The Great Resignation is making headlines around the world, but what it is and why it’s happening are interpreted in wildly different ways. Are people leaving their jobs because they are lazy? Because they feel unsafe? Because they get better offers? Let’s take a fact-driven approach to find out why people leave jobs. 

Great Resignation: Fact or Fiction? 

Understanding why people leave jobs is critical information for company leaders, as well as for staffing, recruiting, and HR team members. The data affects both a company’s tenure and turnover metrics, as well as their recruitment and staffing success. But Europe has had staff shortages in critical industries since at least 2018: are we seeing something new? And are these changes here to stay?

Much of the media hype about the Great Resignation refers to job vacancy levels. Headlines announce massive labor shortages throughout Europe, but a closer look reveals that most of those shortages are due to long-term demographic and economic changes: they aren’t a recent phenomenon. And, while unemployment levels in Europe have increased since 2020, they are still far lower than in 2013, when unemployment reached over 12%.

While job vacancies and unemployment rates may not indicate a larger social trend, it’s worth taking a closer look at the reasons for the current unemployment statistics. While overall unemployment numbers may not be unusual, it is also true that workers are voluntarily quitting their jobs in record numbers. Starting in the second half of 2021, Americans began voluntarily leaving their jobs by the millions every month, with 4.5 million quits in November 2021 alone. While Europe’s quit rate is nowhere near that high, it is also much higher than before the pandemic, with surveys showing 4.5% more voluntary resignations in France, a 6% increase in Germany, a 4.7% increase in the UK, etc. The resignation phenomenon is also affecting China, where tang ping is a form of social protest expressed by voluntary unemployment.  

So even if labor and employment statistics may not reflect long-term sweeping changes, there remains a sharp increase in the number of people choosing to leave their jobs in 2021. The question is why. 

Causes of the Great Resignation

In order to understand the Great Resignation, it’s worth taking a step further back and looking at the main reasons why people quit their jobs under normal circumstances. According to a study of 34 million US employee profiles, here were the highest predictors of employee turnover: 

  • Toxic corporate culture. According to this research, work culture is 10x more important than compensation in driving employees to leave a job. 
  • Job insecurity. It’s probably no surprise that, in these unstable times, job insecurity and company reorganization play a huge role in employee turnover. 
  • High innovation. Surprisingly, while many surveyed employees want to work at innovative companies, innovation is also the third highest predictor of voluntary resignation. In most cases, innovative companies are also associated with high levels of stress, instability, and poor work/life balance.
  • Lack of recognition. Recognition is often correlated with compensation, but that isn’t always the case. Critically, a company’s highest and best performing employees are more likely to quit when their contributions aren’t recognized.

Another factor to consider is that the pandemic has caused millions of people to simply pause and rethink their life goals and priorities. While the evidence is still anecdotal, this type of personal re-assessment is widespread and global, and has affected work, family, spirituality, and every other aspect of people’s lives. 

These factors may help to explain why the Great Resignation will be felt less in Europe than in the United States. Workers in Europe already enjoy better work/life balance, with shorter workweeks and more holidays; more financial stability, with less medical and education debt; and more social support programs as their personal needs change. However, while the Great Resignation will probably be less acute than in the US, employers still need to pay attention to these facts and factors as they manage ongoing labor shortages. 

For companies looking to reduce turnover and retain their best employees, paying attention to why employees quit and addressing those aspects of their work culture and reward system can go a long way toward improving retention. For more insight on how to build and keep a great team, even in turbulent times, contact grapefrute today.