The Great Awakening: Competing for skilled labor in 2022

A recent SHRM report addressed why workers were quitting their jobs last year. It showed that three of the top reasons were the same today as before the pandemic: better compensation, better work/life balance and better benefits.¹

But what has changed in the COVID era — revealed two surprising reasons for workers quitting. The SHRM survey showed that 21% of workers quit because of lack of empathy by their leadership and 21% quit because of workplace culture.¹ This is likely because of "Covid Clarity," explained SHRM researcher, Ragan Decker, PhD., referring to the concept of workers thinking about what they want in a job and in their lives.

What these results show is that people still care about competitive compensation and benefits packages. But for many workers these are the basics, not the differentiators. The last few years have caused many workers to reevaluate their lives and reprioritize. The challenge for employers is they also now need to create a work environment where people want to work, and one that meets the work-life balance people seek, explained McLaughlin White.

"The power has flipped," said McLaughlin White. "Workers have more employment options today. They care a lot more about how their work makes them feel. And that's about culture. Do they feel valued? Do they feel like their work has an impact? Do they believe they work for a company they can be proud of?"

Given the value of a healthy workplace culture in retention, organizations should be thinking about whether they are fostering a sense of belonging that is inclusive and diverse throughout the organization from leadership to the frontline workers. And if not, how to make changes that would foster a sense of belonging.

Improving workplace culture isn't something that can happen quickly. It can take several months to years to feel real change. But a company can take steps to make quick changes that workers can see with open and honest communication, explained McLaughlin White.

"You can actually talk about where you are, where you want to be and how you are going to get there," said McLaughlin White. "Follow that with meaningful action and you start to see the culture shifting slowly. And with that, you start to build trust and respect among your workers."

"When workers feel a strong sense of belonging at their organization, they are less likely to leave," said Decker, referring to the SHRM survey.

Some companies are using a proactive approach by conducting stay interviews with their current employees. Managers engage their workers in a conversation with standard questions to gain a better understanding of why they are staying and potential reasons on why they might quit. This approach enables employers to identify issues and address them before their workers quit.

Bonus for stay interviews: managers may find that as they conduct their stay interviews they are also developing a more empathetic view toward their workers. And with more empathy, stay interviews are doing double duty to help lower the inclination for workers to quit their jobs. 

Employers are offering a range of new benefits. Voluntary benefits such as disability, critical illness, dental and life insurance offer workers valuable, affordable coverage that can be customized without adding costs to the bottom line. Dental insurance has become very popular in the last few years. Many employers are picking up a portion or all the premium for voluntary benefits which can help cushion the impact of out-of-pocket medical expenses.

Benefits bank: small employers on a tight budget are setting up a benefits bank with a fixed contribution amount for each worker they can use toward benefits of their choice. 

For employees who can do their work remotely, more companies are using hybrid and remote schedules to increase their retention. In the past six months, 45% of employers survey have offered remote work or flexible work options.¹

Consider tapping into these three talent pools to recruit employees:

• Former employees who quit
• Newly graduated students
• Veterans

Former employees offer a potential rich source of prospective hires. Nearly a quarter of former U.S. employees who quit their last job have considered going back. Other great sources for untapped talent pools are newly graduated students and veterans.

The Great Resignation and the Great Reshuffle are reminders that effective strategies for retention and recruitment don't stay the same. In this competitive labor market, organizations that really listen to their employees and adapt to their needs will have a better chance at retaining their skilled workers and keeping them engaged than if they relied on the pre-pandemic tactics.

1. SHRM Research Institute, The Great Resignation: An Analysis of the Employee Experience, 2022.