The nature of work always includes people resigning from their jobs and disrupting business operations as they look for ways to fill substantial gaps. Companies want to avoid that situation, dedicating funds and resources to lower attrition rates and figuring out how to deal with employee resignation. Unfortunately, most businesses continue to struggle. It begs the question: where can companies turn to in this situation?
Recent reports reveal that a rising number of employees from the United States quit voluntarily in the past year. McKinsey & Company finds that in the US alone, there are over 11.3 million open jobs at the start of April 2022. The number of vacant posts increased significantly from last year, a time dubbed as the Great Resignation. However, the phenomenon is not limited to the US, as other business-developed countries like Australia, Singapore, Canada, the United Kingdom, and India are also seeing a massive wave of workers resigning from their posts. The trend continues to alarm businesses working hard to keep attrition rates low through retention strategies. However, those efforts no longer have the same effect. Companies must brace for impact as employee resignations pile up, but where do they start?
Why are Employees Resigning?
To reiterate, employees resigning is a natural occurrence. Businesses already have recruitment strategies, allowing them to fill in the gaps left behind as they try to solidify strategies on how to deal with employee resignation. However, the business landscape is always fast-paced, and any disruptions could cause businesses to lose money. As a result, retention strategies are present, aiming to lower attrition rates.
Attrition rates are metrics companies use to measure how many employees leave over a certain period. Many companies aim to keep attrition rates low because business disruptions are more challenging and costly when more employees leave. There are many types of attrition, with employees getting dismissed or laid off being the most significant in the past decade until the Covid-19 pandemic. However, the recent rise in voluntary attrition over the past 12 months sounded a disturbing alarm for businesses, which have to get to the bottom of this to prevent operational disruptions amid what are already trying times for the US and global economies.
A recent survey gathered the most common reasons for resignations during the past year, with over 13,000 employees from different countries, including the US, taking part. The results are as follows:
The survey results above show that the classics behind voluntary attrition still remain. People still see lack of career development or advancement and inadequate pay as reasons for resignations. However, the arrival of remote opportunities, the dominance of younger generations among the general workforce, and the increasing spotlight on mental health awareness amid the pandemic era shifted how employees perceive work. Obviously, the problems on how to deal with employee resignation continue to pile on for businesses.
A third of the respondents believe competent and empathetic leaders are a must in the workspace, given that they left because of uncaring or uninspiring leadership or management. A quarter of employees also resigned from their posts to seek career opportunities with better workplace flexibility. This is likely due to the fact that businesses are asking employees to return to the office despite knowing that the remote work environment is achievable during the pandemic.
Moreover, respondents consider unsustainable work expectations, unreliable and unsupportive colleagues, and lack of health and well-being to support valid reasons for resigning. Those signals solidify the changing shift in mental health awareness in the current workplace as professionals from younger generations start to dominate the global labor market.
However, those resignation factors are far from the most interesting takeaway from the resignation trend during the past year. The recent year’s more significant and controversial trend reveals that not only do employees leave their jobs for different employers, but they are also switching to different industries. This situation puts another challenging aspect on not knowing how to deal with employee resignation.
Respondents from six different countries desire to find better-paying, more passion-inclined, and stable jobs, even if they have to switch industries to do it. Forty-eight percent of those who resigned decided to take their talents to new sectors, mainly those suited for the remote work lifestyle people grew accustomed to during the pandemic. Meanwhile, 17% agreed to go to life’s demands, choosing early retirement to take care of children, elderly loved ones, or themselves over returning to the workforce. Unfortunately, it resulted in the available talent pool dramatically shrinking.
There are also a few employees leaving their traditional full-time jobs for nontraditional work, either working as freelancers, consultants, or part-time opportunities. Others also started their own businesses, especially since they had the time to explore entrepreneurship options while unemployed or working from home.
These factors explain why the percentage of employees quitting their jobs has risen over the past year. It not only changes a company’s approach on how to deal with employee resignation, but also hiring tactics, work arrangements and setups, and business operations as a whole.
What Should Businesses Do about Employees Quitting?
Businesses in the countries where the respondents originate are scrambling to fill the gaps left behind by resigning employees. While inflation forces people back into the workforce, it is not enough to help create a sustainable system for hiring people for open slots. Even with the help of automation and increased immigration, most businesses will still find filling job openings in crucial and non-flexible positions challenging.
Hiring becomes necessary when filling open roles, but it means reshuffling resources for recruitment, onboarding, and training. With labor costs already among the highest business expenses, it can be wasteful when you hire an employee, only for the applicant to back out or resign after a few months. Talent-sourcing approaches will also vary, especially when adjusting offers and benefits to attract the new wave of workers who value workplace flexibility, quality leadership, and focus on health and well-being. All signs point toward dedicated expenditures to recruiting people for those jobs despite inflation rising to alarming levels. Fortunately, staffing also comes in the form of solutions, one that third-party vendors can provide.
Where Does Offshoring Factor in Business Solutions?
The COVID-19 pandemic forced companies to lay off a significant part of their workforce to keep their business afloat. This means they are experienced with having to scramble and fill up large gaps as they aim to achieve growth and recovery. Because it is a widespread problem for most companies worldwide, effective solutions spread like healthy wildfire. Chief among them is offshoring solutions.
The promise of cost-efficient staffing solutions, support services, and operational development in a strategical geographic location in a country with a low-cost economy is an attractive approach even before the resignation trend and the pandemic. Moreover, the countries in the report, with the exception of India, are not known to have a massive labor market.
To succeed with incorporating offshoring solutions and prevent attrition rates from creating operational disruptions and higher costs, companies must select the right partners. China, one of India’s top rivals in supplying offshore teams to foreign clients, is also suffering from a historic economic collapse. Fortunately, the Philippines, one of the world’s best business process outsourcing (BPO) countries, is also proving its position for offshoring business services.
The Philippines currently ranks 9th among the 20 leading countries in offshore business services worldwide. However, its financial attractiveness is only second to India by a slim margin, making the country a perfect destination for companies in need of cost-effective staffing solutions. Of course, businesses must ensure they partner with an offshoring firm capable of filling in-demand roles efficiently, and this situation is where an established company like iSupport Worldwide prevails.
Why Partner with iSupport Worldwide to Fill Employment Gaps?
iSupport Worldwide is a US-owned offshoring company with over 15 years of experience, providing over a thousand roles for over a hundred clients currently. The firm’s primary function is to help foreign businesses maintain cost-efficiency with their operations, which it continues to fulfill.
However, recent successes, including its inclusion in the Inc. 5000’s List of Fastest-Growing Companies in 2021, allowed it to undergo a brand metamorphosis that helps both the Philippine workforce and its clients. The evolution allowed iSupport Worldwide to become one of the leading offshoring companies capable of finding in-demand and rare talents on top of the most common outsourced jobs for various industries. The newly formed specialty makes iSupport Worldwide a perfect partner for foreign businesses looking to sustain operations with cost-efficient staffing solutions but also removes the challenging aspects of how to deal with employee resignations.
If you need high-quality offshoring solutions, you can fill up this form to get started with your long-term employment needs. Creating your high-powered offshore team can happen as fast as 30 days! If you need to get into more details with your needs, you can contact our VP for Sales, Sandy Mertz-Brady, and book a discovery call or reach out on our socials: