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Report

The employee turnover tsunami is here

Research from Eagle Hill Consulting reveals that 27% of employees plan to leave their organization once the COVID-19 pandemic is over—29% expect to leave within the next year. Those numbers jump to 33% and 36% respectively for Millennials. What can companies do now to face this wave of change?

People are making the leap

At the beginning of the year, we predicted that many industries could anticipate a tsunami of employee turnover when the pandemic eases. That time is now.

After a year and a half of pandemic life, the United States is opening up again, and the economy has started to recover. Just shy of 70% of the adult population has been vaccinated, according to the CDC. And Washington Post reports that nearly a third (32%) of workers are back in the office. Analysis of U.S. Bureau of Labor Statistics data released in July shows that job openings grew by 69% compared to the same period last year.  

These changes bring new opportunities for employees to make job, career and life leaps that were mere ideas, notions and dreams during the pandemic. This possibility to take action is at the heart of the turnover tsunami—a different kind of turnover trend than employers have seen before. The tsunami is being fueled by complex forces that have a compounding effect on each other. It is occurring in a landscape where so many aspects of business have been profoundly altered—from business models and customer demands to competitive dynamics. This reality raises the stakes for managing turnover proactively.

Companies need strategies to manage this massive wave of employee turnover so they have the skills, roles, and talent to support future growth. Employees aren’t waiting to act. Neither can employers. 

Employee turnover comes from a sea of impacts

By simple definition, a tsunami is a series of huge waves caused by a massive force shocking the ocean—an earthquake, a volcanic eruption, or even a meteorite. In the case of the turnover tsunami, that massive force is COVID-19. It caused a sea of impacts that have begun, and will continue into the future.

Burnout: Psychic weight is heavy

While employee burnout was an issue prior to the pandemic, it has intensified since, becoming persistent and pervasive over time. Our poll reveals that 53% of U.S. employees report burnout. Millennials are the most likely group to experience burnout—60% say they are burnt out.

Just over half (52%) of those surveyed say that workload is the top cause of their feelings of stress. People also say that juggling their personal and professional life (44%), lack of communication and feedback (41%), and time pressures (37%) are causing their feelings of burnout. All of these drivers are at their highest levels since we began surveying employees on this issue in April 2020.

Employees who report burnout are three times more likely to leave their organization after the pandemic is over compared to colleagues who are not burnt out—39% vs. 13%.

Source: Eagle Hill Consulting

While work-life balance issues were the top drivers of burnout during the crisis, employees are now feeling the pressure of increased workload more acutely. This could be because turnover in their teams has meant more work for them. Regardless, employees often see leaving as the only way to address burnout. With more job openings than there have been in months, they have both the choice to leave and the choice of jobs.

Necessity: Crisis is a forcing function

During the height of the pandemic, employees left the workforce out of necessity. This was often to help children with remote learning or to address caregiving responsibilities for elderly parents and family members. More women than men quit the workforce. Even with the move back to “normalcy,” women may need to continue in these pandemic roles. As a result of this and a raft of complex reasons—from pay inequity to the pressures of being “superwoman”—some women may never return to work.

More than 2.3 million women left the workforce between February 2020 and February 2021.

Source: National Women’s Law Center

Choice: Opportunity comes from crisis

People had time to reflect, reassess, and recalibrate their priorities in their personal and professional lives during this crisis. They determined how to live their best life. This introspection coupled with a “life is too short” spirit is fueling career pivots among people who would never have made such high-risk, high-reward moves before. The pandemic has also shifted norms around ways of working that employees have come to appreciate and expect. For example, if they have discovered that they enjoy remote working, and their employer insists that everyone go back to the office full-time, employees may be inclined to seek those options elsewhere. With the job market the way it is in many fields, they have good reason to feel confident they can find a new job quickly.

46% of the global workforce plans to move because they have the option to work remotely.

Source: Microsoft

Pent-up demand: The flood gates are open

Many employees were in survival mode over the last months—focusing only on basic needs as opposed to growth needs. Even some who have struggled with burnout, been challenged by work-life balance issues, or who have had a career epiphany stood still. There are many reasons for this, and every person is different. But with vaccines widely available and the worst of the pandemic hopefully over in this country, employees have reached the “light at the end of the tunnel” moment. It is a time when people feel they can make the moves they were putting off. And the flood gates of employee turnover are wide open.

A third of Millennial employees (36%) are likely to leave their organization in the next year.

Source: Eagle Hill Consulting

How to stem the tide

Employers are all too familiar with the consequences of employee turnover—that it has a negative effect on the bottom line, productivity, morale, and corporate reputation. With this wave of turnover crashing, companies must brace for these things as always. However, they must also brace for new challenges. Not only do they have to solve for attrition, companies must do it in a competitive talent market while driving growth in a new business landscape. They can “get on higher ground” with capacity and workforce planning.

Bounce forward, not back. There is a knee-jerk reaction that often happens when managing turnover. Companies default to backfilling roles with the same skills. But bouncing forward doesn’t mean going back to where things were. It means identifying and cultivating new skills through upskilling, reskilling, and in hiring practices. This is an opportunity for businesses to redefine the talent they want—and need—now and for the future. For example, companies that introduced automation during the pandemic may now realize that they need people with more analytical skills and less transactional skills. 

Think creatively, act strategically. The pandemic taught companies to be more creative in how they fill roles and source skills. By reallocating talent thoughtfully, companies can fill talent gaps and help reduce workload burden, motivating employees and addressing burnout. When companies find their next normal, they will not have to revert to the old approaches for bringing in skills. The talent pool is deeper. Companies can weigh the options and trade-offs of on-demand models and gig workers, partnerships, and global resources. 

Keep top performers engaged. Companies should identify and engage high performers for obvious reasons—and because studies show they are the most susceptible to burnout. To help A players feel valued and excited about staying with them, companies should focus on their career growth. This includes things like targeting A players for stretch exposure, offering exclusive training, or being more transparent about career progression and compensation. Stay interviews provide insights for creating a differentiated employee experience for each high performer.

Listen to employee needs, then listen again. Companies did a lot of talking to employees about everything from policy changes to the logistics of remote work during the crisis. This is good. But as important as it is to talk to employees, it is equally important to listen to them. Conducting employee surveys, encouraging “open door” exchanges, and providing career counseling and mentorship opportunities are all effective ways to do this. With employee views changing so fast, it is key to pulse employees regularly because yesterday’s needs won’t necessarily be today’s.

Take action swiftly and proactively. There are many ways that companies can identify unmet employee needs before they turn into people walking out the door. For example, employees’ desire to continue working from home more frequently than they did before the pandemic could make or break their decision to stay with a company, especially as they see other organizations prioritize and prepare for a hybrid workforce model. Listening for employee voice on issues like this is essential, but proactively controlling potential turnover can only happen when employers act on what they hear.

Communicate and avoid unwanted surprises. As employees consider other job prospects, they’re balancing trade-offs between the “known” and the “unknown.” Companies still have a lot to sort out around the return to work. Employees seek certainty in a time of uncertainty, and many may be attracted to organizations that have (or seem to have) answers to the questions they’re asking about the future. Organizations can take the guesswork out of employee decisions, and retain more of their workforce by sharing and communicating new policies, plans, and procedures openly and proactively.

Managing the turnover tsunami well means balancing tactical decisions for today with strategic workforce planning for tomorrow. That’s how companies can address where they are—and where they want to go. For the business and for their people.

Methodology

The Eagle Hill Consulting COVID-19 Workforce Burnout Survey was conducted online by Ipsos on May 12-17, 2021 and November 12-16, 2020. The online survey included 976 and 1,003 respondents respectively, from a random sample of employees across the United States. The survey polled respondents on burnout and retention in light of the COVID-19 Pandemic.