How the ‘Great Resignation’ could affect your business

The Great Resignation

In the wake of three years of COVID-19 economic and personal disruption, a growing number of countries are experiencing unrest in their workforce, with mass resignations resulting in further hardship for businesses. We look at the effect the great resignation could have on New Zealand and what businesses can do to reduce or mitigate its effects. 

What is the ‘Great Resignation’?

The ‘Great Resignation’ refers to an economic phenomenon where far greater than the normal number of people would leave their jobs. The term was originally coined by Anthony Klotz, a professor at Texas A&M University.

Factors thought to contribute to the great resignation include people previously holding off on resigning, burnout, reassessment of priorities and unwillingness to return to normal work practices. 

In August 2021 a record 4.3 million Americans left their jobs, the highest number of resignations in a month ever. In the same month, the UK reported one million job vacancies – a record high in a one-month period. 

This is now a worldwide trend with numerous countries reporting high rates of resignations.

A recent Microsoft study reported 41 per cent of the global workforce would consider resigning within the next year

Will the Great Resignation come to New Zealand?

It would appear that the big resignation is on its way to New Zealand if not here already. 

The AUT nationwide Wellbeing@Work survey shows it has already arrived, with close to half the workforce seriously considering changing jobs, with up to one in three from 2019. HR software provider ELMO backed this up with their Employee Sentiment Index showing 43% of New Zealand workers plan to actively look for a new job in 2022.

New Zealand also faces critical labour shortages, with skills shortages pre-dating COVID and border closures. Unemployment is at an all-time low, job ads are up 45% on last year (up 33% in 2019) but job applications per job are down 45% on last year. 

All in all, there are more jobs, fewer candidates and a large chunk of the workforce looking to quit their current position. 

How will the Great Resignation affect businesses?

Put simply, it positions employers in a vulnerable position. As the effects of Omicron are sweeping through New Zealand, employers are experiencing losing a large portion of their staff to isolation. Imagine this is permanent, with just under half of your entire workforce never returning, just as you thought the end was in sight for the effects of COVID on business. 

Add to this, when you advertise to replace staff there are fewer applicants than you have ever experienced, most without the skills you need to keep your business running. 

What can businesses do to reduce these effects?

Retention of staff has to be a priority for all business leaders. Aside from the disruption and loss of knowledge that losing staff causes, it puts more pressure on those who stay and may end up driving them out of the business too. 

Some strategies for retention include increasing pay and/or benefits (such as private health care), offering fast-tracked career progression, more work-life balance, flexible working arrangements, and opportunities to work from home. Not every business is in a position to make jobs financially more attractive as more than two years of a global pandemic has left many businesses struggling to survive. 

There is another option to consider and that is to recruit a more flexible, global workforce. If you are fortunate enough to be in an industry like technology, where a job can be done from anywhere, you have access to a pool of candidates with the skills, qualifications and work ethic to keep your business operational and profitable. 

Securing global skilled talent this way also protects your team and mitigates the risk of key team members being poached in the current New Zealand market as they are not accessible to your competitors.

We are specialists in IT Recruitment, including offshore IT recruitment.

With our dedicated team of IT specialists across the globe, we can provide the perfect fit for your company. Whether it’s a single, highly-skilled worker on a permanent basis, or an entire team to employ temporarily, we have hardworking, trustworthy people at hand to start work for you now.

We source quality candidates so you don’t have to, we have a dedicated, New Zealand-based team to help them settle into your business and ongoing support to ensure they thrive.

Contact us now to discuss all your recruitment needs. 

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