After nearly two years of widespread job switching, turnover has eased and the great resignation is drawing to a close, giving way for a new era called the “big stay.”
The rate of people quitting their jobs fell to 2.4% in April, about in line with the average in 2019 — just before the pandemic hit, according to recent data from the U.S. Bureau of Labor Statistics. Quits peaked at 3% in November 2021 and April of 2022.
Widespread workforce shortages that led to ample job openings and wage growth spurring more job-hopping have subsided over the past year, according to Nela Richardson, chief economist at employee research institute ADP.
In May pay growth for those switching jobs fell a percentage point for the second month in a row, according to research from ADP.
Accordingly, workers are now settling into new roles and more plan to stay put.
The share of new hires planning to stay in their current job for five years or more has risen over the last three quarters, and now stands at about 33%, according to a survey out Tuesday from Ziprecruiter.
“Their own industries may have been temporarily disrupted and now they’re increasingly taking jobs that they think will be their careers for the long term,” Julia Pollak, chief economist at Ziprecruiter, said.
Experts say employers can breathe a sigh of relief, but should consider the lessons learned from the great resignation as they settle into this new period.
Better recruiting and hiring etiquette
People who are still job swapping are finding new jobs quicker than before, in large part due to revised company policies around hiring practices, Pollak said. “Companies have pretty dramatically improved their recruiting processes in recent months,” she said.
The share of recruiters responding to candidates within one to three days has gone up from around 50% to more than 60% over the past six months, according to Ziprecuriter’s survey.
Employers used to be fine getting back to candidates within about a week, though some now have rules requiring recruiters to respond to every candidate within 48 hours, or in some cases by the end of each workday, she said.
“Companies are increasingly focusing on speed and responsiveness, and that it was a change sort of forced by the great resignation and the labor shortages they experienced in the fierce competition for talent,” she said.
“It also may be a change that kind of outlasts that moment, and that makes for a better job search experience going forward.”
Heightened focus on internal talent mobility
Labor shortages led companies to rethink not only who they bring in, but also who they promote, and how they can upskill current employees.
“If we need a new bunch of people to do something new, hiring them from the outside may not be the right answer, and maybe we should develop them internally,” said Josh Bersin, an analyst and CEO of The Josh Bersin Company, a research and advisory firm focused on corporate learning, talent management and HR.
While this isn’t a new idea, it’s becoming a more common business practice, he said, especially as demand grows for workers with skills on new technology like artificial intelligence tools.
“That’s a lot cheaper than going out and hiring new people, so that is a big lesson that’s been learned from the pandemic,” Bersin said.
At the same time, when employees are provided career development opportunities, they feel more commitment to their organizations and are less likely to quit, he said.
Taking retention more seriously
When employers truly struggled finding needed talent early into the great resignation, they first threw money at recruitment, “and later they realized, wait a second, our real problem is retention,” Pollak said.
To better retain current and new employees, some have invested in better management, enhanced office spaces and pulled other levers to improve working conditions over the past few years.
“Companies in a tight labor market made some real changes to the way they do business,” Pollak said. “They do not want to go back to the turnover rates that they saw during the pandemic,” she said.
Avoiding the vicious cycle of burnout and turnover
Workers reported increased stress and burnout that impacted their professional performance and relationship to their roles throughout the pandemic. While those challenges haven’t completely eased, many job switchers are happier and more satisfied in new positions.
Job satisfaction rose in 2021 and 2022 when the great resignation was in full swing — according to a report from the Conference Board — and last year hit the highest level since the organization began conducting its survey nearly three decades ago.
“A lot of people were kind of miserable in their jobs, they were burned out, it was too much, and that was a major reason for the great resignation and for people quitting,” Pollak said.
“Now, with more companies fully staffed again, each individual worker has a more manageable and sustainable load, and they’re more satisfied with their jobs and less eager to leave,” she said.
Remote work and the great resignation also forced employers to focus more closely on engagement among employees, which will likely continue.
“Some of the fundamentals around engagement will continue to be important to employers going forward, if [companies] want to differentiate themselves and create a good employment brand,” Jim Harter, chief scientist of workplace and wellbeing at Gallup, said.