Although each industry has experienced its own employee turnover pains over the past few years, there are some cornerstone issues which seem to have influenced turnover rates across the board.
Flexible and remote work opportunities increased, but not everything went smoothly
The rate of remote work rose to 26% of all employees in 2022, which is a record high. Additionally, 16% of all U.S. companies are fully remote. But this uptick in remote work arrangements comes with a certain level of friction.
Gartner found that 70% of employees believe remote workers get paid less and are less likely to be promoted than their on-site counterparts. On top of that, 68% of employees who could work remotely have been required to return to the office in some capacity.
This is true despite the fact that, according to analysis by ADP Research Institute, 64% of the global workforce has already quit, or would consider doing so, if they were required to return to the office full-time.
Piers Hudson, senior director of Gartner HR, explains:
“Leaders’ efforts to restore the organization’s ‘normal’, pre-pandemic way of working are clashing with a workforce that has largely normalized working in a hybrid environment.”
Although it’s still too early to tell how this tension will impact employee turnover rates in the long term, it may explain some industry-specific turnover, particularly in sectors where remote work has become the norm.
Cross-industry mobility is high
Research by McKinsey found that, among workers who quit their jobs between 2020 and 2022, 48% moved to a different industry.
Burnout is one of several factors that likely contributed to this. Three years into the pandemic, industry-specific burnout still looms large in some sectors, namely healthcare and education.
According to the US Bureau of Labor Statistics, nearly 1.7 million people quit their healthcare jobs in the first half of 2022 alone. This is the equivalent of 3% of the entire healthcare workforce turning over each month. Employee turnover numbers in the education industry tell a similar story. Bloomberg reports the number of teachers who quit their jobs in 2022 was nearly 41% higher than in 2021.
A labor shortage in many industries is another factor likely contributing to cross-industry mobility. As employers widen the net to attract candidates, many companies have dropped four-year degree requirements for mid-level positions, giving workers new options previously unavailable to them.
The Federal Reserve Bank of Philadelphia estimates that 700,000 positions have opened up to those without degrees over the last two years.
Economic concerns prompted some to seek new jobs
72% of workers who received a raise in the first half of 2022 reported that their raise was less than the 8.5% of the inflation rate. Additionally, 80% of job seekers believed the U.S. would enter a recession within the next year, and 60% of workers felt the job market would get worse over the next six months.
This likely prompted some employees to seek new jobs for greater pay and more financial stability, in anticipation of harder times to come.50% of employees who planned to quit their job in 2022 reported better pay and benefits as their primary motivation. This trend dovetailed with the cross-industry mobility, as many employees changed industries, not just jobs, for better salaries.
