U.S. President Joe Biden stated the obvious recently, indicating that “the power dynamic has shifted from employees competing for jobs, to employers competing for employees.” This reality comes with significant ramifications for both employers and job seekers – that is, if both parties are hoping to create the kind of work experience where fulfillment, joy, and performance are high, and win-win tenure is established.

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Warmly,

At a time when companies are trying to recover from the worst recession since the Great Depression and return to full speed:

• The current turnover rate is 57.3%, up from 44% a year ago [note: the target turnover rate most companies hope for is <10%]
• Nearly one-quarter of all workers have been with their employer for less than one year
• The quit rate (number of people quitting their jobs) has doubled in the last 12 months
• 95% of workers today are thinking about quitting their jobs, up from 40% five months ago
• Average tenure rate for Millennials (the largest workforce generation) is 2.8 years
• Average tenure rate (all generations) is 4.1 years, compared with 5.5 years in 2014

Immediate Impacts of High Turnover

At a time when revenues have been down for most companies, we are seeing:

• Explosively high turnover costs, ranging from 16% of monthly salary (hourly employees) to 213% for top executives
• The worst labor shortage of the past 50 years (due to high quit rates)
• 80% of employers unable to find skilled workers

Resignation and Retention – Causes

While there are many reasons employees leave or stay, the data reveals some critical factors that, left unaddressed, will only exacerbate the situation:

Stress:

• #1 reason people leave their jobs is high stress/burn-out
• 44% of full-time employees are burned out, and 61% say they are somewhat burned out

Growth (or the lack of it):

• 29% of employees leave for lack of growth opportunities
• 80% of employees don’t believe their company offers growth opportunities
• Half of employees believe it’s the employer’s job to grow them (rather than their own responsibility)

• 54% of employees don’t feel they have the skills needed for today

Relationships:

• 49% of high-performing employees say they stay in their jobs because of strong relationships at work

Sources

All statistics come from the past year and the most current sources:

• Human Resources Today
• MarketWatch
• BusinessInsider
• Zippia
• Ceredian
• Monster
• Glassdoor
• HRDive
• ConferenceBoard
• EBRI Trends
• U.S. Bureau of Labor Statistics

John Alldredge
Former Vice President of Strategy
United Healthcare Inc.
(A Fortune 5 Company)

Financial wizards and economists alike have been asked to give their 2 cents that would be compressed into a 30-second sound bite on the situation, but those worth their salt knew enough to try for a longer explanation. So, that’s what we’re doing for this article!

“Wave” in this context refers to virus infection rates surging after decreasing for a period of time. The Spanish Flu came in 4 waves between 1918 and 1920, infecting about half a billion worldwide. To date in the COVID-19 pandemic, 201 million cases have been reported around the globe, and the word “reported” is key. Experts say the 4th wave began in the United States about a month ago, but not every country or continent is at the same point. The 4th and final wave of the 1918-1920 pandemic gave way to a decade of economic success in this country and Europe – it was called “The Roaring 20s”. And while the US economy is currently in recovery, expectations of “The Roaring 2020s” which would emulate what happened 100 years ago should be tempered with the consideration of other factors that influenced the last century’s… period of roar, so to speak.

Sure, there are similarities between the dueling, century-apart “20s”. For example:

• A pandemic ending (or in the case of COVID-19, at least apparently quickly winding down
• New technologies and industry leading the way in expanding and supporting the economy (radio, silent movies, the auto industry, electric appliances for the home that made it possible or more convenient to manage a household; and now, Artificial Intelligence in manufacturing, more widespread use of Internet of Things, aerospace progress being picked up and revamped by the private sector, 5G, and more)
• New advances in technologies that move us great distances (like Ford Model T of the past and autonomous and smart cars of now)

The stock market also experienced great gains at the end of both pandemics. There is one difference than experts find particularly important to point out though. The Spanish Flu took off in February 1918, right in the midst of World War I. Well over 1 million American soldiers were infected and 45,000 were sick enough to have succumbed (30,000 of them before they even left our shores to enter the theater of war). Just like with COVID-19, not everyone who contracted the virus was sick enough to need hospitalization, so while the War Department conservatively estimates 26% of the Army was made seriously ill by the Spanish Flu, the total percentage of those actually infected was more likely closer to 40%. At this point, you may be wondering “what does any of this have to do with our economy now”? Read on.

World War I ended in November 1918, and after dodging new weapons of destruction and death like poison gas, artillery fire, and the happenstance-at-the-time flu pandemic, soldiers were lucky to have even survived – and they darn well knew it. They just wanted to get home and quickly make moves to get as much out of life as possible. The ending of this war, with all sorts of new technologies and advancements (brought to widespread industry stateside), and changing attitudes and realizations that it brought, definitely affected the “roaring” and economic boom of the 1920s. We must temper optimism and looking to past economic success after a pandemic with full knowledge and information about other factors that brought prosperity.

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