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The "Great Resignation" - How Businesses Can Lessen the Impact by Prioritizing Employees' Holistic Wellbeing

The COVID-19 pandemic is rewriting the future of business. Employee priorities have changed as a result of the pandemic, pushing companies to reexamine their employee benefits offerings. Key areas of concerns include their physical wellbeing, peace of mind and financial health—huge issues that are challenging employers to consider employee benefits they might have ignored in the past.

Remote work brought on by the pandemic has also fundamentally changed how many of us experience our jobs and even the kind of work we do. Recently, much attention has been given to the so-called “Great Resignation” – a period of high turnover as workers gain more confidence in the economy, and therefore feel more comfortable in making significant career changes.

According to the federal Bureau of Labor Statistics, April 2021 marked the highest quit rate in two decades at 2.8%. June’s rate was only slightly lower at 2.7% (an equivalent of 3.9 million Americans). For perspective, the average is typically around 2% a month. According to a recent report released by Microsoft, 41% of the global workforce indicated that they were considering quitting their job over the next year. Turnover costs organizations in both time and money to recruit and train new employees—not to mention the loss of institutional knowledge and reduction in productivity while positions remain vacant.

While millennials and Gen Z have been attributed to driving much of the recent exodus, there is another key group that employers should not lose focus on – those near or close to retirement age, who, given the new climate of health concerns or pandemic stressors, have decided to retire early. For those who remain working, are they doing so for other reasons or are they potentially experiencing greater financial stress and needs to continue working beyond normal retirement age? Recent studies have shown that upwards of 59% of baby boomers have less than $100,000 saved for retirement. The negative effects of financial stress manifest into physical health problems and decreased productivity. Conditions often include sleep deprivation, substance abuse, anxiety, depression and increase in chronic conditions such as high blood pressure and obesity.

So while one obvious concern of business leaders during this “Great Resignation” period focuses on the organization’s employee-retention dynamic, health care costs should be a major concern as well. Health care costs may quickly exceed prior plan performance if the new workforce exacerbates a less healthy, more financially stressed population in a time when healthcare trend continues to outpace other inflationary factors. Whether you planned for it or not, your “new” workforce population may create challenges and costs far beyond solely talent acquisition priorities. Let’s also not forget that businesses are still continuing to deal with the direct healthcare costs of COVID-19.

Business leaders need to grasp now not only the talent that may leave employment during the “Great Resignation”, but how the resulting population may differ from pre-COVID workforces.

  • Are they trending older and need help in achieving retirement readiness?
  • As a result, are promotion opportunities vanishing for up-and-coming top talent that could force them to look outside of your organization for career growth?
  • Are your retirement plans designed appropriately to give employees the opportunity to adequately build their savings?
  • Is a knowledge deficit created by your changing workforce?
  • If your population is trending less healthy and older, what strategies are you deploying the combat potentially higher cost constraints and mitigate new risks?
  • Are your employees enrolling in the appropriate medical plans that allow dollars to be allocated for future medical and retirement expenses?

At OneDigital, we use an integrated approach to workforce strategy to unleash business growth and people potential. By leveraging our human resources consulting and retirement and wealth capabilities alongside employee benefits —we’re equipped to provide a holistic consulting approach to help our customers reengage their employees and lessen the impact current economic and social circumstances have on their business.

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