Over the past couple of years, we have seen a broad array of issues develop that have been plaguing the workforce, primarily due to the COVID-19 pandemic. Many of these issues existed prior to 2020 but were exacerbated by the pandemic.
But what specifically has caused this? The change in working models has been a major adjustment for employees and leaders alike who have had to adjust to this new normal. Not to mention the financial uncertainty that the last two years has caused, both for workers and businesses.
Because of this we are seeing in real-time problems rise to the surface, problems that include high turnover, low productivity, burnout, stress, and lack of motivation. These issues should be a major concern to the workforce.
Diving Into High Turnover
High turnover is a trend that we are seeing in real-time and the data bears this out.
According to the Bureau of Labor Stats, “the average annual turnover rate is 57% across all industries”. This is an alarming statistic, however, it is one that tells us quite a bit. The fact that this is taking place across all sectors proves that this is an issue endemic to the entire workforce. It is worth pointing out that the 57% figure cited by the Bureau of Labor Stats is just an average figure, turnover tends to vary industry by industry. The tech industry for example has a turnover rate of 20.9%, a number that has raised alarms to those within the tech space.
The price of employee turnover can be incredibly high – literally. The cost of advertising, recruitment and relocation is immense. This is on top of the damage this does to an organization’s morale.
But what is causing this? An organization with a toxic culture tends to have higher numbers of turnover. “47% of active job seekers cite company culture as the primary reason that they left their employer. While turnover rates do not necessarily mean an abundance of toxic company cultures, the unusually high stats as of late suggest it. “While some periods of turnover are natural, chronically high turnover can be symptomatic of a company culture that leadership needs to act quickly to remedy,” said Grill-Rachman. The scenario that Grill-Rachman describes is exactly what is happening within the workforce in 2022.
What’s the Solution?
The issue with employee turnover is a big one. However, it is not one without a solution. Much of this work will fall onto leadership as well as the cultivation of positive company culture – two things that should exist in tandem. The positive impact that leaders and positive company culture can have on their people is immense. This impact has the potential to stunt the alarming turnover rates, inspire higher productivity, help alleviate burnout/stress and motivate employees.
The strides that leadership makes to make their people feel seen and heard are proven to be effective. For instance, “63% of people who receive regular recognition (from leadership/managers) say they're unlikely to seek employment outside their current company” according to The Center for American Progress. Meanwhile, “79% of employees will quit after receiving inadequate appreciation from their manager”.
However, while many recognize the need for strong leadership in the face of high turnover, it’s a skill that is not always innate. In a report conducted by Deloitte titled “High-Impact Leadership Development,” Only 60% of leaders in organizations show commercial acumen and business judgment; 48% are seen as driving change and innovation, and only 44% build talent for competitive advantage”. This shows a need for leadership development initiatives within organizations.
Creating Strong Leadership Within Organizations
High turnover is an issue plaguing the workforce but can be eased with strong, empathic leadership. While it may be true that in some organizations, effective leadership skills can be in short supply. However, showing your people that you are appreciative of their work and leading with a genuine, mature, authentic presence can help retain them.
When attempting to strengthen your leadership capabilities, recognizing the accomplishments and strides that your people are making can be pivotal. For instance, “63% of people who receive regular recognition (from leadership/managers) say they're unlikely to seek employment outside their current company” according to The Center for American Progress. Meanwhile, “79% of employees will quit after receiving inadequate appreciation from their manager”. At the end of the day, your ability to recognize and appreciate your employee's efforts will help retain them.
The maturity level of leaders is something that is essential. Much of this work will fall onto leadership. According to the Bersin by Deloitte report High-Impact Leadership Development, organizations with stronger “leadership maturity” are 11 times more likely to have a high number of leaders who can build talent for competitive advantage. They are also 7 times more likely to have a high number of leaders who can inspire people to follow them.
Now, while recognition and appreciation are important, they are just one piece of the puzzle. There is a large ecosystem of work that goes into retention and the creation of a successful culture. There are other factors that have to be taken into consideration. Alignment, which is a core element of the Chakras of Business, is key. Aligning your values, purpose and vision is essential to this process. Some of the other puzzle pieces involve:
Developing clear and open communication
Fostering a feedback culture
Building connection, belonging and relationships
Leading from the heart
Making decisions that are both strategic and intuitive
These are all practices that we preach within our methodology. Follow us along on this journey for more tips or get in touch if you are ready to fully dive in! The Opportunity for the Workforce While the issues discussed here are cause for concern, they also represent an opportunity. An opportunity to create thriving organizations through enhanced leadership capabilities, improvements to company culture and the implementation of employee development programs. In this article we have primarily focused on high turnover, however, issues of low productivity, burnout/stress, and lack of motivation are huge issues as well. These investments will allow the collective workforce to come out of this period stronger than ever. Sources:
“19 Employee Retention Statistics That Will Surprise You (2022 ).” Apollo Technical LLC, 7 Apr. 2022, https://www.apollotechnical.com/employee-retention-statistics/.
Heinz, Kate. “40 Employee Turnover Statistics to Know.” Built In, 24 Feb. 2020, https://builtin.com/employee-turnover-statistics.
Agovino, Theresa. “To Have and to Hold.” SHRM, SHRM, 6 July 2021, https://www.shrm.org/hr-today/news/all-things-work/pages/to-have-and-to-hold.aspx.
Bersin, "High Impact Leadership" Deloitte, July 2017, https://www2.deloitte.com/content/dam/Deloitte/ca/Documents/audit/ca-audit-abm-scotia-high-impact-leadership.pdf
“Psychometric Tests & Personality Assessments.” Psychometrics Canada, http://www.psychometrics.com/.