The Great Resignation is morphing into The Great Retention race
The Great Resignation is one of those phenomena that has hit some organisations hard – and those responding to it well are putting their energies into long-term, sustainable retention of their people.
As 2021 drew to a close, news of The Great Resignation was constantly in the business media, mostly coming from the USA – and I decided to investigate what was happening in the UK. To do that, I interviewed 14 leaders in law, finance, technology, recruitment, consultancy, PR and association management between December 2021 and January 2022.
What I found was fascinating – firstly, yes, there is a movement of people coming and going from employment and in some sectors (law, finance and technology) leaders are finding this a real problem. But this is not universal and ranged from a partner in the finance sector saying they had 20% fewer staff than normal now, to those in a smaller business saying there wasn’t a problem at all.
As these were structured, qualitative interviews with senior leaders, I can not in any way extrapolate data to make representative conclusions. Saying that, and given the limited sample size, there were some themes.
Lack of people
In some professions there are currently not enough people to fill the roles available – but why this is the case is under debate. It could be a backlog of graduates waiting to take professional exams. As one interviewee said, ‘In professional services, firms cut their training. You’ll have at least a year or maybe two, where fewer people are qualifying around now and over the next couple of years. There will be less of them to go around[i]’.
Timing can be an issue
In the finance sector, the timing of resignations is cyclical and tied to bonuses, i.e., people resign just after they’ve received their annual bonus. ‘I think there are more opportunities to more out there, than there previously has been[ii]’.
He also considered the smaller the firm, the more difficult it would be to find people. ‘The big six firms in accountancy just hoover up as many people as they can. I think from number 10 down, they would all say exactly the same thing; recruitment is our biggest issue[iii]’.
What firms are trying
People are infinitely creative and resourceful; leaders in the professional services organisations I spoke with were employing a number of strategies to try and stem the outgoing tide of people, including:
- Speeding up the recruitment process to be a week of less (and maintain a probation period of six months)
- Paying larger than usual bonuses
- Paying retention bonuses
- Increasing salaries (a newly qualified lawyer is hitting close to a salary of £100k in some firms).
- Increasing benefits
- Ensuring flexibility in time and place of work.
The financial consequences of these policies will ultimately mean increased costs for clients.
Concerns about meeting client demand
A few of the participants in the study were also concerned about the ability of their firms to meet client demand, which had increased over the last year. ‘The real driver is just how well companies are doing on the stock market. The pandemic is sort of irrelevant. And that’s proven in the fact that you’ve got so much activity. You would think that COVID would have smashed the markets, but stock prices are the highest they’ve ever been[iv]’.
Pressure on those left behind
The steady demand, ‘Law firms have never been busier[v]’, combined with a battle for talent, is putting pressure on those remaining. ‘You’ve got fewer people doing the job, so by default, you’ve got less time because you’re filling in for those people that we haven’t recruited. And then you’re addicted to the recruitment. That spiral has a knock-on effect and we’re trying to work out how to balance all of that[vi]’.
On a personal level that means more pressure and sleepless nights, despite not having to commute to an office every day. ‘It’s not as if those hours have been regained for my personal enrichment in some fashion, or exercise or all the things that my doctor tells me I should be doing. We’re not working any less. If anything, we’re working more and that is across the board[vii]’.
And senior leaders have returned to doing roles they thought they had left behind – one stepping in to replace their Business Development person when they resigned. ‘It was stressful, difficult and at no point do client expectations lessen[viii]’.
Meeting individual requests
If my interviewees are representative of their industries, there are simply not enough qualified people in the law, finance and technology sectors to meet the demand. Those firms managing well are not necessarily the ones paying the most – they’re the ones providing the conditions that align with an individual’s goals. ‘If people are not pretty much completely happy where they are, they will go off to the next place and fight to get what they think they can get from them, be that money, or the balance or working at home as opposed to an office … it’s a real challenge[ix]’.
The leaders of the firms I spoke with all actively cared for their people and consciously provided physical and emotional support during the pandemic. In the medium term, they kept returning to increasing retention as the best option to move forward. ‘We’re having conversations about retention at the executive level of the organisation[x]’.
Any retention strategy an organisation comes up with must focus on the people – there’s nothing new in that, but it can be difficult to implement when many people want different things; like a culture of autonomy, democratic decision-making, reasonable hours, increased expectations of flexibility – and the list goes on.
What’s important in creating a retention strategy is that it aligns with the purpose of your firm, keeps working towards your vision and empowers your people to see the work they do as valuable for them and their career growth as well as for the organisation as a whole.
[i] Managing Director of a data analytics firm.
[ii] Partner, international financial services firm
[iii] As above
[iv] CEO of an international law firm
[v] As above
[vi] Partner, international financial services firm
[vii] Founder and CEO of a PR firm
[viii] CEO of a technology and custom software development firm
[ix] Managing Director of a data analytics firm.
[x] Partner, international financial services firm
Download your free ebook to discover how to lead in a way that makes an impact.
Founder of Leading with Humanity
Veronica believes that courageous, compassionate and inspiring leadership is needed to deal with the crises we face in the world at the moment, and that this style of leading is something we can all achieve. Her mission is to play her part in making leading with humanity an everyday reality.
She has a background in business, journalism, counselling and association management. She is an ICF certified Integral coach and has more than 20 years’ experience coaching.