds tell YPulse they have taken time off from work or school, and 19% say they have moved to a new city or state to combat anxiety/stress in the last year.
Encouraging People to Stay
The pandemic gave people a new lens from which to view their lives, work, and integration between the two. There’s a disconnect between the many job openings and workers wanting their old jobs back. With nearly half of the workforce searching or being recruited for new opportunities, Vaughan-Nichols noted the Adobe survey sheds some light on why employees will elect to continue working in their current job/company:
- Proper company recognition.
- Pay raises.
- In-person and remote flexibility.
- Improved listening.
- Hours and schedule flexibility.
The Lever study noted that the biggest motivator for employees planning to stay in their position is salary and/or potential bonuses (46% of respondents said as much). This top-rated motivator was followed by attractive levels of paid time off and flexibility (21%) and internal mobility (13%).
Retooling Employee Retention Strategies and Rethinking Hiring Credentials
Let’s assume you have an attractive company culture, offer very competitive pay, and expanded your benefits to include PTO, caregiver leave, and better healthcare, what else will make a difference in your recruiting and retention strategies as you prepare your organization for the future of work? There are two key opportunities to consider: skills development and alternative credentials.
- Reskilling your workforce.
Gartner, Inc.’s 2021 HR Priorities Survey of more than 750 HR leaders found that 68% of respondents cited building critical skills and competencies as their number one priority in 2021. The survey, conducted from June through August 2020, found the other top HR priorities for 2021 are: organizational design and change management (46%), current and future leadership bench (44%), the future of work (32%), and employee experience (28%).
A LinkedIn survey revealed that 76% of Gen Z workers believe learning is the key to a successful career. Learning new skills and executive mentoring are appealing to this generation and are important to their future and how the companies they work for compete. Members of Gen Z and Millennials are also more likely than other generations to ask for role changes (36% and 43%, respectively), according to the Lever report.
“In the wake of the COVID-19 pandemic, HR leaders are moving away from crisis management toward focusing on what will make their organizations strong, both today and in the future, including having the right skills and competencies, building resilience and having a strong cadre of leaders,” said Mark Whittle, vice president of advisory in the Gartner HR practice.
According to the latest LinkedIn Workplace Learning Report, amid 2022’s storm of urgent priorities, skill-building and skills-based planning stand out as the most impactful places to make progress. While it’s natural to feel anxious that, for example, only 10% of HR and business executives say their organizations have a skills database with profiles for all employees, the report stated, “there’s a light in the dark clouds.”
The report goes on to say that organizations that shift to skills-based planning have a unique chance to catalyze learning culture and capitalize on emerging trends — especially the convergence of learning, talent acquisition, talent development, and the red-hot rise of internal mobility.
- Employees who feel that their skills are not being put to good use in their current job are 10 times more likely to be looking for a new job than those who feel that their skills are being put to good use
- 79% of Learning & Development (L&D) pros agree: It’s less expensive to reskill a current employee than to hire a new one
- 54% of L&D pros agree that internal mobility has become a higher priority at their organization since COVID-19
- Untapped Talent: The Rise of Using Alternative Credentials in Job Posts, Recruiting & Upskilling
Increasingly, U.S. workers are turning to alternative credentials to enhance and demonstrate skills and work-readiness, according to new research from the Society for Human Resource Management (SHRM), made possible by a grant from Walmart to the SHRM Foundation. SHRM’s new reports, The Rise of Alternative Credentials in Hiring, along with Making Alternative Credentials Work: A New Strategy for HR Professionals, found that nearly half of U.S. workers (45%) say they have some form of an alternative credential. Among those who don’t, about half (49%) have considered earning one.
But while employees and employers alike agree that alternative credentials bring value to the workplace and are instrumental in employee development, potential barriers to employers’ wider recognition of alternative credentials include a lack of systems that can easily identify an individual’s skills and talents, standards to recognize nontraditional or untapped talent, as well as employer reluctance to recognize a new way to validate these skills.
“Alternative credentials are key to uncovering untapped talent, especially when it comes to those job seekers who may not have the opportunity to build skills in a traditional way but have the competencies they need to succeed,” said SHRM Foundation President Wendi Safstrom. “A majority of executives, supervisors and HR professionals believe that including alternative credentials in hiring decisions can actually improve overall workplace diversity.”
Other key findings from the SHRM reports include:
- Alternative credentials are popular with U.S. workers: more than 70 percent of U.S. workers agree they are an affordable way to gain the skills or experience necessary to enter a new job and that having a job-relevant alternative credential increases or would increase their chances of being hired for a job.
- People who hold alternative credentials bring value to the workplace, according to executives (87 percent), supervisors (81 percent), and especially HR professionals (90 percent).
- During a time of skills shortages, alternative credentials can uncover untapped talent. It becomes easier for diverse candidates to obtain employment (81 percent of executives, 71 percent of supervisors, and 59 percent of HR professionals).
- Adjusting applicant tracking systems could help increase awareness of alternative credentials. Nearly half of HR professionals surveyed (45 percent) say their organization uses automated prescreening to review job applicant resumes, but only one-third of those (32 percent) say their automated system recognizes alternative credentials.
Ready to Remain Competitive?
If you are looking for ways to make your organization stand out, contact Casey Accounting & Finance Resources today. Let’s discuss the challenges you’re facing along with other hot topics in employee retention through upskilling and reskilling and considering alternative credentials in your job descriptions.