The Great Resignation – Were you one of the 20 Million people?
Insights from experienced financial professionals.
The COVID-19 Pandemic has accelerated many things for all of us - from curbside pick-up being a dinner staple (hence the thermal bag in the backseat of our cars), to Zoom meetings where at least one of us forgets to hit the unmute button before speaking!
What has been most surprising was the amount of people that decided to quit in the second half of 2021.
As a Firm, we help members and clients when changing jobs for any reason - but 20 million resigning is… unprecedented. If you have changed jobs or decided to quit, it’s helpful to reflect on the impact this will have on your journey toward Financial Independence. Whatever the reason, we are here to help!
Whether it is the prevalence of hiring signs throughout the country or the changes in business hours due to lack of staff, the changing workforce is becoming more and more apparent with each passing season. Businesses are trying everything from pitching better pay, to improved benefits to signing bonuses, all in the hopes of hiring more staff.
The Great Resignation
Some refer to the second half of 2021 as the "Great Resignation," after more than 20 million people quit their jobs. Many researchers contended that shutdowns and time off work during the pandemic brought people a moment of reflection, where they started questioning what they wished to do with the rest of their lives. With changes from how the world does business to the new incentives that companies offer, many people decided to take the leap and seek a new job or career that may better fulfill their needs.1
When people switch jobs, retirement may not be top of mind. It’s important to know your options for your existing retirement accounts and what the new employer offers. Make an appointment with one of our Advisors if you fall into this category. We can help!
Why Are Employees Deciding to Quit?
For those close to retirement age, the changes brought about by the pandemic may have sped up the process. For some, the current incentives by businesses and openings in various fields may have encouraged people to look for jobs that may better fulfill their financial needs and passions. Many more women than men quit the workforce, which could be because women are the predominant child caregivers. During the pandemic, shutdowns of schools and day care centers caused complications for some women in the workforce.1
Who Is Leading the Great Resignation?
Employees between 30- and 45-years old account for more than 20% of the total employee resignations. Even though that is a significant increase for this age group, in terms of leaving the workforce, studies show that younger ones, aged 20 to 25, had the highest turnover rates. This age group faced the most significant financial uncertainty during the pandemic as demand for entry-level employees declined.2
While the sting of employees quitting impacts almost every industry, resignation rates are highest among those mid-way into their careers. As employers increase their workforce, with smaller numbers of staff than before, mid-career employees are finding the greatest opportunities and they require less training and may be able to handle multiple job tasks with the experience they have.2
Studies found that jobs with increased demand during the pandemic saw the highest rates of resignations, such as positions in the tech and health care industries. In those sectors, resignation rates were 3.6% to 4.5% higher year-over-year than pre-pandemic levels with many of the resignations stemming from the result of excessive workloads and job burnout.2
1 The Great Resignation: Why more Americans are quitting their job than ever before, CBS News, https://www.cbsnews.com/news/great-resignation-60-minutes-2022-01-10/.
2 Who is Driving the Great Resignation, Harvard Business Review, https://hbr.org/2021/09/who-is-driving-the-great-resignation.