Australia facing the 'Great Retention', not the 'Great Resignation'


Australia facing the 'Great Retention', not the 'Great Resignation'

First coined by professor Anthony Klotzto to describe the increased staff turnover experienced by businesses in 2021, the ‘Great Resignation’ has since been referenced more than 232 million times online. Unfortunately this term has widely been adopted by business leaders to blame disloyal employees rather than a catalyst to reflect on poor workplace culture. But despite the adoption of the ‘Great Resignation’ globally, is this phenomenon reflected in departure data? And why should we focus on the ‘Great Retention’ instead?

The ‘Great Resignation’ is believed to be a result of COVID-19, where companies inadvertently set new standards for work-life balance allowing employees to work from home en masse, followed by a wave of departures once staff were required to return to the office. However, resignation rates have been on a continuous rise pre-pandemic, and saw a drop for the first time during the pandemic.

The average monthly quit rate in the US increased by 0.10 percentage points each year from 2009 to 2019 (Harvard Business Review, 2022). In 2020, these rates dropped as mass redundancies saw extreme uncertainty for those that were able to work remotely. In 2021, businesses saw a mass exodus of staff, which included the staff who would have quit in 2020 had the pandemic not existed. In short, no more people than otherwise predicted quit, meaning that the ‘Great Resignation’ is not so great after all.

I believe the shift occurring within the workforce is not the ‘Great Resignation’rather, the businesses struggling to fill these positions with great talent need to reflect on their practices to focus on the ‘Great Retention’.

People are putting their wellbeing as a first priority over their work arrangements. A recent qualtrics survey found that around four in 10 millennials and Gen Z respondents say they’d leave their job if asked to come back to the office full time. This is further supported in a study conducted by HR firm Randstad 2022 which indicates that 55% of millennials would quit their job if they were being prevented from enjoying a balanced life.

Australia is experiencing a “great reshuffle” as described by Treasurer Josh Frydenberg earlier this year. As the work-life balance is preached by businesses, workers are experiencing a cultural shift and adapting as needed. So, how can businesses retain staff?

There is no doubt that the workplace is evolving. We are now seeing 4 day work trends, and flexible hours and locations. This is representative of a modern working environment with benefits for employees to help balance the work and social schedule. Even as the workplace is developing and creating the new ‘normal’, the work still stays the same. Employers offering staff remote work, additional leave, and four day weeks at full time pay have a competitive advantage when it comes to the hiring process and existing staff are less likely to move onto another company if they cannot match their current job’s offering.

Overall, the cultural shifts occurring in the workplace are being seen globally but the number of people resigning from employment remains steady. Although the media is making it out to seem that the pandemic is the singular cause of people resigning, the evidence is made clear above that this is not the case. Larger numbers of people will continue to resign, however this is not new.

As the People & Culture Manager at Partners Wealth Group, one of Australia’s leading providers of business and financial advisory services for individuals, families and business owners, and recently awarded Best Place to Work 2022, I am convinced that the ‘Great Resignation’ never existed. It is at best poor HR jargon to qualify many departures within a company, at worst a pretext for leadership teams to avoid robust discussions in understanding what’s important to each individual (and their family), and  therefore what makes their employees remain in their position.

The challenge for business leaders is achieving the ‘Great Retention’, by continually evolving their work practices for the benefit of employees, communities, and organisations.

Click here to read more about Partners Wealth Group placing in the top 10 of AFR BOSS Best Places to Work.

Millennial research:

  • Study from HR firm Randstad 2022 (article here)
    • 55% of millennials said they would quit their job if it was preventing them from enjoying life, compared to just 38% of Baby Boomers
    • 40% of millennials said they wouldn't mind earning less if they felt their job was contributing something to the world or society
  • Qualtrics International survey (article here)
    • About four in 10 millennials and Gen Z respondents say they’d leave their job if asked to come back to the office full time
  • Study by EY (article here)
    • Nine in ten respondents want flexibility in where and when they work, with millennials twice as likely to quit as baby boomers