From “Great Resignation” to “Great Renegotiation”

In this article, we explore the underlying trends driving the “Great Resignation” and the implications for organizations as workers’ expectations, boundaries, and priorities continue to shift. Featuring Ivey Academy Professor Martha Maznevski. What does the future of work hold, and how should leaders prepare to adapt?

Defining the “Great Resignation”

The “Great Resignation” was coined to describe a marked rise in resignations over the past year, across multiple industries and countries.

Part of this perceived increase can be attributed to the fact that, over the first year of the pandemic when the job market was difficult and many companies had to perform layoffs, employees who may have been interested in resigning temporarily postponed leaving their current roles. What then appeared as mass resignations were a delayed but normal pattern.

The more interesting and significant long-term issue to address is the rise in intent to resign.  According to StatsCan, Canada has not yet seen a significant rise in the job switching rate, though recent surveys by Robert Half show that nearly a third of Canadian workers plan to look for a new job in the first half of 2022. Many organizations are starting to see a clear signal: workers are unhappy with their status quo.  There are many possible factors that might explain this trend toward discontent – employees struggling with work-life balance, ineffective or disconnected leadership within an organization, rigid office structures, pay not meeting expectations — and while those issues may be nothing new, the current business landscape has held them under a much closer microscope.

Over the past two years, the onset and continued effects of the global COVID-19 pandemic highlighted many organizational challenges. Workers in frontline positions faced unprecedented pressures and high stakes; often ending up overworked and forced to operate under very real hazards to their health and safety.

However, job dissatisfaction was not only limited to frontline roles. Workers across many industries, including those in traditional office jobs, also experienced elevated levels of burnout during the pandemic as they navigated the competing pressures of remote work dynamics, homeschooling, shifting job expectations, and a lack of social support.

Attitudes around work are shifting on a large scale

Martha Maznevski, Ivey Business School Professor and Faculty Director at The Ivey Academy, offers insight: “There was so much uncertainty and stress around COVID. There has been a lot of research on the populations and the segments for whom the pandemic has been the most unsettling and stressful, but that is relative — it has been unsettling and stressful for everybody. Many people are disengaged from the psychological contract with their organizations that existed before the pandemic, because their own priorities have shifted.”

The COVID-19 pandemic and the drastic disruption it caused in the lives of people globally had a dramatic impact on how people see work, causing many workers to re-evaluate what matters to them.

“People reprioritized: it’s not necessarily that they changed their values, but people tend to prioritize values and put boundaries both at work and at home. COVID made people reorder and shuffle, and many realized that they are not willing to sacrifice certain things,” says Maznevski.

In stark contrast to the career-first culture that permeated attitudes towards work in North America for decades – particularly among younger workers – people are now starting to prioritize their personal mental and physical well-being, families, relationships, and, more generally, their lives outside of the office. The pandemic, through its devastating impact, forced many people to adapt and shift their perspectives away from traditional assumptions around work.

For example, despite a widespread acceptance that large-scale work-from-home arrangements could not be feasible for most organizations, office workers were suddenly thrust into that situation by necessity, very quickly proving their ability to adapt and perform their roles remotely. Leaders at all levels are now forced to examine what other parts of ‘normal’ work life are truly beneficial to the organization and its employees. Organizations are now reflecting on a broad range of long-held assumptions and examining the potential to create more inclusive, accessible, and supportive systems that actively enable employees to find balance.

“Everything that individuals have learned over the last two years about the possibilities of working virtually, we have known in the research for upwards of two decades. There are lots of things that you can do well — and sometimes even better — virtually,” Maznevski explains. “We know all the research on our brains and habits. You can’t just try something once and then know how to do it; you must repeat the action long enough to create the neural pathways until it becomes a habit or skill. During COVID, we had no choice but to change, so we learned as communities and organizations to make a transition.”

What does this mean for employers?

To retain and recruit talent despite shifting personal priorities and work habits, leaders will also need to consider other innovations. Knowing what strategies are likely to be successful comes down to understanding what exactly workers want from work.

“Good organizations are going to learn to be more flexible if they want to keep people engaged. However, it is not necessarily going to be an easy transition because there is not necessarily one right answer. The solutions are going to be different to every work environment and will also need to be dynamic: the solution today might be different to the solution next year,” suggests Maznevski.

At its core, the Great Resignation is a sign that people are looking for workspaces that prioritize the humanity of their constituents. On a large scale, we are likely to see a trend towards more flexible working conditions and a more accommodating work schedule that allows individuals to find a healthy balance between their personal and professional needs and goals.

So, what will the future of work entail? Already organizations are adopting four-day workweeks, shifting expectations around the hours workers are expected to be available, and setting boundaries about when and how employees can be contacted. Hybrid work arrangements, virtual accessibility, and other increases in work flexibility are likely to persist and evolve to better fit the needs of individuals, teams, and organizations.

However, Maznevski does not believe that in-person work will ever fully cease to exist. “There is still so much value in having in-person interactions at work. That face-to-face connection is integral in developing a sense of trust. As a colleague once told me, sometimes we just need to exchange pheromones.”

The demand for great leadership is going to increase

Naturally, these changes are going to come with challenges for organizational leaders. For example, organizations will need to manage the discrepancy between employees who can work virtually and others whose roles are dependent on being physically present. With flexibility comes tough decisions around the parameters and policies necessary to accommodate employees while still working towards united organizational goals. It will fall to individual leaders to model the behaviours they hope to see in their teams, finding both long-term alignment and in-the-moment compromise between operational efficiency and culture.

“A company can have HR policies to benefit their employees, but if managers don’t encourage people to use the policy, then it doesn’t matter,” Maznevski comments. “In fact, those policies can become hypocritical. If managers imply, for example, that if you do take a wellness leave, there might be less be less opportunity for a promotion when you come back, the modelling is there to actively discourage policy use.”

The difficulty of managing this level of change will give exceptional leaders a unique opportunity to differentiate themselves and their organizations. Amidst ongoing challenges in recruiting top talent, the teams that find a healthy and productive balance will both attract and retain their high potentials better than those that don’t continually adapt. Leadership in this area will then present a significant competitive advantage for organizations that are able to successfully navigate. Organizational policies should enable and empower individual leaders to make good decisions for their specific context.

As an individual leader, one of the keys is staying in tune with your team’s needs and values. This requires a certain level of discipline, especially in a hybrid or virtual space. Successful leaders are going to put in the extra effort to check the pulse of their team and maintain a healthy organizational “heartbeat.”

“In short, leaders really need to step up,” says Maznevski. “The importance of engagement, the importance of empowering people, understanding individuals from their own perspective empowering them to help them grow, use their strengths, and see a development path — all those things have always been part of good leadership, but now they are necessary. Because employees are now seeing shifted values, priorities, and opportunities, they are not going to stick around, perform, or be committed to giving extra effort while working with bosses who are not meeting their expectations.”

The opportunity to create influence from the bottom up

Changing expectations also gives employees an opportunity to shape the future of work in their own environments. Clearly articulating what you want and need to create alignment between your personal and professional life can help your leaders to build that critical understanding and ultimately advocate for policy change. Rather than waiting for a solution at the organizational level, individuals can be a key part of the conversation by offering their own ideas.

“I think we’re moving away from ‘work-life balance’ and more toward ‘work-life integration’,” Maznevski says. “There are lots of diverse ways to approach that—we all just need to experiment until we get good at it making it work for ourselves.”

Additional Resources:

Employee engagement tips learned from the pandemic - Ivey Business School