Industry braces itself for ‘the great resignation’

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Report by Auckland University of Technology

Imagine if we woke up to discover that half of our doctors, nurses and healthcare workers had chucked in their jobs. The impact on our health, society and economy would be devastating. New evidence suggests they – and many others across a swathe of professions and roles – are considering doing just that.

Internationally, and especially within the United States, there is a lot of talk about the “great resignation” – the informal name for the widespread trend of a significant number of workers leaving their jobs during the covid-19 pandemic.

Here in New Zealand, a nationwide study led by AUT Business School Professor Jarrod Haar shows that, since the study began last year, more Kiwi workers are thinking about either changing or throwing in the job towel (defined as “turnover intentions”).

The AUT Wellbeing@Work iterative survey involved just over 1,000 participants in three separate time periods – May 2020, December 2020 and April 2021.

While each cohort is distinct, the three groups comprised participants of similar age range (approx. 39 years on average), gender (approx. 50/50, male/female split), and employment sector (approx. 70% private sector).

Over the course of the survey, the number of employees with no thoughts of leaving their jobs halved, from 19.1% in May 2020 down to 9.2% the following April 2021 – a 52% reduction. At the other end of the scale, those most likely to leave (“high turnover intentions”) increased from 34.7% in May 2020 to 46.4% in April 2021 – a 34% increase.

Professor Haar says there are two key drivers of turnover intentions: (1) how much an employee likes their job (including pay), and (2) what other employment opportunities exist for them. For example, someone might hate their job but has low or no turnover intentions due to a lack of other roles.

The findings show that job satisfaction did not change over the time periods. On average, employees in April 2021 liked their jobs as much as they did in May 2020. Professor Haar says that suggests New Zealand’s workforce is generally satisfied.

But the perceptions around job opportunities have changed. In 2020, roughly half of employees felt they had some decent job opportunities available to them. But by April 2021, this perception had increased by almost a third, to 66 per cent.

“The findings suggest the great resignation may well be happening in New Zealand,” says Professor Haar. “Perhaps differently from overseas, the biggest driver here is the lure of new job opportunities – more pay, more personal development, or more ‘making a difference’.”

Professor Haar says the findings should alarm employers and further incentivise them to look after and retain their current employees. This is particularly relevant when restrictions on employment mobility from overseas are so tight.

“Within the context of Covid, access to the international labour market is slight. Employers need to recognise that there may be few new employees – especially quality employees – to recruit. Holding on to current employees and looking after their wellbeing is key to keeping the Kiwi workforce, economy and society at large as healthy as possible in these pandemic times,” says Professor Haar.

Focusing on the high turnover group in April 2021, findings of note include:

  • Overall, managers had similar odds of leaving as employees.
  • There are no gender differences or sector differences.
  • There are no differences by ethnicity (e.g., Māori).
  • When we look at specific profession groups, there are significant differences in who is more likely to consider leaving:
  1. Labourer/factory worker 64%
  2. Health/Support services 55%
  3. Sales/customer service/retail 52%
  4. Tourism/Hospitality 51%
  5. Trades 47%
  6. Information technology 46%
  7. Other 45%
  8. Clerical or administrative 41%
  9. Teaching/Education 39%
  10. Semi-skilled worker 37%
  11. Other professional 33%

The findings suggest that low skilled workers are the most likely to leave – possibly motivated by the draw of better pay and work conditions. Health workers, tradies and information technology workers are more likely to stay in the same profession but are motivated to secure a new role with new people, greater opportunities, and higher pay.

The findings in the tourism/hospitality sector may well reflect the number of employees seeking to leave their profession due to the industry strains from Covid-19.

Below is a breakdown of “turnover intentions” over the course of AUT’s Wellbeing@Work study:

 May  2020Dec 2020April 2021
No turnover thoughts 19.1% 10.7% 9.2% 
Low Turnover thoughts 20.1% 27.3% 18.4% 
Moderate Turnover thoughts 26.1% 22.4% 26.0% 
High Turnover thoughts 34.7% 39.7% 46.4% 
 100.0% 100.0% 100.0%
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