Australians are fed up with their jobs and looking elsewhere as the disruption of the pandemic forces workers to re-evaluate their careers.
Dubbed ‘The Great Resignation’, the trends has been characterised by an enormous spike in the number of staff leaving their jobs in the face of the pandemic.
In the United States, the resignation rate is at a two-decade high, as four million workers hand in their notice every month.
New data from HR platform Employment Hero suggests a similar phenomenon is unfolding in Australia.
Surveying local workers, 40 per cent said they were going to look for a new job within the next six months, while 15 per cent were already actively looking to split from their current employer.
More than six in 10 prospective jobseekers said they were primarily motivated to leave by a lack of career opportunities or no payrise.
A lack of recognition from their bosses and poor company culture were also identified as contributing factors.
But it’s clear that for many, money remains the number one driver.
Almost half said they would stay in their current position if they were offered an elusive pay rise, while just one quarter would be swayed by a promotion.
“Handing out pay rises is not always feasible for businesses against the backdrop of the pandemic, but if businesses can afford to give their workers a salary increase, now is the time for them to take action,” Employment Hero chief people officer Alex Hattingh said.
“The cost of turnover is high for businesses. It is better for them to shuffle funds now to stay in line with industry standards than to cop the costs later. This is especially true for the 30% of workers whose pay has not been reinstated after receiving a pandemic pay-cut.”
Cheaper, albeit less effective, options like handing out rewards and providing training to staff would help retain around one in five workers respectively.
Show me the money
After years of stagnant wages, the pandemic has presented workers with serious negotiating power.
While border closures have gifted some tech workers six-figure raises, a major shift in the labour market dynamic has increased the pressure on employers to retain their existing workforce.
One in three workers expect they’ll bank a 10 per cent raise if they change jobs, while around one in four are demanding a 20 per cent jump.
Mid-career workers aged 35-44 were the most expectant, disproportionately anticipating a 30 per cent raise.
The dynamic will place greater pressure on the bottom line of businesses, but it may also help to deliver the Reserve Bank of Australia (RBA) the elusive wage growth it says is key to driving the economic recovery.
Treasury figures have previously shown that for every extra 1 per cent of the workforce that switches jobs, wages rise by 0.5 per cent.
Accordingly, if Australia was to return to job switching levels seen in the early 2000s, as is now the case in the US, this one factor alone would theoretically raise wages by 3 per cent on pre-pandemic levels.
The Great Resignation
As more Australians throw in their jobs, their reasons are many.
While better opportunities are clearly luring them elsewhere, there’s also a sense of job fatigue. A survey of 25 countries found Australian workers to be the most burnt out in the world, with around one in two employees having had to take mental health leave.
With as many as one in four Americans having changed jobs since the beginning of last year, the writing is on the wall for those that don’t cater to their workforce.
Evidently, it isn’t all about money, – 41 per cent of workers say their job satisfaction is the single most important factor in making a career decision. Around one in four say flexible work arrangements are their priority.
“For businesses, there’s no point focusing on recruitment if they’re not also considering retention, or vice versa,” Employment Hero CEO Ben Thompson said.
“The better a business’ retention strategy, the stronger their [value proposition] will be, the easier it will be to sell the business to great talent.
“Pushing for growth while experiencing high turnover can be disastrous. As retention drops, the pressure intensifies, triggering more turnover. It can be a vicious cycle, and it can cost a business thousands.”
From offering remote work options to implementing career development plans, Thompson said the only way to compete is to successfully retain and recruit.
Ultimately, it comes back to refocusing away from the business itself and onto the people who drive it.
This article was originally published by Business Insider Australia.