The long-lasting effects of the pandemic– permanent hybrid work, individuals rethinking the place of work in their lives – have fueled higher voluntary turnover over the past few years. In this new reality, including today’s economic uncertainty, organizations must take a more proactive approach to their recruiting and retention strategies.
We spoke with Caitlin Duffy, Director in the Gartner HR practice, to discuss the factors that are influencing today’s job churn, and how HR leaders can prepare for the future.
Q: How should organizations approach hiring and retention amid the news of mass layoffs across several industries?
A: Our research indicates that today’s layoffs are more of a ripple than a wave. Even in the tech industry, where we’ve seen some especially public layoffs recently, it’s a drop in the bucket compared to the overall increase in job postings over the past few years. In recent discussions we’ve had with HR leaders, very few are planning layoffs in the next three months.
In fact, many leaders today recognize the importance of using workforce reductions as a last resort. Layoffs can seriously harm morale, damage productivity and increase the risk of attrition in critical talent pools. So, although these layoffs might provide a marginal cooling effect on the labor market, organizations that continue to prioritize hiring and retention can gain a competitive advantage in today’s new talent landscape.
Q: The pandemic has fueled higher voluntary turnover. Is this trend likely to continue?
A: We’ve seen what employees want from their employer substantially shift since the pandemic started in 2020. Most employees want their organization to see them as a person, not just an employee, yet less than half believe their organization actually sees them this way.
Changing employee desires, combined with the rise of hybrid work making it easier to change jobs in a labor market with fewer geographic barriers, have led to a significant increase in turnover. In 2022, Gartner estimates annual turnover in the U.S. has jumped nearly 20% from pre-pandemic numbers.
This rising turnover is not a momentary blip, but rather a fundamental shift for the U.S. workforce. Moving forward, organizations need to proactively address the implications across areas such as recruiting, internal talent mobility, and employee experience.
Q: What issues are intensifying today’s higher job churn?
A: First is the mainstream adoption of hybrid and remote jobs. Employees have gained access to a far wider range of employment options than they had before, and they have more freedom to pursue roles more attractive than their current ones.
Second is changing employee expectations. Gartner research shows the pandemic has caused most employees to rethink the role work plays in their lives. In fact, many employees have said the pandemic shifted their attitude toward the value of aspects outside of work. Many employees want a more flexible schedule that accommodates all of their priorities, and they say flexible work policies will impact whether they stay at their organizations.
Q: What should organizations consider when dealing with a high-turnover future?
A: To attract and retain talent today, organizations need to let go of outdated, office-centric work design and shift to a human-centric work design. A human-centric work design revolves around what’s best for employees – completing work to the highest standard and accommodating their personal lives.
Progressive leaders also understand the need to prioritize employee well-being in their talent management strategies to prevent burnout and enable employees to thrive.
Q: How is economic uncertainty affecting turnover?
A: Faced with a potential recession, many leaders are opting to take back more control of their workplaces by mandating a return to the office. To these leaders, having workers in the office provides a sense of visibility and consistency while allowing for the serendipitous interactions with others that they believe are critical to collaboration and innovation.
Yet, what we’ve seen over the past few years is that employees are just as able – if not more so – to collaborate and innovate productively in a hybrid work environment, as long as it’s designed in an intentional way. In fact, Gartner research shows employees who are allowed to decide when they work are 2.3 times more likely to achieve higher performance and 2.3 times more likely to stay with the organization.
Moving forward, it’s critical that organizations support executives and managers in understanding the value of hybrid work and shifting the culture to recognize it as an essential piece of the employee experience. This includes providing guidelines around how to balance synchronous, collocated time for teams at the office with asynchronous work done at home.
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