How the Great Resignation Changed the World
Just as the global pandemic has ravaged every society, the economic front also saw a lot of businesses shut down while leaving a lot of people out of their jobs. However, there is also a phenomenon that caused massive resignation en masse (particularly in the United States) in 2021. The Great Resignation, also known as the Big Quit, is viewed as a kind of general strike against governments refusing to provide necessary worker protections thereby causing wage stagnation and the rising cost of living.
Although some opt for sabbaticals or early retirement, there are those who are leaving the rat race entirely for personal reasons. On the flip side, some have taken advantage of the opportunities to reinvent their careers since the current job vacancies have opened up better positions. Others have considered working for themselves and starting their own businesses to fill in the gap left in the pandemic-hit market.
What’s Driving It?
Normally, high quit rates are triggered when there is high economic stability and low unemployment rates. Worker confidence in their ability for career advancement and getting higher-paying jobs takes a hit. On the other hand, resignation rates tend to decrease when there’s high employment because hire rates tend to decrease. That means, more people are likely to hold on to their jobs.
Although resignation rates followed the usual pattern during the start, massive resignation happened as the pandemic continued to this day even though there is high unemployment and continued labour shortages. As governments are forced to implement social distancing, travel restrictions, and vaccination measures to stem the spread of the pandemic and ease the transition to a restart of economic activities, many have been forced to rethink their careers and long-term goals due to these prolonged roller-coaster shutdowns and reopenings.
Why Workers Quit?
Work conditions have changed as many workplaces require work from home while some have opted for remote employees to cut costs. With many people now working from home, it has opened their desire for more freedom and flexibility to achieve a better work-life balance. Businesses that require in-person interactions were the hardest hit. Workers who rely on those low-wage jobs have been forced to ask for unemployment benefits, which have been slowly rolled back.
Numbers have shown that those looking for new jobs look at the following priorities: flexible work arrangements (56%), higher pay (53%), and job security (47%). Frontline workers, especially in the service and medical sectors, are facing higher virus exposure risks. As a result, more than 33% of service workers plan to quit within the next three months due to difficulty dealing with customers. Burnout has led to record high resignations of nurses and medical staff. Increased workload also forced workers in customer-facing businesses to throw in the towel as well.
Work dissatisfaction is on the rise with Millenials and Generation Z workers with over 50% of the latter looking for a new job within the next year. Personal priorities have changed especially those affected by COVID as their ability or desire to work is altered for good.
Labour movements have helped shape the boom-bust cycle of global economies especially in the aftermath of the Spanish flu and both world wars. Large-scale acts of protests and work refusal has led to landmark changes in labour laws.
Taking a cue from the massive strikes in France a century ago, today’s labour force is using the labour shortage as a bargaining chip to improve working conditions and wages, especially in the gig economy. The demographic shift could also influence how the labour landscape would look as migrant workers would have a bigger say as the developed and industrialized countries have an aging workforce. Some businesses look to implement labour-saving technologies with artificial intelligence, machine learning, and robots to reduce reliance on people.
Some say that the roaring twenties will be back as optimism is expected to rise once we all moved on to the new normal. Well, it sounds so familiar then when we are all living in a world of economic dislocation and social inequality. Let’s face it, people want to enjoy life once again so that all those pent-up businesses and consumer demands would either bring back more people to the workforce or force people to do whatever they want with their newfound “freedom.”
Reinvention of Labour
As this newfound freedom has opened up new choices and opportunities, more people can now choose thousands of new roles that are previously off-limits. Businesses can attract more global talents so that the need to adopt new working models tuned in to hybrid and remote arrangements is more important than ever before.
Movement in the job market is more like a reshuffling of workers looking to make a career shift. People would be job-hopping until they find that work that provides perks that match their preferences. However, there is a greater risk for older employees who have already built their career capital and so many younger employees in entry-level positions are more likely to move jobs. In the end, people would end up settling down with their choices as they seek normalcy.
There is a unique phenomenon in China called ‘tang ping’ where young people have chosen to reject societal pressures on hard work (brought about by their 996 working system) with an indifferent attitude towards life by doing the bare minimum to get by. Some say it’s more than just a lifestyle choice and view it as a social protest movement against state control.
In Japan and South Korea, there is a growing demand for better work-life balance to reduce cases of “karoshi” or “gwarosa” (death by overworking). As a result, their governments have launched initiatives and measures to limit overtime and work hours while also adding day-offs and vacation leaves.
Those who stayed in the opposite pole of the Great Resignation are left behind handling multiple roles and increasingly greater responsibilities. According to a study on the impact on workers who stay:
- 55% wonder if the pay is high enough
- 30% struggle to get work done
- 28% more lonely or isolated
- 27% feel less loyalty to the organization
With mental health issues and burnout setting in, more than 40% of those still employed are thinking about quitting too. Whether they decided to go through it or not, this resignation chatter can be like an infectious virus unto itself. Companies have to maximise productivity even with limited workers on board.
Finding the right balance between meeting what employees want and what employers need is tough. With more people out of the workforce, many businesses are struggling with labour shortages even with record job openings. All these issues compound so that governments struggle to reopen the economy as consistent turnovers force a lot of businesses to shut down and close for good thereby contributing to the rising prices of consumer goods and extending the supply chain constraints.
Efforts have been made to reduce burnout, improve work conditions, provide better pay, and enforce a better work-life balance. Only time will tell if this Great Resignation will last longer than everyone expects.
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