Responding to the "Great Resignation"

The employment environment is changing, with resignations close to all-time highs.

Workers have more bargaining power than they have had for years," according to The Economist. adding that "employers offering low wages or poor conditions are struggling to fill positions."

Many have termed this The Great Resignation. Issues such as "burnout, workload, poor culture, and lack of flexibility", mixed in with the long-term effects following returning to work after the pandemic, have caused many employees to think again about their existing roles. When organisations have experienced multiple resignations and failed to hire replacements, but with no reduction in workload, existing employees are all the more likely to resign in numbers.

In August 2021 the number of available jobs in the UK exceeded one million, the highest figure on record. It is therefore vital that businesses begin to understand the reasons why the Great Resignation is happening, the underlying factors behind it and what can be done in response.

Much has been written about the mobility of millennials and GenZers (Generation Z - those born in and around the first decade of the century), but a Harvard Business Review survey found that resignation rates are highest among mid-career employees between the ages of 30 and 45. The survey said: "Many of these workers may have simply reached a breaking-point after months and months of high workloads, hiring freezes, and other pressures."

Numerous companies are now using third-party vendors to plug the resulting staffing gap, particularly where operational resilience is a priority. In a recent survey we conducted, which will be published in May 2022, Thomson Reuters found that 'the rise of third-party vendors has made resourcing easier?. We have found this with our customers who use the Confirmation platform to free up manual, time consuming tasks in order for teams to focus on more meaningful tasks.

For firms building up their own talent base, it is vital to create a positive company culture with characteristics such as flexibility, inclusivity and respect. In a Sloan Management Review article from March 2022, Why Every Leader Needs to Worry About Toxic Culture, the authors identify the decisive factor driving attrition as a toxic culture, almost always created by the leadership team.

Companies offering a hybrid model are less likely to be affected by attrition, with 28 per cent of workers saying that flexible working policies are encouraging them to stay in their current job. An August 2021 Gartner report, Redesigning Work for a Hybrid Future, stated that by going back to an office-centric model a company could lose up to 39 per cent of its workforce.

A Journal of Accountancy article highlights inclusivity as a means of retaining and hiring talented individuals, saying that "more finance teams are wanting to increase retention, wanting to upskill, wanting to ensure that their teams are diverse".

Organisations should therefore be "implementing gender equity policies to hire, retain, and promote women, and tapping the return-to-work talent pool and being welcoming to applicants from different generations". This inclusive search for talent should, for example, embrace neurodiversity, which can help businesses become more effective and successful. "This approach is about helping everyone to thrive and seeing everyone as talent, no matter how their brain works."

The American apprenticeship scheme for certified public accountants exemplifies another perspective on recruitment - one that has also been adopted in London - in order to encourage candidates from less affluent backgrounds. "An apprenticeship widens the aperture of the lens through which an organisation can look for candidates. It basically increases the talent pool."

UK Finance has partnered with the I Have a Voice initiative, whose mission is to create employment opportunities in the public affairs sector for young people from backgrounds that are under-represented in the sector and world of politics.

The financial organisations that apply this more open-minded view and look across all of society are better able to discover and recruit a diverse range of talented employees - the 'talent upgrade? that our survey's 200 heads of tech are seeking. And developing a respectful, positive company culture is essential for retaining staff, as well as sending a welcoming message to potential joiners.

These two closely connected strategies - together with drawing on contingent resourcing - offer the likeliest way for firms to survive the Great Resignation.

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