How a Record Number of People Quitting Is Affecting Businesses

by Clayton Edwards

Right now, America’s workforce is seeing a major shift. For one, many Baby Boomers are taking the opportunity to retire early. Additionally, people of all ages are walking away from their jobs in record numbers. Some are calling it the Great Resignation and it is a complex issue with a laundry list of causes. However, the effect for many businesses is the same. They’re understaffed.

We see evidence of this in restaurants and stores of all sizes across the country. For instance, patrons are seeing longer wait times in restaurants. In stores, “help wanted” or “we’re hiring” signs have become part of the décor.  Behind the scenes, employers in several sectors, especially hospitality and retail, are finding it harder to fill empty positions. These are all effects of the Great Resignation.

However, the effects of this phenomenon go deeper. As the Great Resignation makes it harder for employers to fill positions, they’re finding that they have to be more flexible. According to a 60 Minutes report, workers’ standards are higher than they once were. For many Americans, the notion of “I’m just lucky to have a job,” is long gone. Now, workers are demanding better benefits, higher wages, and more flexible schedules, among other things. As a result, employers who aren’t willing to meet candidates in the middle continue to find themselves short-handed.

Some experts predict that the Great Resignation will end when those who remain unemployed deplete their savings. However, employees will expect the new perks they’re seeing from their jobs right now. So, in the coming year, we may see more and more people returning to the workforce. But, when they return, they’ll find a professional landscape that is fundamentally different than it was just two years ago.

What Caused the Great Resignation?

The simplest answer is that the pandemic caused the Great Resignation. When COVID hit, several businesses shut down. Those that didn’t close had to reduce their staff. Additionally, the US government offered higher-than-usual unemployment benefits across the board.

Many will point to those benefits as the root cause of the current record-high quit rate. However, LinkedIn’s chief economist Karin Kimbrough disagrees. She told 60 Minutes, “What we saw was that when these benefits were turned off, when workers were no longer getting the benefits, they did not rush back to work.”

Carl Sobocinski saw this firsthand. He owns several restaurants in Greenville, South Carolina. The pandemic hit his staff hard across the board. Currently, all of his restaurants are shorthanded. He doesn’t blame the benefits. “Our associates that didn’t come back, they’re not sitting at home. They found other careers, other opportunities, that fit their lifestyles better.”

Kimbrough summed up the overall effects of the Great Resignation. “It’s as if that social contract of work is being rewritten. Right now, the worker’s holding the pen. There are just thousands of available jobs in America right now. And companies are eager to hire. But workers are being very choosy.”