Thursday, August 19, 2021

The Great Resignation

While China is busy contending with the "Lying Flat" movement, where young people are rebelling against their work culture, the US is also facing a different work phenomenon. Apparently, the number of folks resigning from their jobs reached the peak in April 2021 and managers are struggling to keep their employees. 

I've only read a few articles on this phenomenon and I can't wait to see what social scientists can say about this. 

Here are some of the reasons that can possibly be a driver for The Great Resignation :

a) Folks stuck to their jobs during the pandemic now think that it is time to resign 

One explanation is that a lot of folks were stuck with jobs they don't necessarily like during the pandemic but they could not resign then because it's hard to find a new job then. When the vaccines started getting deployed, the economy opened up and it's time to move onto something new. 

The workers who are affected the most by a more negative workplace are workers in the hospitality, F&B and leisure sectors.

b) Folks can see a life beyond the standard daily commute to the office

Another explanation is that the pandemic forced a lot of companies to make it easier to work from home and employees have gotten used to this arrangement. As the economy reopens, middle managers are pushing to get their employees back to the workplace, so employees are looking for a new company that is willing to make work from home the norm. 

This explains the number of professionals who are quitting the workplace. 

c) Generous welfare cheques reduces the motivation to carry on working.

The third reason is that during the pandemic Biden was generous with welfare cheques to help Americans get through their lives. Some Americans may have been able to squeeze the welfare cheques for a much longer time than others so may be able to go without work for a longer period of time. 

I like this explanation because it explains why Singapore is not experiencing our version of the Great Resignation here yet.

The long term repercussions of any recessions are always very interesting. 

In the last Great Recession, labour economists found that some single men got so discouraged, they basically left the workforce and never returned to having a regular income. Surveys on personal happiness were kept up because of video games, social media and streaming. This led to the birth of the Incel subculture. During this pandemic, the labour participation of women was hit much harder than men, and it would be interesting to see what happens over the next few years. 

1 comment:

  1. If you look at the 30,000-foot stats of US savings & income, both have shot up during Covid (savings have shot thru the roof). Giving a lot of people in US optionality, such as giving the boss the middle finger, or demanding big increments or permanent WFH or WFA.

    Even ball-busting "F**K YOU RECRUIT!!!!" firms like Goldman are caving in & paying freshies USD120K basic. Which is actually kinda underwhelming as I know quite a few people who got 6-figure starting salaries on Wall St with slightly above average MBAs way back in 1999/2000 (and that's when US$1 = S$1.80).

    Another phenomenon is the tons of boomers retiring, which is mainly due to combination of steroidised retirement accounts & structural work changes not sitting well with their boomer mindset e.g. 24/7 availability on whatsapp/zoom/email.

    This sudden mass retirement of a single generation is "unprecedented" (again) in the last 100+ years. And it's a big bonus to Gen Z and younger millennials.

    So much so, that even with still-elevated unemployment in the US, there're more job openings than unemployed people. Paraphrasing from the mortgage shenanigan days of 2006: anybody in the US who can fog a mirror can get a slacker job paying at least US$15/hr now.