Workers are quitting in record numbers across the globe. In the US alone, the “Great Resignation,” an unprecedented voluntary employee departure, is seeing four million employees leave their jobs each month. Many companies are experiencing elevated rates of turnover across job levels, with hourly and entry-level employees presenting the most risk.
As we move into the second quarter of 2022, the Great Resignation continues to have an enormous impact on organizations. Aside from the cost of replacing the employees, which can be as high as twice that of an original employee's salary, high employee turnover adversely influences organizational culture, productivity and engagement levels.
It’s counterintuitive, but employees are engaged
When most leaders see an increase in turnover, they tend to assume decreasing engagement levels.
But that’s not what our research is showing.
Our global normative database — which includes global data from more than one million employees every year — shows employee engagement is now generally at prepandemic levels. The engagement numbers arrived at the current point after an increase in the first year of COVID-19 and a decline in 2021. So another factor must be driving the Great Resignation.
Employee stress is acute, and their stressors have changed
According to a scientific brief released by the World Health Organization (WHO) in early March 2022, the global prevalence of anxiety and depression increased by a massive 25% in the first year of the COVID-19 pandemic. As The Lancet estimates, so far, a staggering 53 million new cases of major depression have developed globally as a result of the pandemic.
The trend is echoed in Mercer’s 2021 Health on Demand report. We surveyed more than 14,000 employees across 13 countries, and the results clearly show a devastating wave of mental ill health. Employees are more stressed than ever. Nearly one in five employees (17%) worldwide describes being highly or extremely stressed daily, with employees in the US (25%) and Mexico (24%) reporting being the most stressed. One in five feels more lonely or isolated than before.
Even as the world learns to live with COVID-19, employees are now significantly more concerned about their physical health, work-life balance and emotional well-being compared to before the pandemic when employees were more worried about aspects of their jobs, job security, their bosses or their professional development.
The heightened stressors are changing what employees are looking for from work
As indicated, in the past, employees often focused on their careers. In the wake of the pandemic, employees are prioritizing their physical and mental health, so they are looking for jobs that meet their holistic needs, both inside and outside work. People want healthy experiences, and they are willing to leave jobs that put their lifestyles at risk.
For example, one recent study found that 42% of employees would quit if their companies didn’t offer remote working options long term.
This is the emergence of what we’re calling the “Lifestyle Contract.” The Lifestyle Contract is superseding the Engagement Contract, which dominated the workplace over the past 20 years. Organizations were attracting and retaining talent by emphasizing the provision of work that was intrinsically motivating and psychologically fulfilling. Now, they need to do things differently.
How can employers fulfill the Lifestyle Contract?
Speak with a consultant