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Majority of workers who quit a job in 2021 cite low pay, no opportunities for advancement, feeling disrespected.

The COVID-19 pandemic set off nearly unprecedented churn in the U.S. labor market. Widespread job losses in the early months of the pandemic gave way to tight labor markets in 2021, driven in part by what’s come to be known as the Great Resignation . The nation’s “quit rate” reached a 20-year high last November.

A bar chart showing the top reasons why U.S. workers left a job in 2021: Low pay, no advancement opportunities

A new Pew Research Center survey finds that low pay, a lack of opportunities for advancement and feeling disrespected at work are the top reasons why Americans quit their jobs last year. The survey also finds that those who quit and are now employed elsewhere are more likely than not to say their current job has better pay, more opportunities for advancement and more work-life balance and flexibility.

Majorities of workers who quit a job in 2021 say low pay (63%), no opportunities for advancement (63%) and feeling disrespected at work (57%) were reasons why they quit, according to the Feb. 7-13 survey. At least a third say each of these were major reasons why they left.

Roughly half say child care issues were a reason they quit a job (48% among those with a child younger than 18 in the household). A similar share point to a lack of flexibility to choose when they put in their hours (45%) or not having good benefits such as health insurance and paid time off (43%). Roughly a quarter say each of these was a major reason.

Pew Research Center conducted this analysis to better understand the experiences of Americans who quit a job in 2021. This analysis is based on 6,627 non-retired U.S. adults, including 965 who say they left a job by choice last year. The data was collected as a part of a larger survey conducted Feb. 7-13, 2022. Everyone who took part is a member of the Center’s American Trends Panel (ATP), an online survey panel that is recruited through national, random sampling of residential addresses. This way, nearly all U.S. adults have a chance of selection. The survey is weighted to be representative of the U.S. adult population by gender, race, ethnicity, partisan affiliation, education and other categories. Read more about the ATP’s methodology .

Here are the questions used for this analysis, along with responses, and its methodology.

About four-in-ten adults who quit a job last year (39%) say a reason was that they were working too many hours, while three-in-ten cite working too few hours. About a third (35%) cite wanting to relocate to a different area, while relatively few (18%) cite their employer requiring a COVID-19 vaccine as a reason.

When asked separately whether their reasons for quitting a job were related to the coronavirus outbreak, 31% say they were. Those without a four-year college degree (34%) are more likely than those with a bachelor’s degree or more education (21%) to say the pandemic played a role in their decision.

For the most part, men and women offer similar reasons for having quit a job in the past year. But there are significant differences by educational attainment.

A chart showing that the reasons for quitting a job in 2021 vary by education

Among adults who quit a job in 2021, those without a four-year college degree are more likely than those with at least a bachelor’s degree to point to several reasons. These include not having enough flexibility to decide when they put in their hours (49% of non-college graduates vs. 34% of college graduates), having to work too few hours (35% vs. 17%) and their employer requiring a COVID-19 vaccine (21% vs. 8%).

There are also notable differences by race and ethnicity. Non-White adults who quit a job last year are more likely than their White counterparts to say the reasons include not having enough flexibility (52% vs. 38%), wanting to relocate to a different area (41% vs. 30%), working too few hours (37% vs. 24%) or their employer requiring that they have a COVID-19 vaccine (27% vs. 10%). The non-White category includes those who identify as Black, Asian, Hispanic, some other race or multiple races. These groups could not be analyzed separately due to sample size limitations.

Many of those who switched jobs see improvements

A majority of those who quit a job in 2021 and are not retired say they are now employed, either full-time (55%) or part-time (23%). Of those, 61% say it was at least somewhat easy for them to find their current job, with 33% saying it was very easy. One-in-five say it was very or somewhat difficult, and 19% say it was neither easy nor difficult.

For the most part, workers who quit a job last year and are now employed somewhere else see their current work situation as an improvement over their most recent job. At least half of these workers say that compared with their last job, they are now earning more money (56%), have more opportunities for advancement (53%), have an easier time balancing work and family responsibilities (53%) and have more flexibility to choose when they put in their work hours (50%).

Still, sizable shares say things are either worse or unchanged in these areas compared with their last job. Fewer than half of workers who quit a job last year (42%) say they now have better benefits, such as health insurance and paid time off, while a similar share (36%) says it’s about the same. About one-in-five (22%) now say their current benefits are worse than at their last job.

A bar chart showing that college graduates who quit a job are more likely than those with less education to say they’re now earning more, have more opportunities for advancement

College graduates are more likely than those with less education to say that compared with their last job, they are now earning more (66% vs. 51%) and have more opportunities for advancement (63% vs. 49%). In turn, those with less education are more likely than college graduates to say they are earning less in their current job (27% vs. 16%) and that they have fewer opportunities for advancement (18% vs. 9%).

Employed men and women who quit a job in 2021 offer similar assessments of how their current job compares with their last one. One notable exception is when it comes to balancing work and family responsibilities: Six-in-ten men say their current job makes it easier for them to balance work and family – higher than the share of women who say the same (48%).

Some 53% of employed adults who quit a job in 2021 say they have changed their field of work or occupation at some point in the past year. Workers younger than age 30 and those without a postgraduate degree are especially likely to say they have made this type of change.

Younger adults and those with lower incomes were more likely to quit a job in 2021

A bar chart showing that about a quarter of adults with lower incomes say they quit a job in 2021

Overall, about one-in-five non-retired U.S. adults (19%) – including similar shares of men (18%) and women (20%) – say they quit a job at some point in 2021, meaning they left by choice and not because they were fired, laid off or because a temporary job had ended.

Adults younger than 30 are far more likely than older adults to have voluntarily left their job last year: 37% of young adults say they did this, compared with 17% of those ages 30 to 49, 9% of those ages 50 to 64 and 5% of those ages 65 and older.

Experiences also vary by income, education, race and ethnicity. About a quarter of adults with lower incomes (24%) say they quit a job in 2021, compared with 18% of middle-income adults and 11% of those with upper incomes.

Across educational attainment, those with a postgraduate degree are the least likely to say they quit a job at some point in 2021: 13% say this, compared with 17% of those with a bachelor’s degree, 20% of those with some college and 22% of those with a high school diploma or less education.

About a quarter of non-retired Hispanic and Asian adults (24% each) report quitting a job last year; 18% of Black adults and 17% of White adults say the same.

Note: Here are the questions used for this analysis, along with responses, and its methodology.

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Two Years Into the Pandemic, Americans Inch Closer to a New Normal

Covid-19 pandemic continues to reshape work in america, the self-employed are back at work in pre-covid-19 numbers, but their businesses have smaller payrolls, despite the pandemic, wage growth held firm for most u.s. workers, with little effect on inequality, covid-19 pandemic saw an increase in the share of u.s. mothers who would prefer not to work for pay, most popular.

About Pew Research Center Pew Research Center is a nonpartisan fact tank that informs the public about the issues, attitudes and trends shaping the world. It conducts public opinion polling, demographic research, media content analysis and other empirical social science research. Pew Research Center does not take policy positions. It is a subsidiary of The Pew Charitable Trusts .

‘Great Attrition’ or ‘Great Attraction’? The choice is yours

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More than 19 million US workers— and counting—have quit their jobs since April 2021, a record pace disrupting businesses everywhere. Companies are struggling to address the problem, and many will continue to struggle for one simple reason: they don’t really understand why their employees are leaving in the first place. Rather than take the time to investigate the true causes of attrition, many companies are jumping to well-intentioned quick fixes that fall flat: for example, they’re bumping up pay or financial perks, like offering “thank you” bonuses without making any effort to strengthen the relational ties people have with their colleagues and their employers. The result? Rather than sensing appreciation, employees sense a transaction. This transactional relationship reminds them that their real needs aren’t being met.

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If the past 18 months have taught us anything, it’s that employees crave investment in the human aspects of work. Employees are tired, and many are grieving . They want a renewed and revised sense of purpose in their work. They want social and interpersonal connections with their colleagues and managers. They want to feel a sense of shared identity. Yes, they want pay, benefits, and perks, but more than that they want to feel valued by their organizations and managers. They want meaningful—though not necessarily in-person— interactions , not just transactions.

By not understanding what their employees are running from, and what they might gravitate to, company leaders are putting their very businesses at risk. Moreover, because many employers are handling the situation similarly—failing to invest in a more fulfilling employee experience and failing to meet new demands for autonomy and flexibility at work—some employees are deliberately choosing to withdraw entirely from traditional forms of full-time employment.

About the research

To better understand what’s driving voluntary attrition in the labor market, we conducted separate surveys of employers and of employees in Australia, Canada, Singapore, the United Kingdom, and the United States. Both surveys spanned multiple industries. The employee survey included 5,774 people of working age; the employer survey, 250 managers specializing in talent (for instance, chief talent officers). These managers were evenly split between large organizations (with more than $1 billion in revenues) and midsize ones (with revenues from $50 million to $1 billion).

In this article, we highlight new McKinsey research into the nature and characteristics of the Great Attrition—or what many are calling the Great Resignation—and what’s driving it (see sidebar, “About the research”). The bottom line: the Great Attrition is happening, it’s widespread and likely to persist—if not accelerate—and many companies don’t understand what’s really going on, despite their best efforts. These companies are making ineffective moves based on faulty assumptions.

It doesn’t have to be this way. If companies make a concerted effort to better understand why employees are leaving and take meaningful action to retain them , the Great Attrition could become the Great Attraction. By seizing this unique moment, companies could gain an edge in the race to attract, develop, and retain the talent they need to create a thriving postpandemic organization .

But this won’t be easy, because it requires companies and their leaders to truly understand their employees. It requires leaders to develop a much deeper empathy for what employees are going through and to pair that empathy with the compassion—and determination—to act and change. Only then can employers properly reexamine the wants and needs of their employees—together with those employees—and begin to provide the flexibility, connectivity, and sense of unity and purpose that people crave.

Along the way, many senior executives will be challenged to reimagine how they lead. The skills that made leaders effective before the COVID-19 pandemic—strong coaching, mentoring, creating strong teams—are just table stakes for the challenge of the months and years ahead.

By not understanding what their employees are running from, and what they might gravitate to, company leaders are putting their very businesses at risk.

The Great Attrition is happening—and will probably continue

Executives who think that employee attrition is easing—or is limited to particular industries—are misguided. Forty percent of the employees in our survey said they are at least somewhat likely to quit in the next three to six months. Eighteen percent of the respondents said their intentions range from likely to almost certain. These findings held across all five countries we surveyed (Australia, Canada, Singapore, the United Kingdom, and the United States) and were broadly consistent across industries (Exhibit 1). Businesses in the leisure and hospitality industry are the most at risk for losing employees, but many healthcare and white-collar workers say they also plan to quit. Even among educators—the employees least likely to say they may quit—almost one-third reported that they are at least somewhat likely to do so.

Furthermore, these trends may persist. Fifty-three percent of the employers said that they are experiencing greater voluntary turnover than they had in previous years, and 64 percent expect the problem to continue—or worsen—over the next six months (Exhibit 2).

Attrition could get worse, since employees are willing to quit without a job lined up

Among the employees in our survey, 36 percent who had quit in the past six months did so without having a new job in hand (Exhibit 3). This is yet another way the Great Attrition (or what many call the Great Resignation) differs fundamentally from previous downturn-and-recovery cycles—and another sign that employers may be out of touch with just how hard the past 18 months have been for their workers.

Employees in the United States were the most likely to say they had left their old jobs without a new one (40 percent). At the industry level, 42 percent of healthcare and social-assistance workers who quit did so without having a new job—a reminder of the pandemic’s toll on frontline workers. One-quarter of white-collar employees who quit said they had done so without having a job lined up, a finding that held across income levels.

This trend not only is poised to continue but could get much worse. Among employees who said they are at least somewhat likely to leave their jobs in the next three to six months, almost two-thirds added that they would do so without lining up new jobs.

Otherwise satisfied employees may also be tempted to quit as their options expand

CEOs may be tempted to take solace in the fact that 60 percent of the employees in our survey said they were not at all likely to quit in the next three to six months. But employers shouldn’t consider this 60 percent “safe” from the prospect of attrition either. Options are increasing, and with more and more employers offering remote-work choices for hard-to-source talent, these employees could change their intentions.

Consider a few significant findings. Among employees who said they were not at all likely to quit, 65 percent reported that a primary reason to stay in their job was that they liked where they lived. But among survey respondents who took new jobs in new cities during the past six months, almost 90 percent didn’t have to relocate (Exhibit 4), because so many more companies are allowing remote work. Having more “location agnostic” positions to choose from could prompt otherwise satisfied employees to start second-guessing their commitment to the companies where they now work, particularly if executives mishandle the transition to a hybrid-work environment —or stubbornly fail to offer one at all.

Employers can’t fix what they don’t understand

To stem the tide of the Great Attrition (or what many call the Great Resignation), senior executives must understand why employees are leaving. Many are struggling to do so. For example, when employers were asked why their people had quit, they cited compensation, work–life balance, and poor physical and emotional health. These issues did matter to employees—just not as much as employers thought they did. By contrast, the top three factors employees cited as reasons for quitting were that they didn’t feel valued by their organizations (54 percent) or their managers (52 percent) or because they didn’t feel a sense of belonging at work (51 percent). Notably, employees who classified themselves as non-White or multiracial were more likely than their White counterparts to say they had left because they didn’t feel they belonged at their companies—a worrying reminder of the inequities facing Black employees and other minority groups.

Exhibit 5 shows where the disconnect between employers and employees was most acute. It highlights how employees were far more likely to prioritize relational factors, whereas employers were more likely to focus on transactional ones.

Employees were far more likely to prioritize relational factors, whereas employers were more likely to focus on transactional ones.

Start turning attrition into attraction

Our research underscores the many ways the pandemic has irrevocably changed what people expect from work. The landscape will continue to change as companies try out new hybrid-work approaches. If you’re a CEO or a member of a top team, your best move now is to hit “pause” and take the time to think through your next moves. A heavy-handed back-to-the-office policy or other mandates delivered from on high—no matter how well intentioned—are likely to backfire.

But don’t think through your next moves in a vacuum; include your employees in the process. Look to them to help shape the plan and solutions. Our research suggests that executives aren’t listening to their people nearly enough. Don’t be one of these executives.

As you take stock, ask the following questions:

Do we shelter toxic leaders? Executives who don’t make their people feel valued can drive them from companies, with or without a new job in hand. If you don’t have leaders who motivate and inspire their teams and lead with compassion, you need them—desperately.

Do we have the right people in the right places (especially managers)? Many employers in our survey reported having the right people but not necessarily in the right places. When it comes to managers, this problem can be particularly damaging, especially in hybrid environments, where new leadership skills are required. Training and capability building will be crucial for managers and executives who didn’t come from hybrid or virtual environments—in other words, for everyone from the C-suite to the front line.

How strong was our culture before the pandemic? If you’re like many executives we know, you see a return to the office as a way to address lingering culture and connectivity concerns. Or you prefer a full return to the office because you miss it yourself (a case of “absence makes the heart grow fonder”). You should remember that although the needs of your employees have changed, your culture may not have kept up, and any prior organizational weaknesses are now magnified. Employees will have little tolerance for a return to a status quo they didn’t like before.

Is our work environment transactional? If your only response to attrition is to raise compensation, you’re unwittingly telling your people that your relationship with them is transactional and that their only reason to stay with you is a paycheck. Your very best people will always have a better cash offer somewhere else. You want to solve the problems of the whole person (not just their bank accounts) as well as the whole organization.

Are our benefits aligned with employee priorities? Free parking or entertainment-related perks are probably not top of mind for employees right now. Among survey respondents who had left their jobs, 45 percent cited the need to take care of family as an influential factor in their decision. A similar proportion of people who are thinking of quitting cited the demands of family care. Expanding childcare, nursing services, or other home- and family-focused benefits could help keep such employees from leaving and show that you value them as whole people. Patagonia, long the standard-bearer for progressive workplace policies, retains nearly 100 percent of its new moms with on-site childcare and other benefits for parents.

Employees want career paths and development opportunities. Can we provide it? Employees are looking for jobs with better, stronger career trajectories. They desire both recognition and development. Smart companies find ways to reward people by promoting them not only into new roles but also into additional levels within their existing ones. This is one way companies can more quickly reward and recognize people for good work. Waffle House famously offers three levels for grill positions—which at other companies is just one role. Entry-level cooks are “grill operators,” more experienced cooks “master grill operators,” and the best cooks are known as “rock star grill operators,” or more colloquially as “Elvis on the grill.”

How are we building a sense of community? Remote work is no panacea, but neither is a full on-site return. In-person connectivity continues to have massive benefits for your organization. But it will require considerable management attention to get right as health and safety concerns continue to evolve, particularly because employees’ needs and expectations have changed. For example, employees with unvaccinated young children may feel unsafe at large in-person gatherings. One organization took an inclusive approach by sending out themed “staycation” packages: a movie night with popcorn and a gift card; a game night with family-oriented games, chips, and salsa; and a “virtual spa day” complete with face masks, tea, and chocolate. The company created a Slack channel for posting photos and stories, encouraging employees to share these experiences. Another organization encouraged connectivity among employees by offering coffee gift cards to those who signed up to participate in one-on-one “coffee chats” with employees they didn’t know—a perk that improved connectivity and helped people expand their networks.

If you lead a large team or a company, remember this: the Great Attrition is real, will continue, and may get worse before it gets better. Yet this unique moment also represents a big opportunity. To seize it, take a step back, listen, learn, and make the changes employees want—starting with a focus on the relational aspects of work that people have missed the most. By understanding why they are leaving and by acting thoughtfully, you may just be able to turn the Great Attrition into the Great Attraction.

About the author(s)

Aaron De Smet is a senior partner in McKinsey’s New Jersey office, Bonnie Dowling is an associate partner in the Denver office, Marino Mugayar-Baldocchi is a research science specialist in the New York office, and Bill Schaninger is a senior partner in the Philadelphia office.

The authors wish to thank Bryan Hancock, Randy Lim, David Mendelsohn, Mihir Mysore, and Nicolette Rainone for their contributions to this article and its underlying research.

This article was edited by Tom Fleming, an executive editor in the Chicago office.

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The “Great Resignation” in perspective

There is no question that the coronavirus disease 2019 (COVID-19) pandemic has wreaked havoc on the U.S. labor market. Multiple waves of COVID-19, along with efforts to limit disease spread and offset its economic impacts, have led to dramatic ups and downs in the economy. After reaching 10.0 percent in October 2009, 1 shortly after the end of the 2007–09 Great Recession, the unemployment rate fell steadily, reaching 3.5 percent just before the onset of the pandemic. The unemployment rate then more than quadrupled, reaching 14.7 percent in April 2020. Since then, however, the unemployment rate has fallen steadily, standing at 3.8 percent in February 2022.

A little over a year after the COVID-19 pandemic began, economists and other observers took note of a rising job quit rate, as measured by the U.S. Bureau of Labor Statistics (BLS) Job Openings and Labor Turnover Survey (JOLTS) program. JOLTS recorded a seasonally adjusted quit rate of 2.4 percent in the second month of the program’s existence (January 2001), and although this level was matched at other times, it was not surpassed until March 2021, when the quit rate reached 2.5 percent. This new record was quickly eclipsed in April 2021, when the quit rate stood at 2.8 percent; the current record is 3.0 percent, first reached in November 2021 and matched in December 2021. The rise in the quit rate has been called the “Great Resignation,” with many articles in the popular press speculating about why individuals have become more willing to leave their current employers. 2 The fact that the labor force participation rate remains below its prepandemic high suggests that some of those who quit their jobs found new jobs and others exited the labor force.

In this article, I provide some additional perspectives on trends in quit rates. First, I address the variation in quit rates that might occur from month to month because of statistical chance, given that these rates are measured through a sample rather than a census of establishments. Next, I examine data on quit rates predating the JOLTS program, to see whether the rates we have been observing recently are high relative to those in the second half of the 20th century. I then examine available JOLTS estimates to understand why they have risen of late. How much of the rise can be explained simply by the labor market tightening that began after the Great Recession and then, following a brief downturn during the pandemic recession in the first half of 2020, resumed its course? Have there been shifts in employment to industries in which quit rates tend to be higher, or have quit rates risen across industries?

Data on labor turnover

In a 1982 Monthly Labor Review article, Carol M. Utter detailed the BLS experience with labor turnover surveys (which primarily covered manufacturing) during the 20th century. 3 From 1930 until budget cutbacks ended the BLS Labor Turnover Survey (LTS) in December 1981, information was collected on both accessions to an employer’s workforce (broken down, at times, into new hires, recalls, and transfers) and separations (divided into quits, layoffs, and discharges). However, the process by which these earlier estimates were produced was inconsistent over time, and it is inconsistent with the current process under JOLTS.

In 1926, the Metropolitan Life Insurance Company initiated a labor turnover survey (which would eventually develop into the LTS) in order to enable personnel managers in manufacturing plants to assess where their employees stood relative to national benchmarks. In 1929, this project was turned over to BLS, which began collecting monthly data in 1930. BLS started with a sample of 175 large establishments, accounting for 25 percent of manufacturing employment, and, over the next 10 years, expanded the sample size. According to the National Bureau of Economic Research, the calculation of quit rates did not cover all manufacturing workers until 1943, because, prior to that year, it included only production workers. 4

While BLS was increasing the sample size for the LTS, some state employment security agencies affiliated with the U.S. Employment Service of the Department of Labor began collecting labor turnover data for their own purposes. BLS began to enter cooperative agreements with state agencies for the joint collection of these data, starting with an agreement with Connecticut in 1954. By 1964, these agreements reached all 50 states and the District of Columbia, with the LTS sample totaling 40,000 reporting establishments in manufacturing and mining. 5 Before the LTS was discontinued in 1981, there was a brief period during which the survey also collected job openings data, as well as information on some nonmanufacturing industries in certain metropolitan areas.

Nearly two decades later, BLS resumed the collection of information on job openings and labor turnover by initiating JOLTS. This survey, which first released official estimates in December 2000, currently has a sample of about 20,700 nonfarm business and government establishments covering the entire nonagricultural workforce, including workers employed in manufacturing, services, and government. Besides differing in scope, the LTS and JOLTS differ in their definitions of key concepts. The LTS defines quits as (1) terminations of employment initiated by the employee, (2) instances of failure to report for work after being hired (if the employee was previously counted as a new hire), and (3) unauthorized absences from work if, on the last business day of the month, the employee has been absent for more than 7 consecutive calendar days. 6 The second and third categories likely are very small relative to the first, but precise data on their relative size do not exist. JOLTS defines quits as employees who left their job voluntarily, excluding those who retired or transferred to other locations. 7 Quit rates are computed by first estimating the number of quits for the entire reference month and then dividing total quits in a sector by employment in that sector. The resulting ratios are multiplied by 100 and converted into percentages.

The JOLTS design is based on a random sample stratified by ownership, region, industry sector, and establishment size class. Surveyed establishments are drawn from a universe of more than 9.4 million establishments compiled by the BLS Quarterly Census of Employment and Wages program. This universe includes all employers subject to state unemployment insurance laws and all federal agencies subject to the Unemployment Compensation for Federal Employees program. Each month, employment estimates are benchmarked (or ratio adjusted) to the strike-adjusted employment estimates of the Current Employment Statistics survey.

To avoid mistaking random fluctuations for genuine trends, one should keep in mind how large a change in quit rates must be in order to be statistically significant. For this purpose, JOLTS publishes, for each year and each series, median standard errors, which are derived from the standard errors of not seasonally adjusted monthly estimates for the previous 5 years. Using these standard errors, one can form confidence intervals around two estimates being compared; if the intervals overlap, the difference between the estimates is not statistically significant. 8 Alternatively, JOLTS also publishes, on a monthly basis and by series, the minimum month-to-month and year-to-year changes required for statistical significance.

Armed with standard errors, one can assess which recent month-to-month and year-to-year changes are statistically significant. The standard error for the economywide quit rate in 2021 was 0.050, while that for 2020 was 0.046. By creating confidence intervals around monthly quit-rate estimates during these 2 years and by checking whether these intervals overlap, one can easily see that changes of 0.2 percentage points or more are significant at the 5-percent level. The quit rate rose from 1.6 percent in April 2020 to 3.0 percent in November 2021, a gain of 1.4 percentage points; the 95-percent confidence intervals for these rates are more than 1.2 percentage points apart.

Historical data on quit rates

Thus far, the discussion has centered on seasonally adjusted (as opposed to not seasonally adjusted) quit rates. Over the course of a given year, the pattern of quits, just like that of many other labor market phenomena, is affected by seasonal trends. For instance, people enrolled in school may quit their summer jobs at the end of the season in order to return to full-time study. Likewise, individuals thinking of leaving a job may stay on past the end of the year so not to miss out on a holiday bonus. Separating the effects of these seasonal events from trends over time customarily involves presenting seasonally adjusted statistics. Because this section compares seasonally adjusted JOLTS data with historical data, performing a valid comparison requires the use of seasonally adjusted historical data as well.

LTS seasonally adjusted data are available only for the 1959–81 period, only for manufacturing. Although manufacturing was a larger part of the economy in that period than it has been under JOLTS, it still did not account for most of the economy. Yet, it remains possible to better understand current quit rates by comparing historical manufacturing quit rates with 21st-century quit rates in manufacturing and the overall economy (excluding agriculture).

For this comparison, it may be informative to provide some context on manufacturing’s place in the economy in the two eras. According to data from the U.S. Bureau of Economic Analysis, manufacturing was the largest major sector of the economy from 1959 to 1981, accounting for an average of about 24 percent of gross domestic product (GDP). 9 In contrast, since the beginning of JOLTS in 2000, manufacturing has accounted for half that share, or about 12 percent of GDP. 10 Because sectors with higher average pay tend to have lower quit rates—a relationship discussed in more detail below—it is also informative to see how manufacturing compares with other sectors in terms of compensation in both periods. From 1959 to 1981, manufacturing compensation per full-time equivalent employee—a broad measure of average pay—exceeded compensation in nonmanufacturing industries by about 20 percent, on average. 11 Although manufacturing has shrunk as a share of GDP, it remains a relatively high-paying sector, employing workers who have averaged a 15-percent compensation premium since JOLTS began. 12

Because the seasonally adjusted quit rates from the LTS are available only for manufacturing, they cannot be used to assess the aforementioned general proposition positing a negative relationship between pay and quit rates across sectors. 13 For the 2001–20 period, it is possible to use JOLTS data to calculate average annual quit rates for each of 18 sectors and then correlate these rates with the ratio of compensation to the number of full-time equivalent employees. Making this computation and averaging the correlation coefficients over the years in the period, one obtains a coefficient of −0.64 for the case in which the sectors are not weighted by their employment and a coefficient of −0.69 for the case in which the sectors are weighted. (A correlation coefficient of −1.00 indicates a perfect negative relationship.) Thus, there is evidence that higher pay deters quitting, although compensation is far from being the only factor.

Examining the relationship between quit rates in manufacturing and quit rates in the total economy during the JOLTS period can reveal what economywide quit rates would have been back in the 1960s and 1970s, had they been measured by the LTS. Chart 1 displays the quit rates for manufacturing and the total economy from December 2000 (just before the start of the 2001 recession) to December 2021. A few things are notable from the graph. First, quit rates generally rose during the period’s two long expansions, which lasted from November 2001 to December 2007 and from June 2009 to February 2020. Second, in 2021, the economywide quit rates rose to levels not seen in the earlier history of JOLTS, peaking at 3.0 percent. Third, manufacturing quit rates followed a pattern nearly identical to that of economywide quit rates, with a correlation coefficient of 0.90 between the two series (the maximum coefficient is 1.00). Finally, in every month over the period, the manufacturing quit rate was lower than the economywide quit rate.

These relationships, along with the fact that data for manufacturing exist for the 1959–81 period, suggest the following experiment. Assuming that the relationship between manufacturing and economywide quit rates was the same over this period as it has been since the turn of the 21st century, one can estimate what economywide quit rates would have been in the 1960s and 1970s. To do so, one can use linear regression and the following specification:

where QR E,m is the economywide quit rate in month m , QR M,m is the manufacturing quit rate in month m , b 0 is the constant, b 1 is the coefficient, and ε m is the error term. The regression can be run by using the JOLTS data, which provide quit rates for both manufacturing and the total economy. Then, the estimated coefficients and the manufacturing quit rates from the LTS can be used to predict what the economywide quit rates might have been from 1959 to 1981. This calculation is based on the following equation:

Running regression (1) by using information from JOLTS for the period from December 2000 to December 2021, one arrives at the following relationship:

Plugging the manufacturing quit rates for 1959–81 in equation (3), one can obtain an estimate of what the economywide quit rates would have been during that period. Chart 2 displays the results of this calculation, showing both actual manufacturing quit rates and predicted economywide quit rates. According to these estimates, the highest economywide quit rates were seen in 1973, toward the end of the business cycle expansion that took place between November 1970 and November 1973, with rates hitting as high as 3.3 percent, exceeding the JOLTS high by 0.3 percentage points, or roughly 10 percent. The estimated quit rates also exceeded 3.0 percent in the last year of the expansion from February 1961 to December 1969.

While these estimates suggest that quit rates in the past have reached levels as high as those seen recently, they come with some caveats. Besides the fact that the economywide estimates are based on a simple backward extrapolation of the current relationship between manufacturing and total quit rates, LTS microdata are unavailable, so it is not possible to assess statistical significance. In addition, as noted earlier, quits are defined slightly more broadly in the LTS than in JOLTS, which suggests that one might need to lower the economywide quit-rate estimate. On the other hand, as also noted previously, manufacturing provided higher pay in the 1960s and 1970s than in the 21st century, which indicates a bigger gap between the manufacturing quit rate and the economywide quit rate.

Why did quit rates rise in 2021?

This section evaluates whether a tightening of the labor market can explain the recent rise in quit rates. It also examines which sectors of the economy have contributed the most to that rise.

Measures of labor market slack and rates of resignation

Although, as noted, historical quit rates in the United States have likely reached levels as high as those observed today, it remains unclear why the rates seen over the last year are higher than those recorded in the preceding two decades. One likely reason for this difference is labor market tightness, and there are many possible explanations for why and how the labor market rebounded after the pandemic-induced recession in the first half of 2020. These explanations focus on developments such as the end of lockdowns, the stimulus coming from increased generosity of and enhanced eligibility for unemployment insurance benefits, relief payments to individuals, and increases in food assistance. Other developments that may have caused individuals to leave their jobs (and perhaps the labor force) include the desire of workers to protect themselves and their families from COVID-19, as well as challenges in providing childcare as a result of pandemic-related closures of childcare centers and the widespread use of remote schooling. 14 Although it is beyond the scope of this article to test each of these explanations individually, they all suggest a tightening of the labor market. It is possible to assess whether the recent rise in quit rates is merely a function of a decline in labor market slack.

It has already been noted that quit rates tend to rise during expansions, when workers’ prospects for finding a better job brighten. With the unemployment rate having returned to low levels, is the recent increase in quit rates merely a function of a tightening labor market?

Addressing this question requires a measure of labor market slack. How this measure should be constructed is an active area of research, and currently no consensus exists on the best measurement approach. As discussed by Katharine G. Abraham, John C. Haltiwanger, and Lea E. Rendell, the unemployment rate has long been used as a measure of labor market tightness, given its evident correlation with the business cycle. 15 The increased popularity among economists of search-and-matching models—which seek to explain a number of features of the macroeconomy—has increased the importance of considering job openings along with the unemployment rate. In these models, labor market tightness is measured by the ratio of job openings (the number of positions employers wish to fill) to the level of unemployment (the number of people who do not have a job and actively look for work). Thus, the higher the ratio, the tighter the labor market. Abraham, Haltiwanger, and Rendell develop what they term a “generalized measure of labor market tightness,” a measure whose denominator accounts for all potential jobseekers (not just the unemployed) and whose numerator is adjusted for firms’ recruiting intensity. 16 Regis Barnichon and Adam Hale Shapiro recently looked at nine different measures of slack, testing their ability to predict inflation. 17

Again using linear regression, the analysis below examines whether the relationship between quit rates and two measures of labor market tightness or slack—the unemployment rate and the ratio of job openings to the number of unemployed people 18 —has changed since COVID-19 began. 19 Because economic theory does not dictate the form of this relationship, two regression specifications are used. In the first specification, quit rates are a linear function of labor market slack:

Because quits are responding to the level of labor market tightness, the dependent variable in equation (4)—the quit rate—is specified as a function of the lagged value of the measure of labor market tightness, where the lag is 1 month. The second specification allows a more general relationship between slack and quit rates, positing quit rates as a quadratic function of slack:

For each measure, two regressions—one linear and one quadratic—are first run on the entire sample of JOLTS economywide quit rates, to get a sense of the relationship for the entire period from December 2000 to December 2021. The sample is then restricted to the prepandemic period (December 2000–February 2020), and the relationship found for this time span is projected forward, up through the end of 2021. If the regressions underpredict the quit rates, one can infer that the relationship between labor market tightness and quit rates has changed such that, at any given level of labor market tightness, there is now more quitting. Conversely, if the regressions overpredict the quit rates, one can infer that there is now less quitting at given levels of labor market tightness.

Table 1 summarizes the regression results. The table’s first data row (linear specification) in panel A shows that, as expected, when the unemployment rate goes up, the quit rate goes down. The quadratic specification, presented in the second data row, shows a similar relationship, although in this case the positive sign on the squared term indicates that the slope tends to be less negative at higher unemployment rates. The fit for the quadratic specification ( R -squared of 0.58) is better than that for the linear specification ( R -squared of 0.52). The next two rows of table 1 repeat these specifications, this time for the prepandemic period. The fit is now much better, with R -squared climbing above 0.9 for both the linear and quadratic specifications.

In the linear specification, the predicted quit rates are lower than the actual rates by an average of 0.74 percentage points for all of 2021 and by 0.82 percentage points for the second half of the year. In the quadratic specification, these differences are, respectively, 0.76 percentage points and 0.83 percentage points, showing a similar underprediction. Thus, both specifications suggest that, during the pandemic, the relationship between the unemployment rate and the quit rate has changed such that, at any level of the unemployment rate, the recent period exhibits a higher rate of quitting.

Because this finding could be sensitive to the choice of measure of labor market tightness, it is useful to try the alternative measure mentioned earlier, namely, the ratio of job openings to the number of unemployed people. As shown in panel B of table 1, the results based on this alternative measure for the entire JOLTS period indicate that the quadratic specification is a better fit ( R -squared of 0.76) than the linear specification ( R -squared of 0.70). As expected, both specifications suggest that when the labor market tightens, the quit rate goes up. When the regression is restricted to the prepandemic period from December 2000 through February 2020, the fit is much improved for the quadratic specification ( R -squared of 0.88) and mildly improved for the linear specification ( R -squared of 0.74). As with the regression using the unemployment rate as a measure of slack, the coefficients obtained for this shortened period are extrapolated to the period from March 2020 through December 2021, with the ratio of job openings to the number of unemployed people being used to make predictions.

In the quadratic specification, the model underpredicts the rate of quitting by an average of about 0.53 percentage points for all of 2021 and by 0.73 percentage points for the second half of the year. These levels of underprediction are somewhat lower than those obtained for the quadratic specification in the analysis using the unemployment rate as a measure of labor market tightness. The linear model also underpredicts the rate of quitting, although the levels of underprediction in this case average just 0.33 percentage points for all of 2021 and 0.26 percentage points for the second half of that year. Thus, while the levels of underprediction differ somewhat across specifications and measures, they consistently suggest that the relationship between labor market slack and quit rates has changed such that, conditional on the level of slack, there is a higher level of quitting in the recent period.

In sum, the results of the regression analysis suggest that if the relationship between quit rates and labor market slack had not changed, quit rates would still have risen from their April 2020 level of 1.6 percent, albeit not to the heights actually seen. For the linear and quadratic specifications using the unemployment rate as a measure of labor market tightness, the model predicts that quit rates would have risen to 2.2 percent. The linear model based on the ratio of job openings to the number of unemployed people predicts a peak of 2.3 percent. Only in the quadratic model for this measure do the predicted quit rates come close to the actual rates, with the predicted high being 2.9 percent.

Decomposition of the rise in quit rates

The preceding analysis indicates that the quit rates recorded recently are high for the 21st century, even after accounting for the degree of labor market tightness. Given this finding, it is useful to examine which sectors of the economy are contributing most to the rise in quit rates. One standard way to do this is through a decomposition analysis, whereby the change in the quit rate over a given period can be broken into three components: (1) a “within” component attributable to increases in quit rates within sectors, (2) a “between” component attributable to shifts in employment across sectors, and (3) a component attributable to an interaction of the “between” and “within” components. The equation for the decomposition is

where QR is the quit rate, π s 0 is the share of employment in sector s at the beginning of the period, π s 1 is the share of employment in sector s at the end of the period, and S is the number of sectors. The expression in the first set of square brackets is the “within” component, that in the second set of brackets is the “between” component, and that in the third set of brackets is the interaction term. The decomposition is performed for two periods: (1) from the end of the Great Recession in June 2009 to the peak in quit rates in November 2021, and (2) from April 2020 (after the quit rate fell early in the pandemic) to November 2021. Because neither of these periods is very long, one would not expect major shifts in employment across sectors and, thus, a large “between” component. Nonetheless, the decomposition technique can reveal which sectors contribute the most to the “within” component, possibly providing clues about why quit rates have been rising.

Panel A of table 2 displays the decomposition for the period from April 2020 to November 2021, during which the total nonfarm quit rate (see bottom of panel) nearly doubled, from 1.6 percent to 3.0 percent. Besides displaying this overall rate, the table shows quit rates for 19 industry sectors, indicating that, at the beginning of the period, these rates ranged from 0.6 percent for the federal government and durable goods manufacturing all the way up to 3.8 percent for accommodation and food services. As noted earlier, sectors with higher compensation tend to have lower quit rates. During the 19-month period, all sectors saw quit-rate increases, although these increases were quite small for the federal government, state and local government education, and educational services. In fact, the change for these sectors is not statistically significant, nor is it for the information sector.

Calculating the “within” component of the decomposition involves taking the change in quit rates in a sector and weighting it by the sector’s employment share. As seen in the table, the “within” component was responsible for more than 1.2 percentage points of the 1.4-percentage-point increase in the total nonfarm quit rate during the period, suggesting that the “between” component and the interaction term were unimportant. The sectors with the greatest contribution to this component were retail trade, professional and business services, accommodation and food services, and healthcare and social assistance. The “within” components of these four sectors were responsible for about 61 percent of the overall “within” component, 20 both because these sectors had large increases in their quit rates and because all of them, except accommodation and food services, were relatively large.

Panel B of table 2 displays an identical decomposition for the period from June 2009 to November 2021, during which the total nonfarm quit rate (see bottom of panel) rose from 1.3 percent to 3.0 percent. Although this longer period allows for greater shifts in employment across sectors, the case remains that the “within” component of the decomposition was responsible for nearly the entire quit-rate increase. Over the period, all sectors, including the federal government and educational services, saw notable increases in their quit rates, and these increases were all statistically significant, with the exception of that for other services. The sectors with the greatest contribution to the “within” component (about 66 percent) were the same as those identified in the first decomposition, but their ordering is somewhat different, with accommodation and food services having the largest contribution, followed by retail trade, professional and business services, and healthcare and social assistance. 21

This finding is partly consistent with a recent study by the Pew Research Center, according to which most workers who quit their jobs in 2021 cited low pay, no advancement opportunities, and feeling disrespected as the main reasons for their resignations. 22 Indeed, compensation-based factors are relevant to the low-paying sectors of retail trade and accommodation and food services. However, the other factors identified in the Pew study could apply to any industry sector, and the study did not examine the reasons for the change in quit rates. In the case of healthcare and social assistance, one can also speculate that the COVID-19 pandemic might have made some healthcare-related jobs more stressful, leading to worker burnout and higher quit rates.

This article has offered a broader perspective on the recent rise in quit rates, a phenomenon called the “Great Resignation.” The historical data examined in the article suggest that recent quit rates, while certainly high for the 21st century, are not the highest historically. Nonetheless, the pace of resignations seems to have risen more quickly than one would have expected from labor market tightening alone. Future research should assess alternative explanations for this development, taking into account pandemic-related factors such as increased stimulus payments, health concerns, childcare issues, and changing attitudes toward work. Examining which demographic groups have seen their quit rates rise most quickly might provide clues here. 23 Future research should also pinpoint what is happening to workers who are resigning for the first time: are they leaving the labor force or moving on to better jobs?

Maury Gittleman, "The “Great Resignation” in perspective," Monthly Labor Review, U.S. Bureau of Labor Statistics, July 2022, https://doi.org/10.21916/mlr.2022.20

1 This unemployment rate, available from the U.S. Bureau of Labor Statistics, is seasonally adjusted. Unless otherwise noted, all indicators provided in the article are seasonally adjusted.

2 Examples of such articles include Rashida Kamal, “‘The Great Resignation’: June’s U.S. jobs report hides unusual trend,” The Guardian , July 3, 2021, https://www.theguardian.com/business/2021/jul/03/us-jobs-report-june-trend ; Derek Thompson, “Three myths of the Great Resignation,” The Atlantic , December 8, 2021, https://www.theatlantic.com/ideas/archive/2021/12/great-resignation-myths-quitting-jobs/620927/ ; and Kate Morgan, “The Great Resignation: how employers drove workers to quit,” BBC , June 29, 2021, https://www.bbc.com/worklife/article/20210629-the-great-resignation-how-employers-drove-workers-to-quit .

3 Carol M. Utter, “Labor turnover in manufacturing: the survey in retrospect,” Monthly Labor Review , June 1982, pp. 15–17, https://www.bls.gov/opub/mlr/1982/06/art3full.pdf .

4 “Labor turnover, quit rate, manufacturing,” NBER series 08251 (Cambridge, MA: National Bureau of Economic Research), https://data.nber.org/databases/macrohistory/rectdata/08/docs/m08251b.txt .

5 Estimates were reported not only for manufacturing as a whole, but also for individual manufacturing industries.

6 Katherine Bauer, “Differences between JOLTS and LTS programs,” unpublished memorandum (U.S. Bureau of Labor Statistics, May 27, 2016).

7 See ibid.; and Job openings and labor turnover—December 2021 , USDL-22-0152 (U.S. Department of Labor, February 1, 2022), https://www.bls.gov/news.release/archives/jolts_02012022.pdf .

8 A 10-percent confidence interval around an estimate µ is given by µ ± 1.64 σ , where σ is the standard error.

9 “Value added as a percentage of gross domestic product, 1947–1987” (U.S. Bureau of Economic Analysis).

10 “Value added by industry as a percentage of gross domestic product,” annual data from 1997 to 2020 (U.S. Bureau of Economic Analysis).

11 “Compensation of employees, 1947–1987” (U.S. Bureau of Economic Analysis); and “Full-time equivalent employees, 1948–1987” (U.S. Bureau of Economic Analysis). These data, which are based on the 1972 Standard Industrial Classification system, were used to calculate, for each year, ratios of compensation to number of full-time equivalent employees both in manufacturing and in the total economy minus manufacturing. An unweighted average of these ratios was then computed for manufacturing and the total economy minus manufacturing.

12 “Compensation of employees,” annual data from 1998 to 2020 (U.S. Bureau of Economic Analysis); and “Full-time equivalent employees,” annual data from 1998 to 2020 (U.S. Bureau of Economic Analysis).

13 For some evidence on, and a discussion of, the relationship between compensation and turnover, see Harley Frazis and Mark A. Loewenstein, “How responsive are quits to benefits?” Journal of Human Resources , vol. 48, no. 4, fall 2013, pp. 969–997.

14 See, for example, Titan Alon, Matthias Doepke, Jane Olmstead-Rumsey, and Michèle Tertilt, “This time it’s different: the role of women’s employment in a pandemic recession,” Working Paper 27660 (Cambridge, MA: National Bureau of Economic Research, August 2020); Alexander W. Bartik, Marianne Bertrand, Feng Lin, Jesse Rothstein, and Matthew Unrath, “Measuring the labor market at the onset of the COVID-19 crisis,” Working Paper 27613 (Cambridge, MA: National Bureau of Economic Research, July 2020); and R. Jason Faberman, Andreas I. Mueller, and Ayşegül Şahin, “Has the willingness to work fallen during the Covid pandemic,” Working Paper 29784 (Cambridge, MA: National Bureau of Economic Research, February 2022).

15 Katharine G. Abraham, John C. Haltiwanger, and Lea E. Rendell, “How tight is the U.S. labor market?” Brookings Papers on Economic Activity , spring 2020, pp. 97–138, https://www.brookings.edu/wp-content/uploads/2020/12/Abraham-final-web.pdf .

17 Regis Barnichon and Adam Hale Shapiro, “What’s the best measure of economic slack?” FRBSF Economic Letter (Federal Reserve Bank of San Francisco, February 22, 2022), https://www.frbsf.org/economic-research/publications/economic-letter/2022/february/what-is-best-measure-of-economic-slack/ .

18 Although, as noted, there are other measures of labor market slack, they are not appropriate for the present analysis. Some of them, such as job switching, are too close to being measures of the phenomenon for which an explanation is sought, and others, such as Abraham, Haltiwanger, and Rendell’s measure, are available only for the prepandemic period.

19 It is common for analysts to check whether the relationship expressed in a regression model has changed over time by looking for what is known as a structural break. Here, coefficients for the period preceding the structural break are compared with coefficients for the period following the structural break, to see if their differences are statistically significant. Although tests for the presence of a structural break at a known time reject the hypothesis that there was no structural break just before the onset of the pandemic, the fact that there are fewer than 2 years’ worth of observations following this break means that one cannot estimate the postpandemic relationship very precisely. This issue limits the utility of comparing coefficients before and after the break.

20 These sectors accounted for 44.5 percent of employment at the beginning of the period.

21 These sectors accounted for 44.6 percent of employment at the beginning of the period.

22 Kim Parker and Juliana Menasce Horowitz, “Majority of workers who quit a job in 2021 cite low pay, no opportunities for advancement, feeling disrespected” (Washington, DC: Pew Research Center, March 9, 2022), https://www.pewresearch.org/fact-tank/2022/03/09/majority-of-workers-who-quit-a-job-in-2021-cite-low-pay-no-opportunities-for-advancement-feeling-disrespected/ .

23 For some analysis along demographic lines, see Bart Hobijn, “‘Great Resignations’ are common during fast recoveries,” FRBSF Economic Letter (Federal Reserve Bank of San Francisco, April 4, 2022), https://www.frbsf.org/wp-content/uploads/sites/4/el2022-08.pdf .

Maury Gittleman [email protected]

Maury Gittleman is a research economist in the Office of Compensation and Working Conditions, U.S. Bureau of Labor Statistics.

Job openings and quits reach record highs in 2021, layoffs and discharges fall to record lows , Monthly Labor Review , June 2022.

As the COVID-19 pandemic affects the nation, hires and turnover reach record highs in 2020 , Monthly Labor Review , June 2021.

Labor turnover in manufacturing: the survey in retrospect , Monthly Labor Review , June 1982.

Toxic Culture Is Driving the Great Resignation

Research using employee data reveals the top five predictors of attrition and four actions managers can take in the short term to reduce attrition.

Measuring Culture

More than 40% of all employees were thinking about leaving their jobs at the beginning of 2021, and as the year went on, workers quit in unprecedented numbers. 1 Between April and September 2021, more than 24 million American employees left their jobs, an all-time record. 2 As the Great Resignation rolls on, business leaders are struggling to make sense of the factors driving the mass exodus. More importantly, they are looking for ways to hold on to valued employees.

To better understand the sources of the Great Resignation and help leaders respond effectively, we analyzed 34 million online employee profiles to identify U.S. workers who left their employer for any reason (including quitting, retiring, or being laid off) between April and September 2021. 3 The data, from Revelio Labs , where one of us (Ben) is the CEO, enabled us to estimate company-level attrition rates for the Culture 500 , a sample of large, mainly for-profit companies that together employ nearly one-quarter of the private-sector workforce in the United States. 4

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While resignation rates are high on average, they are not uniform across companies. Attrition rates for the six months we studied ranged from less than 2% to more than 30% across companies. Industry explains part of this variation. The graph below shows the estimated attrition rate for 38 industries from April through September, and the spread across industries is striking. (See “Industry Average Attrition Rate in the Great Resignation.”) Apparel retailers, on average, lost employees at three times the rate of airlines, medical device makers, and health insurers.

The Great Resignation is affecting blue-collar and white-collar sectors with equal force. Some of the hardest hit industries — apparel retail, fast food, and specialty retail — employ the highest percentage of blue-collar workers among all industries we studied. Management consulting, in contrast, had the second-highest attrition rate but also employs the largest percentage of white-collar professionals of any Culture 500 industry. Enterprise software, which also suffered high churn, employs the highest percentage of engineering and technical employees.

Industry explains some of the variation in attrition rates across companies but not all of it. Even within the same industry, we observed significant differences in attrition rates. The figure below compares competitors with high and low attrition rates within their industries. (See “How Culture 500 Company Attrition Rates Compare Within Industries.”) Workers are 3.8 times more likely to leave Tesla than Ford, for example, and more than twice as likely to quit JetBlue than Southwest Airlines.

Not surprisingly, companies with a reputation for a healthy culture, including Southwest Airlines, Johnson & Johnson, Enterprise Rent-A-Car, and LinkedIn, experienced lower-than-average turnover during the first six months of the Great Resignation.

Although the sample is small, these pairs hint at another, more intriguing pattern. More-innovative companies, including SpaceX, Tesla, Nvidia, and Netflix, are experiencing higher attrition rates than their more staid competitors. The pattern is not limited to technology-intensive industries, since innovative companies like Goldman Sachs and Red Bull have suffered higher turnover as well.

To dig deeper into the drivers of intra-industry turnover, we calculated how each Culture 500 company’s attrition rate compared with the average of its industry as a whole. This measure, which we call industry-adjusted attrition, translates each company’s attrition rate into standard deviations above or below the average for its industry. 5

We also analyzed the free text of more than 1.4 million Glassdoor reviews, using the Natural Employee Language Understanding platform developed by CultureX , a company two of us (Donald and Charles) cofounded. For each Culture 500 company, we measured how frequently employees mentioned 172 topics and how positively they talked about each topic. We then analyzed which topics best predicted a company’s industry-adjusted attrition rate.

Top Predictors of Employee Turnover During the Great Resignation

Much of the media discussion about the Great Resignation has focused on employee dissatisfaction with wages. How frequently and positively employees mentioned compensation, however, ranks 16th among all topics in terms of predicting employee turnover. This result is consistent with a large body of evidence that pay has only a moderate impact on employee turnover. 6 (Compensation can, however, be an important predictor of attrition in certain settings, such as nurses in large health care systems).

In general, corporate culture is a much more reliable predictor of industry-adjusted attrition than how employees assess their compensation. The figure below displays the five predictors of relative attrition. (See “Top Predictors of Attrition During Great Resignation.”) To give a sense of their relative importance, we’ve benchmarked each element relative to the predictive power of compensation. 7 A toxic corporate culture, for example, is 10.4 times more powerful than compensation in predicting a company’s attrition rate compared with its industry.

Let’s take a closer look at each of the top five predictors of employee turnover.

Toxic corporate culture. A toxic corporate culture is by far the strongest predictor of industry-adjusted attrition and is 10 times more important than compensation in predicting turnover. Our analysis found that the leading elements contributing to toxic cultures include failure to promote diversity, equity, and inclusion; workers feeling disrespected; and unethical behavior. In an upcoming article , we will dive deeper into each of these factors and examine different ways managers and employees can spot signals of toxic culture. 8 For now, the important point is that a toxic culture is the biggest factor pushing employees out the door during the Great Resignation.

Job insecurity and reorganization. In a previous article , we reported that job insecurity and reorganizations are important predictors of how employees rate a company’s overall culture. So it’s not surprising that employment instability and restructurings influence employee turnover. 9 Managers frequently resort to layoffs and reorganizations when their company’s prospects are bleak. Previous research has found that employees’ negative assessments of their company’s future outlook is a strong predictor of attrition. 10 When a company is struggling, employees are more likely to jump ship in search of more job security and professional opportunities. Past layoffs, moreover, typically leave surviving employees with heavier workloads, which may increase their odds of leaving.

Another reason job insecurity could predict turnover is related to our measure of employee attrition, which incorporates job changes for all causes — including layoffs and involuntary terminations. We would expect frequent mentions of reorganizations and layoffs to predict involuntary turnover. According to the U.S. Bureau of Labor Statistics, however, involuntary separations have accounted for less than one-quarter of all employee exits among large companies during the Great Resignation. 11 So it’s likely that poor career prospects and job insecurity contributed significantly to employees leaving on their own accord as well.

High levels of innovation. It’s not surprising that workers leave companies with toxic cultures or frequent layoffs. But it is surprising that employees are more likely to exit from innovative companies. In the Culture 500 sample, we found that the more positively employees talked about innovation at their company, the more likely they were to quit. The attrition rates of the three most innovative Culture 500 companies — Nvidia, Tesla, and SpaceX — are three standard deviations higher than those in their respective industries.

Staying at the bleeding edge of innovation typically requires employees to put in longer hours, work at a faster pace, and endure more stress than they would in a slower-moving company. The work may be exciting and satisfying but also difficult to sustain in the long term. When employees rate their company’s innovation positively, they are more likely to speak negatively about work-life balance and a manageable workload. During the Great Resignation, employees may be reconsidering the personal toll that relentless innovation takes.

Failure to recognize performance. Employees are more likely to leave companies that fail to distinguish between high performers and laggards when it comes to recognition and rewards. Companies that fail to recognize and reward strong performers have higher rates of attrition, and the same is true for employers that tolerate underperformance. The issue is not compensation below market rates, but rather recognition — both informal and financial — that is not linked to effort and results. High-performing employees are the most likely to resent a lack of recognition for their results, which means that companies may be losing some of their most productive workers during the Great Resignation.

Poor response to COVID-19. Employees who mentioned COVID-19 more frequently in their reviews or talked about their company’s response to the pandemic in negative terms were more likely to quit. The same pattern holds true when employees talk more generally about their company’s policies for protecting their health and well-being.

Short-Term Actions to Boost Retention

The powerful predictors of attrition listed above are not easy to change. A weak future outlook that spurs restructuring and layoffs may be difficult to reverse; it is too late to fix a poor response to the pandemic; and a toxic corporate culture cannot be improved overnight. Relentless innovation provides companies like Tesla or Nvidia with a competitive advantage, so they must find ways to retain employees without sacrificing their innovation edge.

Our analysis identified four actions that managers can take in the short term to reduce attrition. (See “Short-Term Steps for Companies to Increase Retention.”) As in the graph above, each bar represents the topic’s predictive power relative to compensation. This time, the topics predict a company’s ability to retain employees compared with industry peers. Providing employees with lateral career opportunities, for example, is 2.5 times more powerful as a predictor of a company’s relative retention rate compared with compensation.

Provide opportunities for lateral job moves. Not all employees want to climb the corporate ladder or take on additional work or responsibilities. Many workers simply want a change of pace or the opportunity to try something new. When employees talk positively about lateral opportunities — new jobs offering fresh challenges without a promotion — they are less likely to quit. Lateral career opportunities are 12 times more predictive of employee retention than promotions. We observed the same pattern in multinationals: The more frequently employees discussed the possibility of international postings, the more likely they were to stick with their current employer.

Sponsor corporate social events. Company-organized social events, including happy hours, team-building excursions, potluck dinners, and other activities outside the workplace are a key element of a healthy corporate culture, so it’s no surprise that they are also associated with higher rates of retention. 12 Organizing fun social events is a low-cost way to reinforce corporate culture as employees return to the office, and it strengthens employees’ personal connections to their team members.

Offer remote work options. Much of the media coverage of the Great Resignation has focused on the importance of remote work in retaining employees. Unsurprisingly, when employees discussed remote work options in more positive terms, they were less likely to quit. What you might not have expected is the relatively modest impact of remote work on retention — just a bit more powerful than compensation in predicting lower attrition. Remote work options may have a modest effect on employee turnover because most companies in an industry converge on similar policies. If companies cannot differentiate themselves based on remote work options, they may need to look elsewhere — providing lateral job opportunities, for instance, or making schedules more predictable — to retain employees.

Make schedules more predictable for front-line employees. When blue-collar employees describe their schedules as predictable, they are less likely to quit. Having a predictable schedule is six times more powerful in predicting front-line employee retention than having a flexible schedule. (A predictable schedule has no predictive power for white-collar employees.)

This finding is consistent with a study of 28 Gap stores, in which employees at randomly-assigned locations received their work schedules two weeks in advance, and their managers were barred from canceling their shifts at the last minute. Employees in the control stores were subject to the usual scheduling practices. 13 The stores with predictable schedules increased retention among their most experienced associates. Compared with the workers at the control stores, the employees with fixed schedules had a 7% improvement in their quality of sleep. The benefits were especially pronounced for workers with children, who reported a 15% reduction in stress.

Much of the media coverage of the Great Resignation focuses on high turnover among burned-out knowledge workers who are dissatisfied with their stagnant wages. Our findings are broadly consistent with this narrative. Industries that employ large numbers of professional and technical employees, like management consulting and enterprise software, have experienced high turnover. We found indirect evidence that burnout may contribute to higher levels of attrition among companies that excel at innovation. It’s worth noting, however, that our direct measures of burnout, workload, and work-life balance do not emerge as key predictors of industry-adjusted turnover.

The simplistic narrative of white-collar burnout misses other critical realities of the Great Resignation. Our findings reinforce recent government statistics showing that blue-collar intensive industries like retail and fast food are experiencing unprecedented levels of attrition. 14

More fundamentally, we found that corporate culture is more important than burnout or compensation in predicting which companies lost employees at a higher rate than their industries as a whole. A toxic corporate culture is the single best predictor of which companies suffered from high attrition in the first six months of the Great Resignation. The failure to appreciate high performers, through formal and informal recognition, is another element of culture that predicts attrition. A failure to recognize performance is likely to drive out a company’s most productive employees. This is not to argue that compensation and burnout don’t influence attrition — of course they do. The important point is that other aspects of culture appear to matter even more.

Our research identified four steps — offering lateral career opportunities, remote work, social events, and more predictable schedules — that may boost retention in the short term. Leaders who are serious about winning the war for talent during the Great Resignation and beyond, however, must do more. They should understand and address the elements of their culture that are causing employees to disengage and leave. And above all else, they must root out issues that contribute to a toxic culture. Our next article will explore, empirically, what constitutes a toxic culture and how organizations can address this challenge.

About the Authors

Donald Sull ( @culturexinsight ) is a senior lecturer at the MIT Sloan School of Management and a cofounder of CultureX. Charles Sull is a cofounder of CultureX. Ben Zweig is the CEO of Revelio Labs and an adjunct professor of economics at New York University’s Stern School of Business.

1. Microsoft sponsored a survey of over 30,000 employees across 31 markets in January 2021 for its Work Trend Index. See “ The Next Great Disruption Is Hybrid Work — Are We Ready? ” Microsoft, March 22, 2021, www.microsoft.com.

2. “ Job Openings and Labor Turnover Survey ,” U.S. Bureau of Labor Statistics, accessed Dec. 6, 2021, www.bls.gov. The data represents seasonally adjusted quits for total nonfarm employers in the U.S. from April through September 2021.

3. To test the accuracy of our estimates of employee attrition, we compared them with the November U.S. Bureau of Labor Statistics (BLS) Job Openings and Labor Turnover Survey (JOLTS) for total separations (including employee resignations, layoffs, and other sources of job separations) for private companies with more than 5,000 employees. The BLS total separation rate was 10.8% for April through September 2021, and our estimates were 10.1% for the same period.

4. To estimate turnover at the company level, we identified all job transitions where a user left their current employer for any reason, including quitting, retiring, or being laid off, and divided these by corporate head count. Job transitions were measured for April through September 2021 for 538 Culture 500 companies. The attrition rates are adjusted for sampling bias related to who has an online profile and for lags in when users reported transitions on their profiles. To test the robustness of our estimates of attrition, we separately estimated the hiring rate for each company for the same period. Hiring rate is defined as employees who joined the company divided by corporate head count. We would expect hiring and attrition rates to be correlated, as companies replace employees who leave. The Spearman correlation coefficient was 0.81 between the hiring and attrition rates.

5. We assigned each Culture 500 company to a primary industry and calculated how many standard deviations the focal company’s attrition rate was above or below the industry mean. We used the resulting industry-normalized attrition rate as the dependent variable in our subsequent models. To identify which factors were most important in predicting each company’s normalized attrition rate, we used an XGBoost model and calculated the SHAP (Shapley additive explanations) value for 172 topics measured by the CultureX Natural Employee Language Understanding platform. The SHAP value approach analyzes all possible combinations of features in a predictive model to estimate the marginal impact that each feature has on the outcome — in our case, which cultural elements have the biggest impact in predicting a company’s industry-normalized attrition rate. For an overview of SHAP models, see S.M. Lundberg, G. Erion, H. Chen, et al., “ From Local Explanations to Global Understanding With Explainable AI for Trees ,” Nature Machine Intelligence 2, no. 1 (January 2020): 56-67.

6. A.L. Rubenstein, M.B. Eberly, T.W. Lee, et al., “Surveying the Forest: A Meta-Analysis, Moderator Investigation, and Future-Oriented Discussion of the Antecedents of Voluntary Employee Turnover,” Personnel Psychology 71, no. 1 (spring 2018): 23-65; and D.G. Allen, P.C. Bryant, and J.M. Vardaman, “Retaining Talent: Replacing Misconceptions With Evidence-Based Strategies,” Academy of Management Perspectives 24, no. 2 (May 2010): 48-64.

7. Relative importance is calculated by dividing each topic’s SHAP value by the SHAP value for the compensation topic. When highly predictive features are closely related (such as job insecurity and restructuring), we report their combined predictive impact.

8. Jason Sockin finds that “respect/abuse,” a topic that overlaps with our definition of toxic culture, is the single best predictor of employee satisfaction. See J. Sockin, “ Show Me the Amenity: Are Higher-Paying Firms Better All Around? ” SSRN, Nov. 18, 2021, https://papers.ssrn.com.

9. D. Sull and C. Sull, “ 10 Things Your Corporate Culture Needs to Get Right ,” MIT Sloan Management Review, Sept. 16, 2021, https://sloanreview.mit.edu.

10. B. Zweig and D. Zhao, “Looking for Greener Pastures: What Workplace Factors Drive Attrition?” PDF file (Mill Valley, California: Glassdoor, 2021), www.glassdoor.com. A recent meta-analysis also found that job insecurity was a strong predictor of voluntary employee turnover. See A.L. Rubenstein et al., “Surveying the Forest,” 23-65.

11. In the November BLS JOLTS, seasonally adjusted layoffs and discharges for all private companies with more than 5,000 employees represented 24% of total separations for April through September 2021.

12. D. Sull and C. Sull, “10 Things.”

13. J.C. Williams, S.J. Lambert, S. Kesavan, et al., “ Stable Scheduling Increases Productivity and Sales: The Stable Scheduling Study ,” PDF file (San Francisco: Center for WorkLife Law, 2018), https://worklifelaw.org.

14. “ Job Openings and Labor Turnover Summary ,” U.S. Bureau of Labor Statistics, Dec. 8, 2021, www.bls.gov.

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The Great Resignation Didn’t Start with the Pandemic

Five forces driving the long-term trend.

Covid-19 spurred on the Great Resignation of 2021, during which record numbers of employees voluntarily quit their jobs. But what we are living through is not just short-term turbulence provoked by the pandemic. Instead, it’s the continuation of a trend of rising quit rates that began more than a decade ago. Five main factors are at play in this trend: retirement, relocation, reconsideration, reshuffling, and reluctance . All of these factors, the authors argue, are here to stay. They explore each in turn and encourage leaders to examine which of them are contributing most to turnover in their organizations, so that they can adapt appropriately as they move into the future.

The numbers are sobering.

In 2021, according to the U.S. Bureau of Labor Statistics, over 47 million Americans voluntarily quit their jobs — an unprecedented mass exit from the workforce, spurred on by Covid-19, that is now widely being called the Great Resignation. Worker shortages are apparent everywhere: Gas stations and dentists offices alike have reduced their hours of operation because they can’t find new employees to replace those who have quit. The Great Resignation, we’re told, has upended the relationship between workers and the labor market.

But such talk is overblown. A record number of workers did quit their jobs in 2021, it’s true. However, if you consider that number in the context of total employment during the past dozen years, as illustrated in Figure 1, you can see that what we are living through is not just short-term turbulence provoked by the pandemic but rather the continuation of a long-term trend.

The figure — and the numbers — tell a clear story. From 2009 to 2019, the average monthly quit rate increased by 0.10 percentage points each year. Then, in 2020, because of the uncertainty brought on by the Covid-19 pandemic, the resignation rate slowed as workers held on to their jobs in greater numbers. That pause was short-lived. In 2021, as stimulus checks were sent out and some of the uncertainty abated, a record number of workers quit their jobs, creating the so-called Great Resignation. But that number included many workers who might otherwise have quit in 2020 had there been no pandemic. We’re now back in line with the pre-pandemic trend, which is one that American employers are likely to be contending with for years to come.

In our view, five factors, exacerbated by the pandemic, have combined to yield the changes that we’re living through in today’s labor market. We call these factors the Five Rs: retirement , relocation , reconsideration , reshuffling , and reluctance . Workers are retiring in greater numbers but aren’t relocating in large numbers; they’re reconsidering their work-life balance and care roles; they’re making localized switches among industries, or reshuffling , rather than exiting the labor market entirely; and, because of pandemic-related fears, they’re demonstrating a reluctance to return to in-person jobs.

By looking at how each of these factors has contributed to the Great Resignation, we can gain a helpful understanding of the forces that are shaping worker behavior today — and will do so for the foreseeable future.

Academic studies and online surveys alike have consistently found that the Great Resignation might better be thought of as the Great Retirement. In 2021, older workers left their jobs at an accelerated rate, and they did so at younger ages. They made these decisions out of a desire to spend more time with loved ones and to focus on priorities beyond work; they made their moves with confidence thanks to surging stock markets and buoyant residential property values; and a significant older cohort also left because of their greater susceptibility to serious Covid health risks.

This pattern is quite different from the last big crisis . During the Great Recession, between 2007 and 2009, there was a 1.0% increase in workforce participation among workers 55 years and older, whereas during the Great Resignation there was a 1.9% decline.

Stories about highly skilled knowledge workers abandoning the Bay Area in favor of scenic resorts in the Rockies make for interesting articles, but relocation has not played a material part in the Great Resignation. The overall movement rate in 2021 was the lowest on record for more than 70 years. Rates of relocation have been declining steadily since the 1980s, and Covid has not reversed that trend. Moreover, those people who did move disproportionately stayed local. Moving within one’s county of residence has remained the most frequent from of relocation; moving to a different state has remained the least frequent.

Reconsideration

Observers have suggested that the many deaths and instances of serious illness brought about by the pandemic have caused people to reconsider the role of work in their lives. That shift in perspective is likely to have motivated some workers to quit, especially those who were burning out in demanding jobs that intruded on their ability to care for their families. Women have been affected more than men, and younger age groups more than older ones.

Burnout has occurred notably among frontline workers, parents and caregivers, and organizational leaders. Turnover is a natural consequence. Because care obligations fall disproportionately on women, industries such as hospitality, where women comprise the majority for hourly workers, have seen larger numbers of quits. A 2021 Women in the Workplace report found that one in three women are considering leaving the workforce, switching jobs, or cutting work hours. This is often a forced choice — many women have no option other than leaving to meet caregiving obligations.

In white-collar industries, such as consulting and finance, junior personnel have also experienced notable levels of burnout. Such industries have had robust demand during the pandemic, obliging staff to work extremely hard without benefiting from the training, mentorship, and client interaction that previously made such jobs rewarding. Those experiences may have changed young workers’ tolerance for the demands of such workplaces.

Reshuffling

Bharat Ramamurti, the deputy director of the National Economic Council, recently coined the phrase the Great Upgrade to refer to the pattern of higher quit rates in lower-wage industries. Accommodation and food services and leisure and hospitality had the highest quit rates; retail trade and non-durable manufacturing experienced the greatest growth in their rates. Such spikes in turnover have not been limited to industries with a large percentage of low-wage workers. Professional and business services also registered a high quit rate and considerable growth in that rate.

But not all of these workers are leaving the labor market. There is evidence that many are “reshuffling” — that is, moving among different jobs in the same sector, or even between sectors. According to an analysis of BLS data conducted by the Economic Policy Institute in November of 2021, hiring rates are exceeding quit rates across many sectors, which suggests that high wage growth is attracting new applicants to open positions — and that many workers are both able and willing to accept jobs that are sufficiently attractive.

Having recognized this, some companies are taking action. An analysis by the Brookings Institution revealed that employers in industries with the highest quit rates have responded by raising wages sharply in an effort to rebuild their staffs. In 2021, McDonalds increased hourly wages for current employees by an average of 10% and raised entry-level wages between $11 and $17 an hour. The company also improved its benefits packages (including emergency childcare, paid time off, and tuition reimbursement). As a result, it successfully expanded its headcount in 2021, ending the year with higher staffing levels than it had at the beginning. At the same time, Walmart has announced a $1 billion Live Better U program, which during the next five years will pay 100% of the cost of college tuition and books for the company’s associates. That investment, the company hopes, will not only attract workers but improve retention.

Fear of contracting Covid in the workplace has made many workers reluctant to return to the office. In a recent Pew Research Center survey of 5,858 working adults, 64% of workers reported feeling uncomfortable returning to the office, and 57% reported choosing to work from home due to concern over exposure to Covid. Research reported in the Harvard Business Review indicates that many workers are prepared to quit if their employer does not offer a hybrid-work option: In a survey of over 10,000 Americans conducted in the summer of 2021, 36% of workers said that if not given a hybrid or remote option, they would search for an alternative, and 6% reported being willing to quit outright, even without a new position in hand.

The Great Resignation did not appear out of nowhere. Spurred on by the pandemic, it was a natural consequence of the five factors we’ve discussed in this article: retirement, relocation, reconsideration, reshuffling, and reluctance. Business leaders across sectors and industries will benefit from understanding which of these factors are contributing to turnover in their organizations, and from developing specific responses to stem that tide as Covid evolves from a pandemic to an endemic disease. As that happens, companies that have the vision and resources to offer flexibility to their employees are the most likely to maintain a stable and competitive workforce. And the companies best able to attract and retain talent will be those offering benefits that address the changing needs of workers. Similarly, companies that demonstrate a commitment to improving their employees long-term career prospects by offering training and tuition reimbursements will garner greater loyalty and gain in stature with prospective employees. The Great Resignation was no anomaly; the forces underlying it are here to stay.

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More From Forbes

New research on the real cause of the great resignation.

In April 2021, a record 4 million Americans quit their jobs. Fast-forward to September 2021, and 4.4 million quit in one month alone . Wow.

How did we get here?

Way back in 2020, resignation rates had fallen to the lowest levels in a decade. The pandemic had caused plenty of fear, uncertainty and doubt, companies had shut down, business had stalled, and people stayed put.

But as they hunkered down, workers began to reflect on their relationship with work. And as they did, they realized that certain aspects of work just didn’t work for them anymore. The traffic, the expensive parking or business wardrobe, the commute, the daily grind suddenly seemed excessive. The call to a higher quality of life—as we considered our mortality—was deafening. And then, the vaccination program entered the scene and gained momentum. By April 2021 the resignation trend had reversed, and it started to look like the beginnings of a hockey stick.

Thankfully, Zety recently conducted a survey of 900+ American workers to get to the bottom of this dilemma. Their findings are below, in infographics, because it’s time for us to unpack this.

2021 Study on The Great Resignation conducted by Zety

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Best covid-19 travel insurance plans.

The biggest causes might not surprise you, but let’s look at their impact:

There are currently around 154 million employed people in the US. So if we extrapolate Zety’s findings to the whole working population, then around 75.5 million people have quit their jobs in 2021 .

That’s roughly twice the entire population of Canada.

What can employers do to retain, attract, inspire their workers?

What made the grass greener?

What You Can Do

1. Create Flexibility and Autonomy – Let people work at times and in ways that work for them. Focus on getting results and trust your people to get them in the way that works for them. If your people are meeting their deadlines, delivering quality work that meets the specification, communicating and keeping you in the loop, and effectively planning so time is managed well, then all is well. There’s no need to micromanage how they work and when they do.

2. Create Growth Opportunities – Most people want to grow and evolve and see a path to both earning more and expanding their skill set. Help them, using Individual Development Plans and other similar tools. Make growth and advancement a key part of your culture, invest in your people, inspire them to stretch and become a bigger version of their awesome selves. Help them self-identify as leaders. Our leadership levels template will help you.

3. Create Meaning in Your Workplace – Now more than ever we all want to know our work matters. Help your team see how they contribute to the greater good, communicate how your firm is making a difference, help everyone volunteer or support inspiring non-profit organizations. Here’s one of my blogs on creating meaning .

4. Create a Sense of Tribe – Help everyone see how they belong together with a clear tribal identity . When we understand how to be safe, belong, matter together we feel trust, we feel tribe, we feel loyalty and yes, even devotion. Humans are emotional beings. Don’t miss this. It matters.

5. Create a Cultural GAME Plan – So all know how they will grow, be appreciated, be measured, and engage.

See our image below:

The Cultural GAME Plan: Create a Passionately Engaged Culture

The Net-Net

Yes, it’s a mess out there. But now you have a map to navigate it. And the great news is that by intentionally creating the 5 items above in your culture, you’ll have a more compelling workplace, and navigate far fewer resignations far more easily.

Home

The United States experienced the “Great Resignation” in 2021. In September 2021, 4.4 million American workers quit their jobs, which is the biggest employee resignation spike on record. The “Great Resignation” has made it essential for human resource (HR) managers to understand the changes and develop a new HR strategy that can stem the mass resignation of employees. This study argues that many of the pre-pandemic era’s HR policies and practices may not apply to the pandemic and post-pandemic periods and need to be adjusted. It discusses the causes and consequences of the “Great Resignation” and suggests innovative employee retention strategies that organizations can use to retain employees. Finally, the implications of this study and directions for future research are discussed.

Great Resignation , COVID-19 , Mass Resignation , Causes , Consequences , Employee Retention Strategies

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1. Introduction

Employee resignation and retention are two sides of the same coin. Employees’ resignations have an adverse effect on organizational effectiveness (e.g., Hom et al., 2017 ; Hom, Lee, Shaw, & Hausknecht, 2017 ; Huselid, 1995 ; Park & Shaw, 2013 ). Although employees’ resignation often negatively affects the firm’s productivity and competitiveness, it can sometimes be beneficial, specifically when “low-value” employees resign ( Judge & Kammeyer-Mueller, 2022 ; Tessema et al., 2017 ). However, the magnitude of employee resignations in the United States (U.S.) in 2021 was unprecedented. While Klotz called the phenomenon the “Great Resignation” ( Kaplan, 2021 ), Curtis termed it the “Big Quit” ( Curtis, 2021 ). U.S. employees have been voluntarily resigning from their jobs in droves, since early 2021, and the resignations reached the peak in September 2021, with 4.4 million American workers quitting their jobs ( U.S. Bureau of Labor Statistics, 2021 ). The “Great Resignation” remains somewhat mysterious in that there are labor shortages, although employment is much below its pre-pandemic level (5 million; Carucci, 2021 ).

The COVID-19 pandemic is the main factor that triggered mass resignations, which has had a profound effect on organizations and their workforce in the U.S. The year 2020 changed work altogether ( Agovino, 2021 ; Allman, 2021 ; Chamberlain, 2021 ). While millions of U.S. employees could not work in 2020 (due to compulsory lockdown), others had to work from home. For instance, the total separation in January and February 2020 was 5.7 million, but that number soared to an all-time high of 16.3 million in March 2020 ( U.S. Bureau of Labor Statistics, 2020 ). However, despite the introduction of COVID-19 vaccines, millions of U.S. employees were reluctant to return to their workplace for many reasons, such as comfort of working from home (working from home provides employees flexibility and convenience, and reduces their transportation cost and time) ( Maese & Saad, 2021 ; Maurer, 2021 ), fear of COVID-19 as the efficacy of the vaccines is not 100%, employees’ hesitancy of getting vaccinated, and the multiple job opportunities ( Geisler, 2021 ) provided by the current employee-driven market ( Allman, 2021 ; Krugman, 2021 ).

Generally, organizations expect a reasonable employee resignation rate. However, recently, the U.S. witnessed unprecedented resignations of employees who either left the workforce or switched jobs in droves ( Curtis, 2021 ; Kaplan, 2021 ; Molle & Allegra, 2021 ). Before the pandemic, the U.S. resignation rate never exceeded 2.4% of the total workforce per month ( Economic Policy Institute, 2021 ). However, in September 2021, it reached 3%, which was the largest spike on record ( U.S. Bureau of Labor Statistics, 2021 ). During the “Great Recession”, the employee resignation rate was 1.3%, down from 2.0 % ( Economic Policy Institute, 2021 ). These figures reveal that the U.S. recently faced a national mass exodus of employees. Recent surveys indicate that while 41% of employees were thinking about resigning from their jobs or changing professions in 2021 ( Microsoft, 2021 ), 65% were looking for a new job, and 88% of executives were experiencing higher resignations than normal ( PricewaterhouseCoopers, 2021 ). Moreover, the Gallup survey revealed that 48% of employees were actively looking to change their jobs ( Maese & Saad, 2021 ).

The pandemic and rise of remote work have changed the way employees view their lives and the world ( Kaplan, 2021 ; Krugman, 2021 ). The pandemic has allowed employees to re-evaluate their careers, specifically how it fits into their overall lives ( Geisler, 2021 ). One can argue that given the pandemic and the employee-driven labor market that has affected the way employees view jobs (jobs and lives), having effective retention strategies is a sine qua non to addressing the “Great Resignation”. Progressive human resource (HR) policies and practices that take employees’ demands, preferences, and well-being into consideration are needed. They are not a matter of choice but are required for organizations to succeed in the increasingly globalized and technology-driven world ( Molle & Allegra, 2021 ; Sammer, 2021 ; Tyler, 2021 ).

Many studies have been conducted on employees’ resignation-related issues (e.g., Hom et al., 2017 ; Huselid, 1995 ; Klotz & Bolino, 2016 ; Park & Shaw, 2013 ; Peterson, 2007 ; Postuma, Maertz, & Dworkin, 2007 ). However, there is a scarcity of systematic studies on the “Great Resignation”, which occurred in the U.S. in 2021. Therefore, this study intends to 1) investigate the causes of the “Great Resignation,” 2) identify and discuss its consequences , and 3) put forward creative and innovative retention strategies that can address the “Great Resignation” problem.

The rest of the paper is organized as follows. In section two, we review the literature on employee resignation, which also discusses the following resignation related issues: the causes and consequences of the “Great Resignation” and innovative employee retention strategies that organizations can use to retain employees. In section three, we draw the implications and present the conclusions of the study. Finally, in section four, we discuss the limitations and directions for future research.

2. Literature Review

Organizations aim to achieve certain goals. Accordingly, they must have the necessary human, financial, and physical resources to achieve their goals. Although these resources are needed to varying degrees in different organizations, human resources are believed to be the most critical resources that organizations need in order to achieve their goals ( Gerhart & Feng, 2021 ; Huselid, 1995 ). The way the modern workforce is managed (hired, trained, appraised, compensated, supervised, and treated) makes an impact on employee effectiveness and retention ( Gerhart & Feng, 2021 ; Gowan, 2022 ).

It has been argued that HR management is either part of the problem or part of the solution to gain productive contribution of people in an organization ( Lussier & Hendon, 2021 ). This study contends that the more effectively the employees are managed, the lower their intention to resign. In this study, an employee’s resignation refers to an employee-initiated employment termination. Employee resignation can be of two types: avoidable and unavoidable. While avoidable resignation is a type of resignation that can be prevented, unavoidable resignation (e.g., health, childcare, pregnancy, return to school, relocation, dual career, new career, and retirement) cannot be prevented. Although the resignation of less productive employees is desirable, it is detrimental to organizational success ( Judge & Kammeyer-Mueller, 2022 ; Harbert, 2021 ; Heavy et al., 2013 ). In this section, we reviewed the literature to identify the causes and the consequences of the “Great Resignation” and innovative employee retention strategies that organizations can use to retain employees.

2.1. The Causes of the “Great Resignation”

For an organization to develop effective retention strategies to mitigate the “Great Resignation,” it needs to know the root causes of the “Great Resignation.” Many factors have contributed to this phenomenon. In this study, we grouped the factors into three broad categories: the pandemic, current employee-driven labor market, and lack of effective organizational support for employees.

2.1.1. The COVID-19 Pandemic

The pandemic is one of the main factors that led to the “Great Resignation” ( Agovino, 2021 ; Allman, 2021 ; Geisler, 2021 ; McNeil, 2021 ). During the pandemic, employees felt sheltered and chose not to leave their jobs because of the uncertainty in their economic future. However, during the recovery from the pandemic in 2021, they felt empowered to resign and look for better opportunities. The “Great Resignation” was mainly the consequence of COVID-19 pandemic ( Agovino, 2021 ). Employees either left the workforce or searched for job opportunities that offered them more flexibility ( Taylor, 2020 ). Overall, the pandemic contributed to the “Great Resignation” for five reasons.

It gave employees more time to think about their careers : The pandemic gave American employees time and opportunities to reassess their situations and priorities ( Krugman, 2021 ; Maurer, 2021 ). The first year of the pandemic allowed employees to assess the extent to which their work was truly rewarding and look for a job they would love and help them earn more money ( Allman, 2021 ). The pandemic allowed the employees to think about their careers, explore entrepreneurship, and save more money (e.g., through reduced spending during the lockdown, federal stimulus checks, and suspension of student loan payments). Many employees realized that their jobs were not fulfilling ( Maurer, 2021 ). Therefore, when many employees decided to spend their time differently than they did before the pandemic ( Agovino, 2021 ), their thoughts on the risk of resignation were reshaped.

It created fear of being infected by the COVID- 19 virus : The pandemic has been devastating in several ways. Its contagious nature harms workplace safety and health ( CDC, 2021 ; Geisler, 2021 ). Consequently, organizations were forced to change their way of operation. When the number of COVID-19 related infections and deaths increased ( CDC, 2021 ), many employees began to fear COVID-19. The recent multiple infection outbreak waves and the Delta and Omicron variants have also contributed to employee fear. Many employees who were asked to return to the workplace opted to resign. Thus, the fear of COVID-19 is one of the many factors that influenced employees’ decisions to resign ( APA, 2021 ).

It contributed to employee stress : The pandemic increased the stress level of American employees in that most of them reported an uncertain economic future (81%) and the coronavirus pandemic (80%) as significant sources of stress in their lives ( APA, 2021 ). Many employees lost their colleagues due to death, sickness, and resignation during the pandemic. They lost their normal social interactions, which hurt their physical and mental health ( McNeil, 2021 ; Zielinski, 2020 ). Employees’ workloads and working hours increased due to shortage in the workforce. They were forced to wear masks and receive vaccines. Moreover, employees had a hard time receiving daycare services since child-care services were not functioning at full capacity ( Seth, 2021 ). Many workers have been unable to balance work and personal life, and had to be physically distant from their loved ones (e.g., friends, family, and coworkers). Thus, these factors sped up the rate at which employees became stressed, which had an impact on their intention to resign.

It led to the rise of hybrid and remote work : The pandemic forced employees to work from home, making many realize the benefit of remote work (e.g., home comfort, flexibility, reduction of transport cost and time, and work-life balance). Many employees are now accustomed to working from home ( Taylor, 2020 ). Under such circumstances, when asked to return to the workplace, they were reluctant and opted to resign. The pandemic led to the rise of hybrid and remote work, which encouraged many employees to resign when their demands for hybrid and remote work were not met.

It led to mandatory vaccination or weekly testing : Millions of American employees have been hesitant about COVID-19 vaccines for different reasons, including religious, political, and personal ( Agovino, 2021 ). The Biden administration recently directed the Occupational Safety and Health Administration (OSHA) to issue a temporary emergency standard requiring all private employers with at least 100 workers to require COVID-19 vaccination or undergo weekly testing ( CDC, 2021 ). Therefore, employees who saw the government’s vaccine mandate as a breach of their freedom to choose and a breach of their religious rights decided to resign rather than comply ( Hirsch, Cowley, & Scheiber, 2021 ). A recent SHRM survey revealed that 85% of the surveyed organizations anticipated that the Biden administration’s mandate for vaccination or testing would make retaining workers more difficult. However, 52% of the surveyed employees responded that they would likely quit their jobs if their organizations required them to be vaccinated as a condition of employment ( Maurer, 2021 ).

From the preceding discussion, we can conclude that COVID-19 and its ensuing lockdowns had an adverse impact on the American workforce. Although the work environment is constantly evolving, the pandemic has introduced several changes. It has made workers re-evaluate what they are getting out of their jobs and helped them choose the job they love ( Cook, 2021 ; Kaplan, 2021 ).

2.1.2. The Current Employee-Driven Labor Market

The current employee-driven labor market also contributed to the “Great Resignation”. The current tight labor market provides employees many job opportunities and lowers the cost of resignation. Many employees resigned knowing that they could obtain a better offer in terms of pay, benefits, flexibility, workplace safety, and supervision. When there are many open positions in the job market, people leave their current positions to search for better-paying ones with greater benefits and work-life balance ( Gowan, 2022 ; Phillips, 2022 ; Susik, 2021 ; Verhulst & DeCenzo, 2022 ). High resignation rates may indicate workers’ confidence of obtaining higher-paying jobs ( Grmaldi, 2021 ; Gowan, 2022 ) and low unemployment rates ( Phillips, 2022 ). For instance, approximately four million Americans quit their jobs in July, and by the end of the month, there were 10.9 million open jobs ( Cook, 2021 ). Owing to the increase in job openings and the opportunity for better compensation, employees now have more criteria for their job search than prior to the pandemic. Thus, the current tight labor market has increased both the scope and complexity of employee retention.

2.1.3. The Lack of Required Organizational Support for Employees

Previous studies have revealed that many employees have not been able to obtain the required support from their organizations ( Hirsch, 2021 ; Taylor, 2020 ), which leads to job dissatisfaction and resignation. For instance, many employees have not been able to achieve work-life balance ( Hirsch, 2021 ; Taylor, 2020 ), get effective employee assistance programs ( Zeidner, 2020 ), or participate in virtual socialization and social networks ( Sammer, 2021 ). In addition, employees do not receive services such as effective employee wellness programs ( Fournier, 2021 ; Zielinski, 2020 ), appropriate IT infrastructure and training while working at home ( Taylor, 2020 ), and proper supervision and treatment ( Tyler, 2021 ). Adequate personal protective equipment and a safe and healthy workplace ( Sheather & Slattery, 2021 ), enough paid leave ( Agovino, 2020 ), and the opportunity to voice their concerns and challenges ( Harbert, 2021 ) were other employee concerns.

The factors that trigger employee resignation can be grouped into two broad categories: push and pull. Push factors cause employees to resign (e.g., lack of flexible work arrangements [FWAs], unattractive pay and benefits, and lack of proper organizational support). In contrast, pull factors cause employees to join an organization that meets many of their demands and preferences (e.g., FWAs, attractive pay and benefits, and proper organizational support).

The primary question in this study concerns how organizations can identify the root cause of employee resignations and address them properly. A comprehensive review of the literature indicates that exit interviews, post-exit surveys, and employee job satisfaction surveys are methods organizations can use to understand the reasons for employee resignation ( Judge & Kammeyer-Mueller, 2022 ; Hirsch, 2021 ; Lussier & Hendon, 2021 ; Tyler, 2021 ). While exit interviews are formally planned, and discussions are conducted with departing employees, post-exit surveys are sent shortly after the employee’s last day of work ( Judge & Kammeyer-Mueller, 2022 ; Lussier & Hendon, 2021 ). In addition, job satisfaction surveys are conducted to understand the extent to which employees are satisfied/dissatisfied with different aspects of their jobs, which provides organizations with insights into employees’ job dissatisfaction levels and intention to resign ( Hirsch, 2021 ; Tyler, 2021 ).

2.2. Consequences of Employees’ Resignation

Employees’ resignations harm organizational effectiveness (e.g., Heavy et al., 2013 ; Hom et al., 2017 ; Klotz & Bolino, 2016 ; Park & Shaw, 2013 ). This is due to the costs associated with employee resignation, which can be grouped into three main categories: separation, replacement, and training costs ( Judge & Kammeyer-Mueller, 2022 ; Heavy et al., 2013 ; Hinkin & Tracey, 2000 ; Tyler, 2021 ). Employee separation costs refer to costs incurred when an employee resigns, and includes costs such as temporary coverage (e.g., overtime pay for exiting employees and temporary employees) and HR professional time (payroll, benefits, and exit interview). In addition, employee resignations can trigger other employees to resign and be hired by a competitor, lead to production and customer service delays, or decrease the quality of goods and services. Employee r eplacement/hiring costs refer to the costs incurred to replace a resigned employee, and may include hiring costs (e.g., advertising the job opening, time and cost of reviewing resumes, recruiting software costs, interview costs, drug testing, background checks, pre-employment assessment tests, onboarding (such as orientation program time and materials), and induction costs (such as payroll and benefits enrollment). Employee training costs refer to the costs incurred to train newly hired employees, and may include on-the-job training (e.g., supervisor and employee time), off-the-job training (e.g., trainee and instruction time, materials, and equipment), productivity loss (e.g., loss of production until becoming fully productive), and mentoring (e.g., mentor’s time) ( Clark, 2014 ; Judge & Kammeyer-Mueller, 2022 ; Susik, 2021 ; Peterson, 2007 ; Tyler, 2021 ).

These costs of resignation can also be grouped into two broad categories: financial and non-financial costs. Financial costs may include costs of time people spend, costs of materials and tools, and productivity losses. Non-financial costs include having a negative effect on workforce morale, lower customer satisfaction, loss of clients, and reduced efficiency ( Judge & Kammeyer-Mueller, 2022 ; Hinkin & Tracey, 2000 ). Moreover, mass employee resignation creates a burden on HR and line managers as they would have to constantly hire and train new employees ( Fox, 2014 ; Heavy et al., 2013 ; Tyler, 2021 ). Thus, an employee’s resignation is expensive, and organizations should try their best to reduce the number of employee resignations using the different retention strategies discussed below.

2.3. Strategies for Minimizing Employees’ Resignation

One of the main reasons employees resign is job dissatisfaction ( Fox, 2014 ; Hirsch, 2021 ), which is influenced by several HR policies and practices. When organizations have effective HR policies and practices, their employees are more likely to have higher job satisfaction, reducing their intention to resign. Progressive HR approaches offer strong competitive advantages, and without them, organizations could be at an extreme disadvantage in minimizing mass resignation. This study contends that having progressive HR approaches that evolve from “nice-to-have” to “must-have” are essential for organizations to survive, compete, and win in the globalized world. Prior studies have shown that organizations that overcome employee turnover-related challenges emerge more strongly ( Taylor, 2020 ).

This study uses employee value proposition (EVP) as the basis for creating retention strategies that address the “Great Resignation” challenge faced by American organizations. EVP is the totality of rewards that an employee receives in return for knowledge, skills, ability, and other characteristics (KSAOs) that they bring to an organization ( Ledford & Lucy, 2003 ). It sets a monetary and non-monetary reward for employees who respond positively ( Allman, 2021 ; Judge & Kammeyer-Mueller, 2022 ). It has been underscored that for EVP to be effective, it should not be of the wrong magnitude (either too small or too great) or wrong mix (out of sync with the employees’ preferences). Further, it should also be distinctive enough (special appeal to win the hearts and minds of employees). Although designing EVP that employees appreciate is costly, its benefits (in terms of attraction, performance, and retention) outweigh the costs ( Geisler, 2021 ; Kazi & Hastwell, 2021 ; Tyler, 2021 ). Although designing an effective EVP is often a challenge for organizations, the results can have significant implications for employee retention and employee resignation ( Judge & Kammeyer-Mueller, 2022 ). Hence, when an organization fails to design an effective EVP, its retention power diminishes ( Huselid, 1995 ; Ledford & Lucy, 2003 ). Although many factors affect employee resignation, the following three retention strategies can play a significant role in reducing employee resignation during the pandemic and beyond: FWAs, attractive compensation (pay, benefits, and incentives), and proper employee support.

2.3.1. Providing Flexible Work Arrangements (FWAs)

The pandemic has changed how we work and our perspective of the traditional (rigid) work schedule, which is 9-to-5 a day, 40 hours a week, and 5 days a week ( Chamberlain, 2021 ; Zielinski, 2021 ). After the pandemic, most organizations voluntarily or mandatorily allowed their employees to work remotely, and the employees became accustomed to this work format and appreciated the benefits of FWAs. Although many employees always prefer FWAs, the pandemic has increased their desire to have even more flexibility in their work lives. In this technology-driven increasingly globalized market, where it is possible to work from practically anywhere any time, FWAs are becoming the “new normal” ( Krugman, 2021 ; Maurer, 2021 ; Zielinski, 2020 ). Consequently, it will be difficult for organizations to bring back the life that was prevalent in the workplace before the pandemic ( Ward, 2021 ; Seth, 2021 ).

Many studies have reported that it has become easier to work remotely and stay in touch with the development of communication tools, such as the Internet, digitalization, and cloud storage ( Maurer, 2021 ). When organizations provide their employees with options regarding how and when to work (e.g., working in-person, from home, hybrid, compressed workweeks, and flexible schedules), employees’ intention to resign is likely to diminish ( Kalita, 2021 ; Microsoft, 2021 ). Studies have shown that many organizations that have FWAs meet reasonable standards for productivity, quality, and service ( Kazi & Hastwell, 2021 ; Microsoft, 2021 ). Hence, the availability of FWAs is critical for organizations to minimize employee resignations.

While only 5% American employees worked from home before the pandemic, this number increased to over 60% in May 2020 ( Kazi & Hastwell, 2021 ). Similarly, Fortune 500 executives who worked from home increased from 16% to 65% ( Kazi & Hastwell, 2021 ). Although remote work declined from 82% in October 2020 to 72% in February 2021, many employees continue work remotely to some degree ( Maese & Saad, 2021 ). Furthermore, by September 2021, about 45% of American employees worked from home to some degree ( Saad & Wigert, 2021 ). About 91% of American employees who worked remotely for at least some hours hoped to continue their remote work after the pandemic ( Saad & Wigert, 2021 ). In addition, while 54% of the remotely working employees would like to have a hybrid arrangement, splitting their time between working at home and in the office, 37% would like to work from home entirely, and 9% would prefer to return to the office full time ( Saad & Wigert, 2021 ). 76% of remotely working employees also expect their organization to allow them to work remotely in the future as well, and 61% of them expect to work in a hybrid manner for at least the year 2022 ( Saad & Wigert, 2021 ). Approximately 30% of employees working remotely will likely resign if their organization removes the remote work option ( Saad & Wigert, 2021 ). While 73% of employees want flexible remote work options to stay, 66% of managers reported that their organization is planning to redesign office spaces for hybrid work ( Microsoft, 2021 ). A recent SHRM survey revealed that if given the option, about 52% of American workers would choose to work from home permanently on a full-time basis ( Maurer, 2021 ). About 45% of American employees are still working from home to some degree, and most of them do not want to return to the office full-time ( Maurer, 2021 ).

These surveys also indicate that the most preferred FWA is a hybrid approach that allows employees to work partly from home and partly in-person ( Chamberlain, 2021 ; Kalita, 2021 ; Microsoft, 2021 ). The figures may also suggest the need for organizations to evaluate employees’ desires and preferences regarding FWAs and attempt to accommodate their desires in general and of those who are “high-value” employees in particular. Organizations may need to have more flexibility in their HR policies and working arrangements ( Sammer, 2021 ; Tyler, 2021 ).

Employees have many reasons for preferring FWA, including flexibility to balance work and personal obligations, not commuting frequently, improved well-being, comfort from working from home, convenience, and reduced employee transportation costs and time ( Agovino, 2021 ; Kazi & Hastwell, 2021 ; Maurer, 2021 ; Seth, 2021 ). Prior studies indicated that when employees are given flexible work schedules, they are more likely to be more productive, healthier, happier, and less stressed ( Maurer, 2021 ; Seth, 2021 ). This may subsequently lower their intention to resign.

2.3.2. Providing Attractive Compensation (Pay, Benefits, and Incentives)

The types of compensation (pay, benefits, and incentives) that employees receive have a far-reaching impact on their intention to resign ( Gowan, 2022 ; Grmaldi, 2021 ; Phillips, 2022 ; Sammer, 2021 ; Susik, 2021 ; Verhulst & DeCenzo, 2022 ). Knowing the size and type of pay, benefits, and incentives demanded by employees and providing competitive compensation can play a critical role in reducing employees’ decisions to resign. The size and variety of employee compensation can be determined by conducting surveys inside and outside organizations ( Maurer, 2021 ; Susik, 2021 ). Using public resources, organizations can compare their pay scales with similar organizations. Previous studies show that one factor that increases employees’ resignation is an organization’s failure to offer attractive pay and benefits ( Grmaldi, 2021 ).

It has also been argued that organizations should attempt to prevent “high-valued” employees from resigning ( Berman-Gorvive, 2014 ; Clark, 2014 ; Hausknecht, Rodda, & Howard, 2009 ). When highly valued or difficult-to-replace employees receive an outside job offer, it would be beneficial for organizations to make a counteroffer that matches or exceeds the outside job offer ( Berman-Gorvive, 2014 ; Lussier & Hendon, 2021 ). Organizations should also develop special retention strategies for “high-value” employees in addition to other retention strategies ( Hausknecht et al., 2009 ; Lytle, 2020 ).

Employees pay attention to benefits when they resign or accept an outside job offer. Hence, organizations need to offer attractive benefits and create avenues for future employee growth ( Gowan, 2022 ; Lussier & Hendon, 2021 ; Phillips, 2022 ). For instance, 60% of people reported that benefits are a major factor in deciding whether to accept a job offer ( Glassdoor, 2015 ). Hence, attractive employee benefits can provide organizations with a competitive advantage in attracting and retaining desirable employees ( Geisler 2021 ; Maurer, 2021 ; Susik, 2021 ). In addition, incentives, or bonuses such as end-of-year bonuses, which are types of payments provided on an annual basis as a sign of appreciation, and retention bonuses, which are types of payments determined based on an employee’s length of service, can help improve the retention rate ( Carucci, 2021 ).

2.3.3. Providing Proper Employee Support

When employees receive the support they need from their organization, their intention to resign may diminish ( Allman, 2021 ; Cook, 2021 ; Heavy et al., 2013 ; Sheather & Slattery, 2021 ). The support employees receive from their organizations can help them have a sense of purpose ( Carucci, 2021 ). The following are examples of organizational support that can be provided to employees.

Supporting employees to balance work and personal lives : Helping employees integrate their work and private lives improves job satisfaction ( Maurer, 2021 ; Hirsch, 2021 ), which can subsequently diminish their intention to resign. This is because employees want to balance their work with their personal lives. When employees cannot balance work and life, their job dissatisfaction, stress, and desire to resign increase ( Ladika, 2020 ; Seth, 2021 ). Although the issue of work-life balance has received some attention in the past decade, the pandemic has increased its importance. Thus, organizations need to align their HR policies accordingly. One way to help employees balance work and personal lives is to provide FWAs ( Maurer, 2021 ; Zielinski, 2020 ). Work-life balance programs can allow employees to take time off from work if needed, create flexible scheduling options, and provide opportunities to work from remote locations ( Tyler, 2021 ).

Supporting employees to obtain effective EAPs : EAPs are programs designed to help employees with personal problems such as mental and emotional health concerns, substance abuse, financial and legal issues, and family relationships ( Verhulst & DeCenzo, 2022: p. 355 ). This is done by providing them with confidential counseling ( Sammer, 2021 ) and referral services for different employees’ issues ( McNeil, 2021 ). Many organizations provide EAPs to employees with emotional, physical, or other health problems. Many studies have revealed that the pandemic has had an adverse impact on employees’ health and well-being. Providing effective EAP programs can help minimize employees’ problems and improve their loyalty and commitment to the organization ( Maurer, 2021 ; Zielinski, 2020 ). Organizations need to offer employee counseling and therapy sessions during scheduled work times by hiring therapist(s) or referring them to agencies that provide EAPs.

Supporting employees to have virtual socialization and social networks : After the pandemic, employees have not interacted and socialized in person. Not having social interactions takes a toll on employees’ mental health, and the lack of human interaction makes it difficult to battle internal demons associated with mental health. Providing employees with an opportunity to interact and socialize virtually can improve their job satisfaction ( Sammer, 2021 ), which can help minimize employees’ intention to resign ( McNeil, 2021 ). Organizations must encourage virtual social interaction (e.g., pre/post-meeting chats, virtual parties, and non-business communication) so that remote workers do not feel isolated. Such an opportunity can also help employees bond with their colleagues and stay connected ( Ladika, 2020 ; Zeidner, 2020 ; Zielinski, 2020 ).

Supporting employees to obtain effective employee wellness programs : Wellness programs are often designed to keep employees physically and mentally healthy ( Verhulst & DeCenzo, 2022: p. 355 ). These are important programs that help employees improve their physical, mental, and emotional well-being ( Fournier, 2021 ; Sammer, 2021 ). It is also good to help employees bond and stay connected by inviting them to participate in wellness programs that focus on physical, mental, and emotional well-being ( Ladika, 2020 ; McNeil, 2021 ).

Supporting employees to obtain the appropriate IT infrastructure and training if they are to work from home : As the number of employees working from home has increased, the need to help employees obtain the appropriate technology has also increased ( Sammer, 2021 ; Zielinski, 2021 ). When remotely working employees receive the required technical support (e.g., email, dedicated work phones, instant messaging systems, and virtual office spaces) to accomplish their tasks, their job satisfaction increases, diminishing their intention to quit. Organizations need to ensure that any remote work is not hindered by a lack of appropriate technology or technological understanding ( Maurer, 2021 ; Zielinski, 2021 ), which also requires organizations to allocate sufficient funds to the purchase upkeep, support, and train employees. Organizations should also revise their IT policies ( Sammer, 2021 ).

Supporting employees to improve their awareness of the COVID- 19 pandemic : Millions of Americans lack awareness of COVID-19 and put more trust in social media channels than in the scientific community and government agencies ( Alonso, 2021 ; Chamberlain, 2021 ). Many employees have made false assumptions about the pandemic and the vaccine. Hence, organizations need to help their employees improve their awareness of the pandemic and vaccines by providing reliable and objective information. Organizations can invite experts to share their advice regarding the pandemic and vaccine and create open invitation internal town-hall-style meetings, where people can openly discuss their concerns or ask questions.

Supporting employees to receive proper treatment and supervision : Organizations need to consider their employees as customers. Organizations need to believe that their employees are the most critical resources that provide a competitive advantage ( Gerhart & Feng, 2021 ) and put their employees first (create a more “employee first” environment). In the words of Vineet Neyar (as quoted by Burkus, 2017: p. 33 ), “profits are driven by customer loyalty, customer loyalty is driven by employee job satisfaction, and employee job satisfaction is driven by putting employees first.” This may suggest that organizations must treat their employees with respect and dignity ( Hirsch, 2021 ; Postuma et al., 2007 ). Caring for employees’ well-being has a significant effect on their intention to quit ( Sheather & Slattery, 2021 ).

Supporting employees to have a safe and healthy workplace : If employees are to be safe and healthy, they must be provided with a safe and healthy workplace. Recently, one of the factors that triggered employees’ resignation was fear of COVID-19 ( Agovino, 2021 ; Geisler, 2021 ; Sheather & Slattery, 2021 ; Zeidner, 2020 ). Organizations must ensure that the Center for Disease Control (CDC) guidelines and Occupation Safety and Health Administration (OSHA) requirements related to COVID-19 are met. They also need creative and innovative ways to meet these requirements. Hence, one initiative that can minimize employee resignation is to provide a safe and healthy workplace.

Supporting employees to voice their concerns : Assisting employees to voice their concerns, opinions, and challenges can help them feel happy and have a sense of belongingness ( Tyler, 2021 ; Zeidner, 2020 ), achievable when the organization has transparent and effective communication systems ( Lytle, 2020 ). The HR team can also play a key role in supporting employees in voicing their concerns ( Harbert, 2021 ). Providing employees with the opportunity to participate in decision-making, which affects their well-being, can also help enhance their loyalty and commitment to the organization ( Carucci, 2021 ).

Supporting employees to get enough paid leave : The pandemic has increased employees’ challenges due to COVID isolation and quarantine of family members, mental and physical health problems, school lockdown, homeschooling, lack of daycare services, and inability to maintain work-life balance ( Carucci, 2021 ; Zielinski, 2020 ). Hence, organizations need to support employees by providing them with more paid leave ( Agovino, 2020 ; Ladika, 2020 ). To do so, they need to change their leave policy.

3. Implications and Conclusions of the Study

Although the workforce is an organization’s greatest asset and can make or break its success ( Gerhart & Feng, 2021 ), they have been resigning from their jobs at a disturbingly high number in 2021. Since the pandemic began approximately two years ago, it has caused uncertainty and rapid changes in the workplace. The US has seen a record job loss (in March 2020) to an unprecedented mass migration to remote work (after March 2020) and then to “the Great Resignation” (mid-to-late-2021), which may suggest that the pandemic has upset the natural work order. The pandemic has changed the perception of rigid, traditional work schedules. It also has a profound effect on how employees work and view the traditional work environment and why they work. Organizations will never return to their pre-pandemic work situation. Organizations have two options in this “new, normal” situation: adapting or getting left behind. Organizations can compete and win during the pandemic and beyond by understanding who is resigning, why they are resigning, and properly accommodating and responding to the employee’s demands.

To minimize “the Great Resignation”, organizations need to identify the root causes of employee resignations and develop highly customized retention strategies. To develop highly customized retention strategies, organizations must create effective EVPs of the right magnitude, mix, and distinctiveness ( Judge & Kammeyer-Mueller, 2022 ). This can be done by gathering information on employees’ preferences regarding different terms and conditions of employment. When an organization creates effective EVPs, it is better positioned to develop effective retention strategies.

This study identified the following three causes of “the Great Resignation”: the pandemic, current employee-driven labor market, and lack of effective organizational support for employees. This suggests that organizations apply the following three retention strategies, which can be effectively weather the negative effects of “the Great Resignation”. They are providing flexible work arrangements, attractive compensation (pay, benefits, and incentives), and proper support to employees. In implementing the suggested strategies, organizations need to assess both the costs and benefits of each strategy and give due attention to how many employees to retain and what kind of employees to retain. Some employees (“high-valued” employees) are worth more than others in their contributions to their organization ( Krugman, 2021 ; Phillips, 2022 ), and extra efforts must be made to prevent them from resigning ( Hausknecht et al., 2009 ).

This study does not suggest that one size fits all but rather brings some important issues to the attention of organizations and tailors the suggested strategies to their unique work environments. The suggested retention strategies can be used to identify the problem areas in which organizational actions should be directed.

If an organization has FWAs, it must have an accurate assessment, implementation, and management of FWA programs. Suppose FWAs are to provide the desired outcomes. In that case, an organization should perform at least the following five activities: 1) assessing the needs of the employee, team, and the organization by conducting a survey; 2) defining FWAs and what they mean for the organization; 3) establishing methods to keep employees connected by providing the right tools and processes; 4) focusing on the outcome to reward employees for an outcome, not output; and 5) monitoring and evaluating the effectiveness of the FWA programs.

Many current HR policies and practices lack relevance to pandemic-induced workplace changes and need to be adjusted and updated accordingly. Many components of the traditional or conventional approaches to managing employees, which were deemed effective before the pandemic, may not be effective during the pandemic or post-pandemic era. Organizations need to think outside the box and capture their employees’ hearts and minds. It has been underscored that organizations need to adjust, adapt, and change rapidly to stay relevant in a sea of uncertainty ( Harbert, 2021 ; Tyler, 2021 ). Organizations must learn to adapt to address employees’ resignations in this new strong labor market while functioning well. The pandemic has increased employee demand (employee-driven market), and organizations that fail to meet employees’ demands are at risk. The suggested retention strategies also require rebuilding corporate culture ( Carucci, 2021 ). This is because organizations that could transform their corporate culture and accommodate the demand of their workforce can weather the storm and minimize mass resignation. Thus, managers must be creative and innovative in the way they retain their employees now more than ever before.

This study argues that a single, isolated retention strategy may not effectively minimize employees’ resignations. However, combining the suggested retention strategies, which worked together, can profoundly impact minimizing employee resignations ( Judge & Kammeyer-Mueller, 2022 ; Sammer, 2021 ). Our argument aligns with Gerhart and Feng’s (2021) idea that HR practices either work together as a package or fight against each other. Different retention strategies can work well together in the same organizational setting, while a mix of bits from each strategy can fall flat ( Gowan, 2022 ). HR strategies must be integrated into a comprehensive system if organizations are to minimize employees’ resignations. The most effective tool for minimizing employee resignations is to provide integrated systems that involve careful selection (hiring employees who are less likely to resign), providing proper and adequate training, and FWAs (responding to employees’ preferences for FWAs). In addition, it should provide competitive compensation (pay, benefits, and incentives).

As previously discussed, although there are challenges in providing FWAs (e.g., difficulty in collaboration, isolation, lack of interaction, supervision problems, feelings of preferential treatment among employees, and managing client relationships), their benefits (e.g., improved recruitment and retention, enhanced employee morale and engagement, better balanced work-life, a greater sense of feeling valued, and better health) exceed. While the suggested retention strategies play an important role in minimizing employees’ resignations, they should not be perceived as a panacea to American organizations’ challenges. They cannot guarantee the elimination of employees’ resignation problems, as there are unavoidable resignations, yet failure to implement them may aggravate the prevailing employee retention problem. It also underscored that the suggested strategies are not without cost, but their benefits outweigh their costs ( Geisler, 2021 ; Kazi & Hastwell, 2021 ).

The question is how to put the suggested retention strategies into effect. One way to implement the suggested retention strategies is through an approach with two components: integration and eradication. Eradication refers to eliminating some of the traditional HR practices (e.g., rigid work schedules and strict leave policies) that may impede organizational efforts to retain employees for an extended period effectively. In contrast, integration refers to assimilating new HR practices (e.g., providing FWAs and leave policies that respond to pandemic challenges) that enhance employee retention. Organizations need to determine what is conducive to implementing the suggested retention initiatives and what represents a threat to such an endeavor in their unique work setting. They need to see what works and what does not work rather than attempting to complete a change in existing retention strategies.

4. Limitations of the Study and Directions for Future Research

This study adds to the existing literature on “the Great Resignation”. It augments previous research on employees’ resignation and retention in general and “the Great Resignation”. It is a timely, relevant, and critical organizational issue. This study has merit because, unlike most previous studies, it discussed the causes and consequences of “the Great Resignation” and the strategies for improving employee retention. One of the main limitations of the current study is that it focuses on “the Great Resignation”, which has occurred in the American workplace. Therefore, the findings of this study may not be generalizable. Therefore, future research should investigate the causes and consequences of employee resignation in other parts of the world. In addition, investigating the causes and consequences of “the Great Resignation” at the organizational level (case study) can give more in-depth information or can help in improving our understanding of the causes and consequences of “the Great Resignation” at the organizational level.

Conflicts of Interest

The authors declare no conflicts of interest regarding the publication of this paper.

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Who Is Driving the Great Resignation? - Harvard Business Review
1. Resignation rates are highest among mid-career employees. Employees between 30 and 45 years old have had the greatest increase in resignation rates, with an average increase of more than 20%...
The Great Resignation: Why workers say ... - Pew Research Center
Majorities of workers who quit a job in 2021 say low pay (63%), no opportunities for advancement (63%) and feeling disrespected at work (57%) were reasons why they quit, according to the Feb. 7-13 survey. At least a third say each of these were major reasons why they left.
How companies can turn the Great Resignation into the Great ...
To stem the tide of the Great Attrition (or what many call the Great Resignation), senior executives must understand why employees are leaving. Many are struggling to do so. For example, when employers were asked why their people had quit, they cited compensation, work–life balance, and poor physical and emotional health.
The “Great Resignation” in perspective - Bureau of Labor ...
This recent phenomenon has been called the “Great Resignation.” While extrapolations using historical quit-rate data for manufacturing suggest that the U.S. economy exhibited even higher quit rates in the 1960s and 1970s, the recent quit rates are too high to be explained solely by labor market tightening.
Toxic Culture Is Driving the Great Resignation
The Great Resignation is affecting blue-collar and white-collar sectors with equal force. Some of the hardest hit industries — apparel retail, fast food, and specialty retail — employ the highest percentage of blue-collar workers among all industries we studied.
The Great Resignation Didn’t Start with the Pandemic
Academic studies and online surveys alike have consistently found that the Great Resignation might better be thought of as the Great Retirement. In 2021, older workers left their jobs at an...
New Research on The Real Cause Of The Great Resignation - Forbes
Way back in 2020, resignation rates had fallen to the lowest levels in a decade. The pandemic had caused plenty of fear, uncertainty and doubt, companies had shut down, business had stalled, and...
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The Great Resignation has created numerous knowledge-related impacts at the organizational level; for example, knowledge loss, reduced business process efficiency, damaged intra-organizational...
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The “Great Resignation” has made it essential for human resource (HR) managers to understand the changes and develop a new HR strategy that can stem the mass resignation of employees. This study argues that many of the pre-pandemic era’s HR policies and practices may not apply to the pandemic and post-pandemic periods and need to be adjusted.