PS_1105 Great Resignation | Courtesy Pikes Peak Workforce Center 2 copy 2.jpg

A job seeker checks in with a potential employer at a job fair hosted by the Pikes Peak Workforce Center.

Workers throughout the United States quit their jobs at record rates this year.

According to data analytics firm Visier, the labor market has seen a 25 percent annualized resignation rate in 2021. That means 1 in 4 workers quit this year.

In July alone, 4 million people left their employment.

The leveling off of unemployment benefits has not stemmed the tide that economists are calling the Great Resignation or the Big Quit, but data analysis is starting to show some trends that could help employers cope with workforce leakage.

According to an undated blog post on Visier.com

• It isn’t just food service and other lower-wage employees who are quitting. Resignations are happening across all industries.

• In the year to date through August, mid-tenured employees — those who have been on the job 5-10 years — resigned at a rate 56.8 percent higher than during the same period of 2020. For those with 10-15 years at their jobs, the resignation rate was 54.6 percent higher.

• Women are resigning at higher rates than men — 55.4 percent, compared with 47.2 percent for men. That trend predated the pandemic but increased during the first eight months of 2021.

In a September 2021 article in the Harvard Business Review titled “Who Is Driving the Great Resignation?”  Visier’s VP for People Analytics Ian Cook wrote that some of the increase in resignation rates reflects a pent-up desire to change jobs. Many mid-tenure employees postponed leaving their jobs in 2020 because of pandemic-caused uncertainty.

Cook stated that resignations are highest in the tech and health care industries — those that felt the heaviest demand due to the pandemic and placed heavier workload burdens on their employees. Resignations decreased in the manufacturing and finance industries.

Job search site Monster.com recently released a fall forecast based on weekly surveys of job candidates and employers. Among its top findings:

• Burnout was the No. 1 reason employees gave for quitting their jobs, and concern over the Delta variant was the top reason candidates paused or stopped their job search.

• 86 percent of workers said their careers have stalled during the pandemic, and 77 percent of candidates said they define career growth as a salary increase.

• 96 percent of workers said they would consider changing jobs, and nearly 30 percent of employees said they were quitting due to a lack of growth opportunities.

• But nearly half of workers (45 percent) said they’d be more likely to stay on the job with their current employer if they were offered skills training. Tech skills such as coding and AI, basic computer skills like Microsoft Office and Google Docs, and occupation-specific training were the skills candidates said they needed the most.

• 51 percent of job candidates are looking for higher salaries, and 42 percent want more flexibility when it comes to work-life balance.

“I fundamentally believe that the world has changed in 18 months,” Monster CEO Scott Gutz said. Along with upskilling, conversations with prospective employees must include flexibility; safety and security; career paths; mission and vision; and diversity, equity and inclusion, he said. 

STATE, LOCAL TRENDS

The latest jobs data from the Colorado Department of Labor and Employment’s monthly surveys indicate that in some ways, the state is faring better than the nation as a whole.

According to the department’s monthly survey of households, the number of employed people grew by 9,300 in September to 3,013,500, or 64.3 percent of the state’s working-age population. Colorado has one of the highest employment-to-population ratios in the nation, ranking seventh in August.

CDLE also conducts a monthly business employment survey. That data for September showed that the state has added back 297,900 of the 375,800 nonfarm payroll jobs that were lost between February and April 2020. That translates to a job recovery rate of 79.3 percent, which exceeds the national rate of 77.8 percent.

Over the past year (as of September), average hourly earnings increased from $31.02 to $32.46. That compares with the national average hourly earnings of $30.85.

This data represents the latest available from the CDLE. October data will be released Nov. 19.

According to Dr. Tatiana Bailey, director of the UCCS Economic Forum, Colorado’s unemployment rate of 4.6 percent and El Paso County’s rate of 4.8 percent “are pretty much at the ‘natural rate’ of unemployment, which is seemingly good news. 

“But ask just about every employer whether they can find workers and you’ll get an earful,” Bailey wrote in a narrative accompanying the forum’s October 2021 dashboard.

“There is indeed a lot of talk and data to support that employees have the upper hand in the labor market right now.” 

Bailey discussed the Great Resignation during the forum’s 25th annual presentation Oct. 14. 

“Workers are not returning to the labor force as anticipated” following the end of supplemental unemployment benefits, she said.

Some of the factors contributing to the current labor shortage are transitory, such as COVID and vaccination worries, parents whose kids’ schools are quarantined, people living on savings and remaining government assistance, people changing industries or moving, and businesses that have closed — including 110,000 restaurants nationwide.

These factors will resolve eventually, Bailey said, but what worries her more are “structural” factors: lack of child care; skills gaps; shifts in family and personal priorities; and more early retirees. These factors mean that workers can be choosy and may prefer flex schedules or working at home.

El Paso County’s labor force participation is trending in a positive direction, Bailey said. 

“We do still have an elevated number of unemployed — we have about 190,000 in the state of Colorado compared to 88,000 in February 2020,” she said. “But the labor force participation is almost back to pre-COVID.”

The best news locally is that, of all the major metropolitan areas in the state, “we have regained really all of our jobs,” Bailey said. The Colorado Springs MSA has gained 106 percent, or 54,317, of the 51,373 jobs lost in March and April 2020. That compares to about 90 percent in Colorado and 81 percent nationwide.

“This job recovery is amazing considering the large hospitality sector that we have,” she said, “but also it’s cushioned somewhat by the diversity of industries, including professional and technical jobs where people can work from home.”

Although there are plenty of job openings — 11 million nationwide in July, and 27,142 in the Colorado Springs MSA in September, many people do not have the skills required for those jobs, Bailey said.

“There is a big argument to be made for reskilling and upskilling people,” she said.

UPSKILLING

Despite a number of offerings to help employees reskill and upskill, the Pikes Peak Workforce Center is not seeing a lot of in-person traffic, Executive Director/CEO Traci Marques said. But half of those who are coming in are looking to change careers.

PPWFC does not have data on what industries people are migrating to, but Marques said she hopes to get some indications by seeing what happens at the upcoming USAA community and veterans job fair.

The job fair will bring together more than 75 employers across a variety of industries from 10 a.m.-3 p.m. Nov. 10 at the Colorado Springs Event Center, 3960 Palmer Park Blvd.

The top five skills PPWFC is seeing in job postings include products like Microsoft Word, Excel and Zoom.

“A lot of those skills people needed for jobs prepandemic are very similar,” Marques said. “People may think they have those skills, but are they efficient? That’s going to be a different question.”

PPWFC offers several forms of assistance to employers to help them retain employees.

The center received a $1.8 million Ready to Rise grant from the state in October to support people looking to earn industry-recognized certifications or credentials that can be completed in 12 months or less.

The funds are available to people whose households have been affected by COVID-19 since March 2020. That could include a family member who got a pay cut, for example.

“We’re just starting to roll this program out,” Marques said. “It’s not just for the unemployed. Employees really want the opportunity for professional development, and companies may not have the money to be able to do it, but this would be able to pay for it. That shows buy-in by the employer.”

Marques recommended that businesses reach out to their employees to inform them of this opportunity and let them know they will be supported as they attend training.

Individual employees must fill out an application on the center’s website, ppwfc.com. PPWFC counselors will assist applicants in determining eligibility for the funding and help them find appropriate programs.

FINDING THE CAUSES

Besides offering upskilling and training opportunities, employers can make sure their compensation and benefits are in line with what their industry’s job market requires, said Maggie Roddy, a staff attorney with Employers Council, which assists employers with legal, HR and training needs. 

Employers Council recommends that employers conduct a stay interview — “asking employees what keeps them at work, what they enjoy about their job and asking if they have any suggestions of things that would keep them at work, and trying to pursue what they can,” she said.

Cook, in the Harvard Business Review article, recommends that employers take a data-driven approach:

1. Quantify the problem. Calculate the business’s turnover rate: number of separations per year ÷ average number of employees. Use similar formulas to determine the rate of voluntary separations versus layoffs or firings. Then determine the impact of resignations on key business metrics including skillsets or resources lost, quality of work, time to completion, burden on team members and bottom-line revenue.

2. Identify root causes. Explore metrics such as compensation, time between promotions, size of pay increases, tenure, performance, training opportunities and demographics to see how retention rates differ across employee populations and what is causing staff to leave.

3. Develop tailored retention programs aimed at correcting significant issues. Some companies may not have the data infrastructure to make these determinations, Cook wrote, but it’s worthwhile to invest in a system that can track and analyze these metrics.

“With greater visibility into both how serious your turnover problem really is, and the root causes that drive it,” Cook said, “you’ll be empowered to attract top talent, reduce turnover costs, and ultimately build a more engaged and effective workforce.”

Reporter

Jeanne Davant is a graduate of the University of North Carolina. She worked for daily newspapers in D.C., North Carolina and Colorado, and has taught journalism and creative writing. She joined the Business Journal in 2017.