4 million Americans quit their jobs in July 2021, a figure that expands to 20 million if measured back to April (U.S Bureau of Labor Statistics). The US is experiencing what some are calling the “Great Reshuffle” and organisations are scrambling to keep up with the pace of attrition.
According to the Harvard Business Review resignation rates are highest in the tech and health care industries. But why is this? These are some of the industries that experienced extreme increases in demand during the pandemic and ultimately extreme burnout.
The pandemic has amplified employees contemplation about their work, and after a difficult year or more of working from home, lack of disconnecting, and general disruption it has led people to reprioritise and question what they do for work and why. It is coined the Great Reshuffle because it is more than just a great resignation. People are not simply resigning to work in a similar role elsewhere, people have re-evaluated and are changing careers completely, or taking a different approach to earning money. Europe has not yet seen the same level of reshuffle. However it is happening and can be seen in how challenging it has become to attract and retain talent.
Europe’s social democracy has allowed for less disruption in the workforce however that does not mean that Europe will be unaffected. The German Federal Employment Agency have said they will need to import 400,000 skilled workers a year to make up for deficiency in healthcare and tech industries. The UK has been seeing a rise in resignations also expectedly as they are the European economy most like the US.
Widespread sentiment also exists in Ireland. A survey by the Kemmy Business School WorkFutures Lab found that 41% of managers, 24% of site leaders, 39% of regional leaders and 19% of global leaders based in Ireland feel their future lies outside of their current organisation. So we can expect to see a large increase in the number of people quitting their jobs. It may not be to the same extent as the US and UK but Ireland will see some commotion.
“If You Fail to Plan, You Are Planning to Fail”
Benjamin Franklin
How can businesses prepare for this Great Reshuffle?
With less candidates in the market it is going to be worthwhile to consider candidates based on their skills rather than on their previous experience. It is expected that more junior workers will be accelerated up the ranks as companies struggle to fill mid-level and senior roles and will not have the luxury to look for 5 years previous experience in a similar role. If we trust in a person’s skills, capabilities and potential then the talent pool is immediately widened. In conjunction with this hiring outside of your industry will be important, considering candidates from other industries but with transferable skills will give your business a competitive advantage.
Implement a proactive recruitment approach so that you are prepared for any sudden resourcing changes and can act in a timely manner. It is important to be actively engaging with new talent rather than acting reactively as soon as someone resigns. Hiring with contingency in mind is wise. You may find a suitable talented professional that is available and active in the market now, should you wait until someone leaves and hope that they are still in the market then? Or do you consider the attrition rate and hire the person for their skills now knowing how in demand they are? When it comes to headcount it is not a time to play it safe! Be a long term thinker in a short term world.
It is going to be difficult for the in-house recruitment team to ramp up enough to cover an increase in vacancies. According to LinkedIn in June 2021, there were nearly eight times more recruiter jobs posted compared to June 2020, and over two times more than the 2019 average. For organisations that do not use external assistance in their current recruitment efforts they may consider using agencies or entering into an RPO agreement in order to scale up quickly. In an extreme case from the US this year online brokerage firm Robinhood purchased an 80 person recruitment firm Binc in order to rapidly expand their recruitment function in the midst of the Great Reshuffle.
As stated by Shahar Erez, long time tech industry master “All tech companies are complaining today they are unable to hire the talent they need due to a tech skills gaps, but they are not changing their strategic workforce planning”. With this in mind and in conclusion, even if the Great Reshuffle is not as damaging locally as it has been in the US there are ways that you can stay ahead of the game and be prepared for the worsening of this talent pandemic.
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