Why your people are quitting, by the numbers

Why are your people quitting? [30 questions]

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The initial wave of resignations post-pandemic might have declined, but we’re not out of the woods. Far from it.

For example, IDC found that even a year on from the Great Resignation, 32% of European employees are actively looking for a new job. And Korn Ferry predict that by 2030 there will be a global talent shortage of more than 85 million people, causing $8.5 trillion in unrealized annual revenue.

It’s a perfect storm: employees are leaving the workforce in huge numbers, and hiring replacements is getting harder and more expensive. In this context, reducing turnover is a massive competitive advantage.

To do that, you need to understand the complex causes of turnover. You can then take the right actions to retain your best people and keep them engaged and productive for longer.

Did you know that Winningtemp customers on average enjoy 30% decreased turnover after one year? 👀

It’s no substitute for knowing exactly what’s influencing your people, in your unique workplace. But keep reading to learn which three factors we see most commonly causing turnover for organisations right now. There’s a quick quiz under each, so you can self-assess whether you might be suffering from the same.  

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1 – Flexible working

The movement towards flexible working had been on the agenda for a while but the pandemic poured petrol on the fire.

Now, 37% of European workers say they’d decline a job unless flexible working was offered. And 69% said they’d take a pay cut to have flexible hours. In the US, recent data shows 72% of workers prefer a flexible work model over returning to office full-time.

Employers are racing to meet these needs, to develop a workplace that works for everyone. McKinsey report that 58% of workers in the US – equivalent to 92 million people – have the option to work from home at least sometimes, for instance.

On the whole, this is good news. But there’s no perfect roadmap and organisations often face unexpected challenges.

Getting flexible working right can be like walking a tightrope. Employees’ scores for autonomy and job satisfaction often increase when they’re free to work flexibly, for example, but team spirit and participation might suffer. (Discover the nine major factors contributing to employee engagement).

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Could your approach to flexible working be causing turnover?  

If you answer ‘no’ or ‘not sure’ to 5 or more of the questions below, this could be an important area to explore.

1. Do you have a formal flexible working policy?

2. Is everyone familiar with your policy?

3. What do your people like and dislike about your policy?

4. Do your people know who to approach with flexible working concerns?

5. What challenges do your people face with flexible working?

6. Have you formally trained managers to manage remote or hybrid teams?

7. Are your social and networking opportunities inclusive for remote workers?

8. How does your onboarding accommodate hybrid or remote workers?

9. What challenges do remote workers versus office-based workers face?

10. Is hybrid working causing any tension within your culture?

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2 – Financial wellbeing  

Recession in Europe is getting increasingly probable, as inflation spirals and energy costs run out of control. The US might not be far off. In a slightly tongue-in-cheek move, the World Economic Forum warns that European’s essential morning coffee might soon become a luxury, even.

Official recession or not, this financial insecurity is hitting employees hard. For example, PwC’s Employee Financial Wellness Survey 2022 reports that 56% of employees are stressed about their finances. Over a third (34%) say financial stress is hurting their mental health, while 18% and 15% say money worries impact their productivity and attendance respectively.

Not good. Poor financial wellbeing is a major contributor to poor engagement – and ultimately, a major cause of turnover. PwC report that 65% of employees looking for a new job cite money as their primary reason.

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Could poor financial wellbeing be causing turnover?  

If you answer ‘no’ or ‘not sure’ to 5 or more of the questions below, this could be an important area to explore.

11. Are your people worried about money?

12. What are your people’s financial challenges?

13. Do your people have access to financial education and support?

14. Do your people feel well-compensated?

15. Do your people feel they can raise their financial concerns?

16. Is there pay equity between new hires and established hires?

17. Is there gender pay equity? (A new study shows probably not…)

18. Does your organisation have a recession/inflation strategy?

19. How do your people feel about your recession/inflation strategy?  

20. Do your people feel you have handled any layoffs as well as possible?  

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3 – Diversity and inclusion

DE&I advocate is one of the three most-hired roles in HR right now, showing that HR leaders do appreciate the importance of getting diversity and inclusion right.

But there’s still a long way to go. McKinsey’s landmark 2020 Diversity Wins study shows how the majority of organisations have “stalled or gone backwards” since before the pandemic.

The truth is, the pandemic exacerbated inequalities and most employers haven’t done enough to counter this. That was true during the pandemic and it’s still true now. Especially given the prevalence of Long COVID and its potential impact on health, wellbeing, engagement, absenteeism, and productivity.

Your stance — and more important, your actions – to further diversity and inclusion goals are a major driver of turnover. As much, if not more, than they ever were.

For example, PwC’s 2022 Global Workforce Hopes and Fears Survey found that employees feeling they can truly be themselves is extremely important when choosing a new role for 66% of employees. This was a major factor driving turnover: employees who do look for a new job over the next 12 months are 11% less likely to feel they can be themselves at work.

To guard against turnover, a big question HR leaders should be asking is this: does your organisation truly accommodate and celebrate difference?

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Could growing D&I concerns be causing turnover?  

If you answer ‘no’ or ‘not sure’ to 5 or more of the questions below, this could be an important area to explore.

21. Do you provide support for employees with long COVID?

22. Do employees feel safe at work, including those with clinical vulnerability?

23. How are different employees vulnerable in different ways?

24. How do you accommodate vulnerable employees at work and socially?

25. What challenges do different employee groups face?

26. Do you support different employee groups with the challenges they face?

27. Do your people trust they can raise concerns and be heard?  

28. Do your people trust you’re protecting their wellbeing?

29. Do all employees have equal career opportunities?

30. Do employees feel represented at senior leadership level?

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The right insights drive the right actions

Those are three of the factors we’re seeing drive turnover most commonly right now, so hopefully this quiz has been a helpful thought starter. But this comes with a major qualification:

A million factors can drive turnover, and your own situation can be vastly different from another organisation.

The right workforce strategies hinge on the right workforce data.

How do you know whether you should you pre-empt poor financial wellbeing by increasing salaries, for example?

That’s a big decision because an inflation-beating pay rise will send your compensation budget spiralling, and potentially increase the likelihood of layoffs later down the line. And what if your people actually do feel well-compensated? What if instead of increasing salaries, they’d feel much more engaged if you boosted your healthcare offering or parental leave?

"Ultimately there’s no substitute for knowing exactly which challenges your own people face, in your own organisation and culture, right now. Unless you ask. Real-time insights and feedback from your employees really empower meaningful change. Here’s 8 tips of how to build a culture of feedback in 2023."

Winningtemp’s employee engagement platform could really help. Our platform gives you real-time scores for the temperature of your workforce, so you can spot issues as they emerge (and before they turn into turnover…). And more than that, Winningtemp provides automated, science-backed, field-tested guidance to address issues.

Winningtemp customers have enjoyed huge success reducing turnover because our platform makes it easy to act on the stuff that’s driving your people away and create experiences employees love.

Watch this two-minute demo video to learn more.‍‍‍