What is the "Great Resignation"?

The "big quit" is the term used to describe the increase in job turnover rates in some sectors and countries since mid-2020

The "great resignation" of workers in the 21st century is a phenomenon that has been observed in several countries, especially in the United States, where millions of people have left their jobs since the start of the covid-19 pandemic.

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What are the reasons behind this wave of resignations? What consequences does it have for companies and the economy? What opportunities and challenges does it pose for workers?

What is the "Great Resignation"?

In this article, we will try to answer these questions and analyze the main trends that are driving this change in the labor market.

What is the "great resignation"?

The "big quit" is the term used to describe the increase in job turnover rates in some sectors and countries since mid-2020. According to data from the United States Department of Labor, between April and October 2021, more than 24 million American workers quit their jobs, marking an all-time high.

This phenomenon is not limited to the United States. According to a Microsoft study, 41% of global workers plan to leave their current job or change careers this year. Other countries such as the United Kingdom, Canada, Australia and Japan have also reported increases in job resignations.

What factors explain the "great resignation"?

There is no single cause that explains the "great resignation", but rather a combination of factors that have influenced the workers' decisions. Some of the most relevant are:

- The covid-19 pandemic: The health crisis has caused a reassessment of the priorities and expectations of many workers, who have sought a greater balance between their personal and professional lives, more flexibility, autonomy and security. The pandemic has also accelerated digital transformation and the adoption of teleworking, expanding workers' options and mobility.

- Labor shortage: The low supply of workers in some sectors, such as hospitality, commerce or health, has generated greater demand and upward pressure on wages and working conditions. This has given more bargaining power to workers, who can choose between more offers or demand better benefits.

- Accumulated savings: Many workers have been able to save money during the pandemic, by reducing their expenses on transportation, leisure or travel. This has given them more financial room to change jobs, start their own business or take a break from work.

- Generational change: Younger workers, such as millennials or generation Z, have different preferences and values ​​than previous generations. These workers seek greater purpose, impact and satisfaction in their work, as well as greater diversity and inclusion. They are also more likely to change jobs frequently to gain new skills and experiences.

What consequences does the "great resignation" have?

The "big resignation" has both positive and negative implications for businesses, the economy and workers. Some of them are:

- For companies: The "great resignation" represents a challenge for companies, which have to face greater difficulty in recruiting and retaining talent, as well as higher labor costs. This can affect your productivity, competitiveness and innovation. On the other hand, the "great resignation" can also be an opportunity for companies that adapt to the new demands and expectations of workers, offering a differential value proposition that allows them to attract and retain the best talent.

- For the economy: The "great resignation" can have a positive impact on the economy, by boosting the dynamism, mobility and efficiency of the labor market. It can also lead to increased wages and consumption, which can stimulate economic growth. However, the "big resignation" can also have negative effects, such as labor shortages in key sectors, inflation or inequality.

- For workers: The "great resignation" can be an advantage for workers, who can take advantage of the situation to improve their working conditions, change jobs or careers, or undertake their own projects. This can increase your well-being, motivation and professional development. However, the "big resignation" can also entail risks, such as instability, uncertainty or loss of social benefits.

What challenges and opportunities does the "great resignation" pose?

The "great resignation" is a phenomenon that reflects the profound changes that the world of work is experiencing in the 21st century. These changes pose challenges and opportunities for both companies and workers, who will have to adapt to the new realities and trends in the labor market.

Some of the challenges and opportunities that arise are:

- For companies: Companies will have to review their talent management strategies, in order to attract, retain and develop workers in a more competitive and changing environment. This means offering a more flexible, inclusive and purpose-driven organizational culture, as well as more attractive and personalized working conditions. It also implies betting on continuous training, innovation and digital transformation, to keep up to date with market and customer demands.

- For workers: Workers will have to assume greater responsibility for their professional career, seeking the opportunities that best suit their interests, values ​​and objectives. This implies being willing to constantly learn, acquire new skills and adapt to changes. It also implies having a broader and more diverse vision of work, exploring different employment options and modalities.

The "great resignation" is a phenomenon that is here to stay, at least until a new balance is reached between labor supply and demand. In the meantime, both companies and workers will have to face the challenges and seize the opportunities that this change presents for the future of work.