Workers are most likely to quit because of a lack of career development and advancement opportunities, according to recent research that also found more than half of quitting tech workers leave the industry altogether – perpetuating a “structural gap in the labour supply”.
More than 40 per cent of those who had recently quit their jobs said they left because they lacked opportunities to develop and advance their careers, according to a recent McKinsey and Co study that evaluated the impact of recent labour market disruptions on 13,382 workers worldwide.
Inadequate compensation was also a common reason (36 per cent), while 34 per cent blamed “uncaring and uninspiring leaders”, 31 per cent flagged a lack of meaningful work, and 29 per cent blamed unsustainable work expectations.
Fully 55 per cent of technology, media, and telecommunications workers said they left the industry altogether after quitting their job – diminishing the pool of available qualified talent.
Attrition was even worse in sectors such as consumer/retail jobs – where 76 per cent of ex-workers left the industry and didn’t look back – and public sector (72 per cent) and finance/insurance (65 per cent).
With 41 per cent of Australian respondents saying they were at least somewhat likely to leave their current jobs before the end of the year, the dwindling pool of experienced workers has become a defining challenge for employers.
Since winning them over requires convincing recent departees that you’re offering a better situation than the one they just left, “the Great Attrition has become the Great Renegotiation,” the report’s authors note in flagging a “fundamental mismatch between companies’ demand for talent and the number of workers willing to supply it.
“People keep quitting at record levels [but] companies are still trying to attract and retain them the same old ways,” the report notes, “by [relying on] traditional levers to attract and retain people, including compensation, titles, and advancement opportunities.”
Such incentives may be effective for ‘traditionalists’, but there aren’t enough of those conventionally-minded workers to keep up with demand.
“There is now a structural gap in the labour supply because there simply aren’t enough traditional employees to fill all the openings,” the report notes.
“Even when employers successfully woo these workers from rivals, they are just reshuffling talent and contributing to wage escalation while failing to solve the underlying structural imbalance.”
Five personas, five approaches to win them over
To fix that imbalance, employers need to develop a more nuanced understanding of the reasons workers quit, and what incentivises them to choose one employer over another.
McKinsey identified four other worker personas, each with different priorities that require a different focus during recruitment.
These include flexibility-focused ‘do-it-yourselfers’ who work non-traditional roles such as gig and part-time jobs, and “want flexibility above all else”.
“Attracting this cohort may be difficult, because organisations must show that what they offer is better than what these workers have created for themselves,” McKinsey notes.
Employers should target do-it-yourselfers with a sense of purpose, a focus on outcomes-based management, and modularised work that “decouples goal setting and the completion of tasks from the traditional five-day workweek”.
The ’caregivers’ cohort, by contrast, comprises mainly 18 to 44-year-old passive job seekers who are “hoping to find an opportunity that would justify re-entering the paid labour force” and will respond to offers like part-time options, flexible hours, expanded benefits, and expanded parental leave options.
Younger ‘idealists’ tend to be students and prioritise flexibility, career development and advancement potential, meaningful work, and a community of “reliable and supportive people”, McKinsey said, advising companies to “create a strong organisational culture that emphasises meaning and purpose”.
Reflecting the growing importance of diverse workplaces, idealists are more likely than other personas to prioritise belonging to inclusive and welcoming communities.
Borrowing from this ethos, employers should woo them with flexible work schedules to accommodate classes; invest in day-to-day interactions that build a high-quality culture; and offer development programs with “clear advancement trajectories”.
While some relaxers may be desperate for work as inflation eats into their retirement savings, those who are financially stable “will want more than the traditional value proposition to be enticed back,” the report advises while noting that “organisations have not pursued these seasoned workers as hard as they might”.
By being aware of how potential employees’ own life situations will affect their perception of a job offer, employers can improve their chances of winning workers over.
“Their differences show that employers have to take a multifaceted approach to attract and retain talent,” McKinsey advises.
“This doesn’t mean organisations have to change their mission, values, or purpose [but] they can showcase different facets of their employee value proposition to a broader number of workers, and get more creative in their offers to current and potential employees.”