With 20 million employees quitting their jobs in an eight-month period, 10.6 million job vacancies are still waiting to be filled
Perhaps one of the most stunning outcomes of the COVID shutdown is the fact that tens of millions of people decided to leave their jobs. Some attribute “The Great Resignation” as a result of people having the time to evaluate their lives and re-order their priorities. Others felt that compensation was a key driver into the unprecedented levels of resignations. However, researchers have found that people are leaving their jobs due to something entirely unexpected - company culture.
Majority of Workers Feel Undervalued At Their Company
According to a study from the consulting firm Price Waterhouse Cooper, over 64% of American workers feel undervalued at their company. Additionally, 63% of American workers feel financially unstable. When you combine the fact that the average worker feels under-appreciated and underpaid, then one may understand the need to seek a career change.
However, compensation did not turn out to be the main reason for a person to accept a new job. Another study from Workforce Report found that the new workers received a compensation increase of just 6.6% - just in line with the year-over-year inflation rate from 2021 to 2022.
Companies Finding Themselves in a Benefit Arms Race
Today companies are finding that compensation alone will not be the key driver to fill vacancies. More and more job candidates are looking for a position that will provide them with a “well-founded” package that includes the ability to work from home, sign-on bonuses, and complete healthcare coverage packages.
As an example, Amazon has created one of the most competitive compensation packages to help fill hundreds of thousands of open warehouse job positions. Some of the benefits included in the Amazon compensation package include overtime for work over 40 hours per week, complete medical, dental, vision & prescription insurance, maternity & parental leave, and holiday pay opportunities.
However, Amazon still faces an astounding 150% turnover rate. Even with one of the most competitive compensation packages for unskilled workers, 33% of new Amazon hires are quitting within the first 90 days of employment.
Adjusting to the Employee Focused Market
Now that the tables have turned and employees are able to be more selective, companies need to join the “benefits arms race” in order to fill their vacancies with the right job candidates.
Beyond benefits, future employees are looking for benefits that will improve their lives both at work and at home. These benefits include the ability to prioritize personal savings, a reassuring life routine, a sense of safety outside the job, and a feeling of being valued at the company.
Employers who want to remain competitive in finding top job candidates need to put themselves in the hands of top job candidates. By understanding what will make employees feel comfortable and valued, they will be able to hire the best and the brightest.