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How employers can move from the great resignation to the great retention

Future of Work|Talent|Total Rewards|Wellbeing
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By Stephen Young and Andy Walker | October 26, 2021

Employers that focus on EX innovation as a strategic pillar are best positioned to meet the needs of their employees in a post-pandemic working world.

COVID-19 has influenced many business trends, but perhaps the most unsettling one for employers is that of the Great Resignation: a significant number of employees voluntarily leaving their jobs as the pandemic continues. While many of these employees are leaving for better opportunities, the environment in which the Great Resignation surfaced reflects a turbulent reality for employers, one that is not likely to show signs of stabilizing until 2022 and possibly beyond.

As reported in our 2021 Talent Attraction and Retention Survey, the pandemic has affected employee attitudes toward work in some key ways:

  • Employees — particularly in such industries as manufacturing, hospitality and retail — are choosing not to return to work as businesses reopen, whether out of health-related fears and concerns or to postpone a return while they collect unemployment.
  • People with certain job differentiators, such as digital skills, are resigning because they know that they have a rare commodity that can command a higher price at other companies.

Some unprecedented social implications have also been driving employees to rethink their jobs and careers:

  • Employees in lockdown or working at home have had a lot of time for self-reflection and are realizing they want something more out of their lives — and their work. As a result, employees are looking for a greater sense of purpose in their work.
  • Employees are suffering from a series of “human stressors,” including social and financial, not to mention the toll of sickness on themselves or loved ones.

As a result, 58% of employees are experiencing moderate to high levels of anxiety, according to Willis Towers Watson’s report, The Employee Experience Stress Test. For many employees who were considering leaving their jobs prior to the pandemic, these stressors are helping to push them out the door.

What do employees want?

Our research identified the following primary drivers of employee retention exhibited by high-performing companies:

  1. Support for employees to achieve their career objectives, develop and grow
  2. A fair relationship between pay and performance (rewarding employees fairly for work done)
  3. Opportunities for employees to learn new skills, with performance evaluated fairly
  4. Support for workplace diversity and equal opportunity for all employees
  5. Communicative and open leadership (encouraging employees to give their best)

While they may be well intentioned, employers are falling short on delivering a positive employee experience (EX) largely because they don’t have the institutional muscle necessary to implement these changes quickly enough.

Only 7% of companies were identified as having a “Transformative EX strategy” in Willis Towers Watson’s 2021 Employee Experience Survey. These employers have an EX strategy that is integrated with their business strategy and are using technology to transform the EX fundamentally. As a result, they are seeing better outcomes in such areas as engagement, wellbeing, culture and business results.

What are companies doing to improve the EX?

Organizations are now acknowledging and trying to address these new realities, both to keep the employees they have and to attract ones who are seeking something more from their current employer. Ninety-two percent of employers say enhancing the EX will be a priority over the next three years, compared with 52% prior to the pandemic.

Based on the actions of high-performing organizations that deliver a transformative EX, employers that wish to stave off the Great Resignation in favor of retaining employees should put renewed emphasis on three strategies:

Flexibility

Employees are seeking greater levels of flexibility at work, and they want that flexibility to be permanent. If their organization is not committing to flexible work options, employees are seeking out other options.

In three years, employers expect one in four employees to be working a mix of onsite and remotely. This is in addition to the 19% who will primarily be working remotely.

Total Rewards

Companies that might not normally be competing with each other for talent due to geography are now drawing from the same talent pool because they don't need people to relocate. A wider net of applicants means more competition, and organizations that provide differentiated Total Rewards will be more attractive to the best talent.

Recognizing high levels of competition in the marketplace, 72% of organizations are undergoing a redesign and transformation of their Total Rewards, compared with pre-pandemic levels of about 27%, according to the Flexible Work and Rewards Survey: 2021 Design and Budget Priorities.

Trust and compassion

Employers that show up in a more human way, reflecting a level of trust and compassion that shows they understand the new reality for their employees, will be best positioned to sustain their workforces. To meet employees’ need for purpose at work, employers are paying more attention to equal opportunities for all employees, inclusion and diversity, and employee wellbeing.

Transformative EX organizations are 32 percentage points more effective at setting and communicating strategies as well as managing change, compared with all other companies.

Taken together, these strategies serve as a blueprint to any organization, offering practical levers that can be adjusted to help them attract and keep talent.

The Great Resignation is still in full swing, but the good news is, we’ve learned what employers can do to turn this trend into the Great Retention for their businesses. Employees are looking for something different going forward — a new experience of and at work.

Employers that focus on EX innovation as a strategic pillar encompassing workplace flexibility, take a new look at Total Rewards and lead with compassion — especially pertaining to inclusion and diversity as well as employee wellbeing — are best positioned to meet the needs of their employees in a post-pandemic working world.

Authors

Global Practice Leader
Employee Insights

Managing Director, Head of Talent, North America, East Region

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