Great Resignation

What is the Great Resignation?

In 2021, the marketplace saw a significant increase in voluntary employee turnover due to pandemic-related factors, work-life balance, and career advancement. This trend, known as “The Great Resignation”, was more pronounced in light of the pandemic and the rise of remote work and hybrid roles.

Many companies are struggling with employee retention, causing disruptions to daily operations and leading to excessive workloads and employee burnout. This ultimately affects overall performance, engagement and productivity. In this guide we will provide a comprehensive understanding of the Great Resignation phenomenon, including its causes, implications, and coping strategies for companies and employees.


Putting a name to the experience

The Great Resignation refers to the significant increase in employees quitting their jobs due to pandemic-related factors and other reasons. In August 2021, the US Bureau of Labor Statistics reported a record high of 4.3 million people quitting their jobs.

A survey by Microsoft in April 2021 reported that 41% of the global workforce is considering quitting or changing their professions. The reasons for the Great Resignation include pandemic-related burnout, a desire for better work-life balance, and a reassessment of employees priorities and career goals.

Remote work has also become more prevalent, with many employees preferring its flexibility and autonomy. The Great Resignation may significantly impact the labor market, as companies may struggle to retain talent and fill open positions. It could also lead to a shift in power between employees and companies.

Employees on a conveyer belt headed for the exit used as a metaphor for the Great Resignation

Causes of the Great Resignation

Various factors, including the pandemic, work-life balance, and career advancement, brought about the Great Resignation. The imminent increase was the result of the following:

  • COVID-19 pandemic: The pandemic caused many disruptions to work routines, with many employees  working from home for extended periods. As the world opens up, many employees  have realized they no longer want to return to the office full-time, leading to a wave of resignations.
  • Burnout: The pandemic has also caused significant stress and burnout for many employees, leading them to reevaluate their priorities and change their careers.
  • Lack of work-life balance: Many employees are now seeking more flexible work arrangements that allow them to balance their personal and professional lives. They want to work for companies  who support this and offer more remote and hybrid work options.
  • Career advancement: Many employees  have put their career goals on hold during the pandemic and are now looking to advance their careers, which may not be possible in their current roles.
  • Dissatisfaction with their company: Employees have become more selective and are scouting for companies that orient their values and give a positive work environment. Companies that do not meet these expectations may experience higher turnover rates.
  • Competitive job market: As the job market rebounds, more opportunities are available for employees, giving them more leverage in negotiations and increasing their chances of finding a job that suits them better.
  • Generational shifts: Younger generations, such as Millennials and Gen Z, have different priorities and expectations than previous generations. They focus more on meaningful work, work-life balance, and social responsibility. This shift in priorities has caused many employees to leave their jobs for more fulfilling careers.

Companies must listen to their employees and make changes to meet their evolving needs to attract and retain top talent. The pandemic and rise of remote work caused many employees to reassess their priorities, leading them to leave their current jobs in search of better opportunities and more flexible work arrangements.

Employee sitting on a bed working on their laptop

Implication of these workplace shifts

The Great Resignation has had significant implications for both companies and employees. For companies, it has increased turnover rates and costs, difficulty hiring and retaining talent, and the necessity to adapt to the changing workforce demands.

It has also brought about the potential for company culture and reputation damage. The Great Resignation has significant implications for both companies and employees. Here are a few of the most critical implications:

  • Increased competition for top talent: With so many people leaving their jobs, there is increased competition for skilled employees. Companies who want to attract top talent must offer competitive salaries, benefits, and a positive work environment.
  • The need for a flexible and hybrid work model: The pandemic has shown that many jobs can be done remotely, which has led to an increased demand for hybrid work arrangements. Companies  who offer flexible work arrangements will have an advantage in attracting and retaining employees.
  • A shift in power dynamics: As employees have more choices about where they work, the power dynamic between companies  and employees is shifting. To remain competitive, companies must adapt to their employee’s changing needs and expectations.
  • Potential for innovation and creativity: The Great Resignation may surge entrepreneurship and innovation as more employees pursue their passions and start their businesses. This could lead to new ideas and solutions to existing problems.
  • Impact on the economy: The Great Resignation could significantly affect the economy, particularly in industries already facing labor shortages. If enough employees leave their jobs, it could lead to slower economic growth and higher inflation.

Companies who adapt to their employees’ changing needs and expectations, such as digital transformation, will be better positioned to attract and retain high-quality talent. For employees, it has increased their opportunities, improved their work-life balance, mental health and flexibility, and the potential for career growth and higher pay.

How it affects companies

The rise in voluntary employee turnover, often termed “The Great Resignation,” has both a short and long term effect on a company’s organization structure. Here is how it affects companies:

  • Difficulty in filling open positions: As more employees leave their jobs, companies may need help finding qualified candidates to fill open positions. This can lead to longer hiring processes and may result in unfilled positions.
  • Loss of talent and experience: Employee retention is a big challenge; most employees leaving their jobs may be some of the most skilled and experienced employees in their companies. Losing these employees can mean a loss of institutional knowledge, skills, and experience, which can be challenging to replace.
  • Increased costs: Hiring and training new employees can be expensive for companies. The cost of recruiting, interviewing, and onboarding new employees can add up quickly, especially if there is a high turnover rate.
  • Need for retention strategies: To retain their best employees, companies may need to reevaluate their retention strategies. To attract and retain employees, companies should have a strong employee value proposition beyond just salary and job responsibilities; this could include offering better benefits, improving work-life balance, creating opportunities for career growth, and communicating clear company culture and values.
  • A shift in company culture: The Great Resignation could also result in a change in company culture. To attract and retain employees, companies  may need to rethink their approach to work, including their expectations around remote and hybrid work.

The Great Resignation can significantly impact companies, and they may need to adapt to these changes without altering their culture, mission, and vision to stay competitive in the job market.

What companies should have learned

The Great Resignation has allowed companies to reflect on their current policies and practices and make changes that can help them attract and retain talent. Here are some of the lessons that companies should have learned from this trend:

  • The importance of work-life balance: Many employees leave their jobs because they are burnt out or looking for a better work-life balance. Companies should recognize the importance of this and work to create policies that support employee well-being.
  • The need for flexibility: The pandemic has shown that numerous jobs can be done remotely, and good employee experience is tied to flexible work arrangements. Hiri should be open to flexible work arrangements to accommodate their employees’ needs.
  • The value of employee benefits: Good employee benefits can be a significant factor in attracting and retaining employees. Companies should review their benefits packages and consider adding or expanding benefits such as health insurance, retirement plans, and paid time off.
  • The importance of communication: Good employee communication between companies and their  employees can help build trust and improve employee engagement. Companies should prioritize continuous communication  with their employees and create a culture that values transparency and open communication.
  • The need for upskilling and reskilling: Many employees leave their jobs to pursue other opportunities or start their businesses. Companies should invest in upskilling and reskilling their employees through employee development programs to help them adapt to changing business needs and retain valuable talent.

Emphatically, the Great Resignation should serve as a wake-up call for companies to reevaluate their practices and policies to create a more supportive and engaging workplace culture that values employee well-being, flexibility, and growth opportunities.

The word growth word on wooden blocks

How it affects employees

The Great Resignation can significantly affect employees, both positively and negatively. Here are some of how employees may be affected by this trend:

Positive Effects:

  • More job opportunities.
  • Changes in company culture potentially lead to improved work-life balance, remote work options, and other benefits.
  • Greater job satisfaction for employees who remain in their current jobs and see positive changes in their workplace culture.

Negative Effects:

  • Increased competition for open positions.
  • Pressure to stay in current jobs to avoid the uncertainty of job-hopping during a period of instability.
  • Potential loss of job security if employees leave their jobs without a clear plan for their next steps.

While it may provide more job opportunities and lead to positive changes in workplace culture, it can also create increased competition and pressure to stay in current jobs.

Strategies to deal with the Great Resignation

The Great Resignation has created challenges for companies to attract and retain talent. Here are some strategies that companies can use to deal with this trend:

  • Offer competitive compensation: To attract and retain top talent, companies should offer competitive compensation packages that include salaries, bonuses, and benefits. Also, companies should respect employee value propositions.
  • Create a positive workplace culture: A positive work environment that values employee well-being and engagement can help companies retain employees. This could include offering flexible work arrangements, opportunities for career development, and promoting work-life balance.
  • Offer career growth opportunities: Employees seek opportunities to grow their skills and advance their careers. companies should provide training, upskilling, and reskilling opportunities to help employees develop their skills and advance their careers within the company.
  • Be transparent: Companies should communicate regularly with their employees about the company’s state, plans for the future, and changes in policies and procedures. This can help build trust and improve employee engagement. Hence organizations should adopt a modern intranet system that boosts communication.
  • Improve employee benefits: Offering comprehensive benefits packages, including health insurance, retirement plans, and paid time off, can help companies attract and retain talent. Employee advocacy should be a top priority!
  • Be open to flexible work arrangements: The pandemic has shown that digital jobs are possible remotely, and employees expect more flexibility in their work arrangements. Companies should be open to flexible work dispositions to accommodate their employees’ needs.
  • Focus on employee well-being: Companies should prioritize well-being by offering mental health resources, stress reduction programs, and other wellness initiatives.

Companies need to be proactive in responding to the Great Resignation by offering competitive compensation packages, creating a positive workplace culture, and providing career growth and development opportunities.

Companies can retain their talent and thrive in a competitive job market by prioritizing employee well-being and investing in them.


The Great Resignation is a significant trend that has impacted the job market and the economy. Companies must adapt to the changing demands by prioritizing employee retention and satisfaction, offering flexible work arrangements and benefits, and building a positive company culture.

Prescriptive analytics shows that companies who comply can attract and retain top talent and maintain a competitive edge in today’s digital transformation era. Simpplr shows you more unimaginable possibilities about how your organization can cope with the Great Resignation.