If you’ve spent any amount of time browsing the internet or watching the news, the phrase “Great Resignation” isn’t foreign to you. It’s been thrown about wildly since the early days of the pandemic and it continues to pick up steam as the months go by.
The Great Resignation is exactly what it sounds like. It’s the trend of employees quitting their jobs and focusing more time on their personal life. In other words, employees are shifting from a “live to work” to a “work to live” mindset.
This doesn’t necessarily mean that people don’t want to work. It means that they’re seeking an improved work-life balance.
According to a recent CNBC article, 3.9 million people quit their jobs in June 2021. And that doesn’t take into consideration the millions of people who quit in the months leading up to June.
What’s the Reason for “The Great Resignation” Trend?
As noted above, many people are quitting their jobs in search of something that makes them happier. They don’t want to spend eight or more hours every day at a job they don’t enjoy.
Other reasons for the growth of this trend include:
- Early retirement after cashing in on the stock market and/or rising real estate values
- Starting a small business
- Seeking permanent remote work
Regardless of the reason why so many people are putting in their two-weeks notice, it’s had a profound effect on employers of all sizes in all industries. And with that, workforce planning is also changing. Here’s how.
1. Headcount Planning Is a Must
You know how many people you have in your company right now, but do you expect that number to be the same tomorrow? Next week? Next month?
The more employees you have, the greater chance there is of turnover. As employees quit, your headcount will dip. And as you hire replacements, your headcount will once again grow. At least in the meantime, you should expect an ebb and flow.
With the right approach to headcount planning, you can:
- Stay proactive against churn
- Track and manage new hires and terminations
- Track the impact of new hires and terminations on company finances
If you’re not careful, the Great Resignation could sneak up on your business—and not in a good way. You could find yourself short-staffed and falling behind.
Check out our “Ultimate Guide to Workforce Planning” to help you and your business navigate The Great Resignation.
2. Remote Employment Is on the Rise
As a result of the COVID-19 pandemic, a large number of workers throughout the United States (and the rest of the world) were forced into remote work. Some liked it, some loved it and some wanted to return to the office after one day.
There will always be people who dread working from home, but there are many more who have fallen in love with remote work.
According to a report by the U.S. Bureau of Labor Statistics, “the percent of employed persons working at home on days they worked nearly doubled” to 42% during the COVID-19 pandemic in 2020.
If you’re receptive to remote work, there’s a greater chance of keeping the majority of your workforce happy. Conversely, if you want your employees to return to the office as soon as possible, it’s likely to scare some of them into quitting. They want the freedom of working from home.
The growth in remote employment is changing workforce planning in many ways:
- Varying state and local tax laws
- Employer authorization to do business in different areas
- The implementation of remote work policies
- The need for new technology and equipment
- Timekeeping policies
Payroll alone has the potential to cause trouble as you now have to calculate taxes such as FICA, FUTA and SUTA by the location of the employee.
3. Forecasting Can Save Your Company
Forecasting has always been a big part of success in the business world. If you’re focused solely on the present, you’re more prone to getting knocked off your throne in the future.
Business forecasting could make or break your company as the Great Resignation wears on.
With Extended Planning, you can “integrate your financial, operational and other business data to uncover your hidden insights and dependencies between departments.”
When you do that, forecasting becomes less time-consuming, less stressful and more accurate.
Regardless of the business forecasting model you employ, start by answering questions such as:
- Do you have access to historical data in an easy-to-consume format?
- Has your company been affected by the Great Resignation and/or recent economic downturn? How so?
- What’s the outlook for your industry?
- How far out do you want to forecast?
- What are your plans for using the forecast?
It’s not as crazy as it sounds. Forecasting today could save your company in the short or long term. This is even more so the case with the work landscape changing by the day.
Even if you feel confident in your workforce planning strategy, there’s no way of knowing what the future holds. Who could have predicted the Great Resignation bearing down on us in 2021?
Vena’s collaborative and intuitive workforce planning software can help you tackle the here and now while also preparing for the future. It helps with everything from payroll and benefits planning to employee transfers and headcount planning.
Don’t let a trend like the Great Resignation bury your business. Adjust accordingly so it can continue to thrive.