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Is 2022 Australia’s Year of the Great Resignation?

You’ve probably seen the headlines – a global ‘Great Resignation’ is supposedly underway as workers quit their jobs in droves to look for better pay and conditions in the wake of the pandemic.

Resignation2The Great Resignation is a phenomenon that predicts people will voluntarily leave their jobs in record numbers as the pandemic encourages a rethink of careers, work-life balance and long-term goals.

This occurs just as the economy re-opens and demand labour increases.

In some countries, there is evidence this is indeed occurring.

In the US, workers have quit their jobs in record numbers as the economy started reopening and the pandemic enabled them to rethink their careers, work-life balance, and long-term goals.

As our economy begins to open after two years of disruption, has Covid also rewritten the rules for local workers?

The NAB recently looked into this and released a report by Dean Pearson and Robert De Jure. Here's what it had to say....

What about Australia?

After more than 2 years of COVID disruptions should businesses prepare for a seismic shift in the workforce?

Burn OutOpinions vary with some predicting millions of burnt-out workers will leave their current employment, while others have dismissed the phenomenon with no evidence of similar attitudes here.

For their report, NAB asked over 1,200 Australians working full or part-time about their employment behaviours, attitudes and intentions.

The findings suggest after decades of low employee turnover there is indeed a very sizeable share of the adult working population who have left or are considering leaving their current job.

Just over 1 in 5 Australians have changed jobs within the last year and almost 1 in 4 are considering leaving their current place of employment.

Over 1 in 3 Australians considering changing jobs said COVID has had a big impact on their decision.

Importantly, the survey also finds that many of the key reasons workers are contemplating leaving their jobs are “push” factors - a lack of personal fulfilment, purpose or meaning, lack of career growth, mental health, poor pay and benefits.

Many Australians who are considering changing jobs are also looking for a fresh start, with around 3 in 10 planning to move to a different or new role in a new industry.

NAB’s research suggests more must be done by employers if they wish to retain their staff, particularly in some sectors.

Results are based on the responses of over 1,200 working Australians during the survey period 25 November to 13 December 2021.

According to NAB’s results, just over 1 in 5 (21%) Australians have changed jobs within the last year.

Fig01Almost 14% did so in the last 1-2 years, 23% in the last 2-5 years, 16% within the last 5-10 years and 25% more than 10 years ago.

To put this in context, this increase in resignations comes after unusually low levels of employee turnover in Australia.

TurnoverIn fact, Australia experienced the lowest employee turnover since the Australian Bureau of Statistics (ABS) started tracking labour mobility in 1972.

The most recent ABS data suggests 7.5% of employed people (around 1.1 million) changed jobs in the year to February 2021 - down from a peak of 19.5% in 1988-89.

Note, the ABS series captures labour mobility for the civilian population aged 15 years and over, while NAB’s survey focuses on a more representative sample of the adult population aged 18 years and up.

Increased labour mobility is a natural part of the economic cycle - when jobs become more abundant, the number of people leaving their jobs also rises as opportunities improve and competition for workers increases.

That said, NAB’s results suggest the cycle is also being impacted by behavioural factors due to COVID.

A much larger share of part-time employees indicated in NAB’s survey that they had changed jobs within the last year (24% vs. 19% for full-time workers).

Fig02

By age, younger workers (18-29) were much more likely to have changed jobs in recent years, particularly within the last 12 months, compared to older employees (33% vs. 18% in the 30-49 age groups, 13% in the 50-64 groups and 5% among those over 65).

Fig03

NAB’s survey also shows job turnover was greatest for general unskilled workers, with almost 4 in 10 (37%) indicating they had changed jobs in the past year, followed by labourers (29%) and other IT & technology workers (28%).

By industry, job turnover was highest in Agribusiness (31%), Health Services (25%), Finance & Insurance Services (25%), Retail (24%) and Property Services (24%).

What of the future?

Almost 1 in 4 (23%) adult Australians are considering leaving their current place of employment, on average in 4.3 months’ time.

Interestingly, a greater share of full-time workers are considering leaving their job over the next year (24% vs. 18% of part-timers).

Fig04

By age, again younger people are more likely to be considering a change (28%), but a sizeable share of workers aged 30- 49 (23%) and 50-64 (17%) are also considering doing so.

Fig06

By state, turnover is likely to be highest in the ACT (30%) and TAS (29%).

By employment type, around 3 in 10 managers (29%) and sales workers (28%) are considering changing jobs, compared to just 16% of clerical & administrative, community & personal services workers, 18% of trade workers and 19% in other IT & technology.

Fig05

By industry, consideration is highest in Agribusiness & Construction (38%) and Utilities (35%).

Almost 1 in 2 (46%) people working in Wholesale and 4 in 10 in Government (42%) and Manufacturing (40%) are not considering changing jobs or monitoring the jobs market, compared to just 13% of workers in the Utilities and 18% in the Telecommunications sectors.

There are a number of theories why the Great Resignation might be happening.

Great ResignationThese include:

  • a heightened sense of mortality and a shift in priorities;
  • burnout due to extra work (particularly among frontline “essential’ workers) or dissatisfaction with treatment during the pandemic;
  • a reluctance to return to the workplace after working remotely;
  • and a strong rebound in the labour market providing confidence in finding another job when returning to employment.

NAB also wanted to understand why Australians were considering changing jobs.

The key reasons were mostly “push” rather than “pull” factors, though a host of additional emotional and lifestyle issues also seem to be playing a role.

On average:

  • around 3 in 10 workers indicated they were being pushed away from their current jobs by a lack of personal fulfilment and purpose or meaning (30%),
  • lack of career growth (29%),
  • the impact of their current job on their mental health (29%) and
  • poor pay and benefits (27%).

Job ChangeAround 3 in 10 wanted a change (29%).

Other key drivers included poor work-life balance (23%), burnout (22%) and feeling like a fresh start (20%).

There were some key differences by state, role and industry.

A much higher share of workers in QLD (48%) cited mental health as a key driver of change, in WA poor pay and benefits (47%), burnout in the other states (33%) and employers failing to recognise pandemic concerns in VIC (18%).

By industry, over 1 in 2 workers in Wholesale (55%) and Mining (52%) cited lack of personal fulfilment and purpose, and those in Hospitality (55%) and Manufacturing (50%) lack of career growth.

Over 6 in 10 workers in Government (62%) and Recreational & Personal Services (62%) pointed to a desire for change, and around 1 in 2 in Health Services (54%), Education (51%) and Mining (48%) the impact on their mental health.

001Noticeably more people in Property Services cited poor pay and benefits (57%), in Transport/Storage poor work-life balance (46%), and in Recreational & Personal Services (39%) and Health Services (38%) burnout.

Wanting more time with their family was most important in the Utilities (44%) sector, lack of diversity & inclusion in Mining (51%) and employers failing to recognise pandemic concerns in Telcos (38%).

Most Australians who are considering changing jobs are looking for a fresh start, with around 3 in 10 (31%) planning to move to a different or new role in a new industry or move to a different or new role in the same industry (27%).

Just over 1 in 5 (22%) plans to move to a similar role in the same industry, and 17% to a similar role in a new industry.

Nearly 1 in 5 (17%) will take a career break and 14% work less or start a business.

Around 1 in 20 (6%) are unsure, while 1 in 25 (4%) plan to do other things like study, travel or retire.

By state, nearly 4 in 10 (38%) people in VIC plan to move to a new role in a new industry, compared to just 1 in 5 (18%) in WA.

002By job type, a much higher number of labourers plan to move to a new job in:

  • a new industry (59%),
  • machinery operators & drivers to a different role in the same industry (53%),
  • digital & data workers to a similar role in the same industry (40%) or similar role in a new industry (77%),
  • general unskilled workers and machinery operators & drivers work less (33% & 32% respectively), or
  • start a business (24% and 23% respectively).

By industry, a much larger number of people working in

  • Wholesale (64%) and Retail (56%) plan to switch to a new role in a new industry,
  • in Education (48%), Agribusiness (48%) and Utilities (44%) to a new role in the same industry,
  • in Construction (46%) and Utilities (41%) to a similar role in the same industry,
  • in Mining (52%) and Wholesale (44%) taking a career break,
  • in Property Services (32%), Business Services (30%), Utilities (30%) and Telcos (30%) moving to a similar role in a new industry, and
  • in Mining starting a new business (52%) or
  • for other reasons (24%).

Finally, Australians who were considering changing jobs were asked to rate the extent to which their experience during COVID had influenced their decision.

003Over 1 in 3 (36%) said it had a big impact on their decision, rating it 8 pts or higher.

The impact was biggest for other IT & technology workers (7.4 pts), followed by managers (6.8 pts), digital & data workers (6.2 pts), professionals (6.2 pts), general unskilled workers (6.1 pts) and labourers (6.0 pts).

Its influence was smallest by some margin for community & personal services workers (2.5 pts), followed by machinery operators & drivers (4.0 pts), trades workers (4.2 pts), sales workers (4.4 pts) and clerical & administrative workers (4.7 pts).

By industry, the COVID impact on their decision to change employment was biggest in Telecommunications (7.3 pts) where 3 in 4 workers also rated its impact very big, Construction (7.3 pts) and Property Services (7.3 pts). It was lowest for workers in Education (3.8 pts) and Retail (4.5 pts).

ALSO READ: Is suburbia’s global benchmark share of urban jobs 87%?

About Kate Forbes is a National Director Property Strategy at Metropole. She has 15 years of investment experience in financial markets in two continents, is qualified in multiple disciplines and is also a chartered financial analyst (CFA).
Visit Metropole Melbourne
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