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“The Great Resignation” What caused it and what can you do about it?

By Nancy Owen, PHR, Senior HR Consultant, East Coast Risk Management

The “Great Resignation,” also known as the “Bit Quit,” is thought to have started as a result of the COVID-19 pandemic. However,  many things came together to form this perfect storm of employee resignations and labor shortages. So how did this happen?

The rapid decline in the US economy,  coupled with employees’ fears of the COVID 19 virus and a forced isolation, had many employees re-evaluating their lives. It seems that employees now feel that life, health, and family come before a career or their work success.

It is believed that the current labor shortage was fed by the increase in unemployment benefits, child tax credits, and eviction suspensions. At the same time, people were spending less on entertainment due to COVID isolation which gave low-income workers the opportunity to reduce costs and increase their income without working at all.

According to 3NG Consulting, however, the fact that this Great Resignation is a global phenomenon is not so easily explained.  Countries in Europe and Australia are experiencing similar conditions with very different economies and employment structures than the United States.

For the United States, the perfect storm included:

  • Retirements: Many senior staff members in their 50s and 60s decided to retire instead of returning to the office.
  • Retraining: Minimum wage hospitality workers took the time during the pandemic to seek education on skilled trades and are not returning to their previous hospitality jobs.
  • Budgeting: Workers reduced their expenses during the pandemic, and many are now single earner households.
  • Entrepreneurialism: More people have left jobs to start their own companies. The labor department is showing an increase in small business applications between 200% and 600% year over year.
  • More “gig” opportunities: Options such as Uber and Lyft were present prior to the pandemic; however, these opportunities became more appealing and more in demand.  In addition, delivery services such as Roadie, Postmates, DoorDash and others have exploded during and after the pandemic.  When given the opportunity to schedule themselves, work when available, and make reasonable money, a lot of workers have opted not to return to their minimum wage jobs.
  • Remote Work: Extended remote working has changed employee and employer perspectives. Employees have enjoyed less time commuting, more time with family, and less money spent on food, fuel, and cars.  They have also enjoyed more flexible schedules and a new perspective on what kind of work/life balance was possible.
  • COVID deaths: More than 700,000 deaths in the U.S. have been attributed to COVID.  While many were elderly, between 200,000 and 300,000 working Americans were among those who died.  And many others have been disabled by long COVID.
  • Decline in Population Growth: The birthrate in the U.S. has declined while immigration restrictions have further slowed the arrival of new workers. The net result is the reduction of workers to fill job vacancies.
  • Vaccine Mandates: Some workers who refuse to become vaccinated against COVID have resigned from organizations with mandates to join companies that do not have vaccine mandates.

What can you do?

It is much more cost effective to retain an employee then to recruit a new hire. So, after you attract new employees, reward, and retain them.

To attract the best candidates, consider a company recruiting audit or assessment to determine if your process and procedures are in order with the changes. Starting with well thought out job descriptions, job postings that sell the job to candidates, and competitive salaries.


  • Offer flexible work schedules that allow balance of life
  • Conduct a compensation/benefits assessment
  • Reconnect with good performers who have left the company
  • Implement a referral program

What makes your organization stand out in an employee market? A good practice is the review your comp and benefits to determine if they are competitive.  For example, could you offer more PTO? Can you add low-cost benefits like short-term disability? Some organizations are contacting past employees who left in good standing and asking them to return or refer someone to them. Referral programs are a must these days. Some companies have told us they have recruiting committees made up of employees who brainstorm on how to attract good talent.


  • Recognize good work and dedication so employees feel valued
  • Communicate with employees
  • Offer regular feedback
  • Solicit opinions
  • Practice professional good manners with employees
  • Do not just talk the talk but walk the walk

Once you have employees on board, rewarding and retaining them are key. Reward your employees by providing them with the recognition they deserve.  Communicate kudos in one-on-one and  group settings. Remember that recognition can happen in small ways. Every day feedback is a counterpart to recognition.  Celebrate work anniversaries. Employers may not think it matters, but it does – especially milestone anniversaries. It shows employees that you care and are paying attention to how much time the individual has devoted to the organization.


  • Implements “stay interviews” and exit interviews
  • Encourage a mentoring mindset among your leaders
  • Develop an open-door policy that encourages employees to speak freely
  • Encourage input and feedback
  • Show appreciation and respect
  • Listen

Consider stay interviews along with exit interviews and capture as much helpful information as possible. You want to learn what makes employees leave and what makes employees stay. Do your leaders have a mentoring mindset? Are they mentoring and coaching for success? Do you allow your employees to speak freely to you by having an open-door policy? Are they encouraged to give input and feedback? Think about the ways you show your employees appreciation and respect. Listen to your employees. You may learn something valuable.

If you are an employer with questions about any safety, workers’ compensation, or human resources issue, contact East Coast Risk Management by calling 724-864-8745 or emailing us at We will be happy to help!

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