- What’s Causing the Great Resignation?
- How to Manage the Great Resignation
- How to Respond to the Great Resignation
Once your organization has a great team assembled, you want to do whatever you can to keep your employees working for you. A solid accounting team is particularly important for ensuring your organization pays its bills on time, gets paid on time, and manages its fundraising activities efficiently.
In 2021, many companies and organizations experienced a significant shake-up concerning employee retention. The number of employees who quit each month continued to climb throughout the year. In November 2021 alone, 4.5 million people quit their jobs, according to data from the Bureau of Labor Statistics (BLS). The phenomenon has been dubbed the “Great Resignation,” and it’s left many organizations scrambling to fill roles and hire new employees.
If you’ve seen an uptick in employee turnover during the past year, here’s what the Great Resignation means for your organization and how to cope with it.
What’s Causing the Great Resignation?
A lot of ink has been spilled about the causes of the Great Resignation. Some commentators argue that people are quitting their jobs because they are burnt out and tired. Others say that people are leaving jobs to pursue better wages and more benefits.
All of those reasons are likely accurate, but it boils down to numbers at the end of the day. BLS reported 10.6 million job openings, compared to 6.3 million unemployed people. More jobs are available than people looking for work, putting workers at an advantage. A person who might previously have worked for an organization that didn’t pay well or that didn’t fully engage them can now decide to leave that post in search of better employment options.
The increase in available jobs compared to the number of people looking for work is attributable to several factors. One contributing factor might be that many people who considered quitting before the COVID-19 pandemic chose to keep their jobs longer. Instead of resigning in 2020, they waited until 2021.
Burnout is another contributing factor. The Harvard Business Review reports resignations are highest in two industries — healthcare and technology. Many working on the frontlines in medical settings in 2020 and 2021 are physically and emotionally exhausted by the demands placed on them. The tech industry is also known for being fast-paced and stressful, and the pandemic likely increased those demands in new ways.
Some people might have decided to quit their jobs after making decisions or coming to realizations about their lives during the pandemic. For many people, working remotely allowed them to achieve a better work-life balance. Faced with the possibility of returning to the office from a work-from-home situation, some might decide to look elsewhere for employment.
How to Manage the Great Resignation
It’s often much better for organizations to keep their current employees than to have people quit. A high retention rate helps lower costs, as you spend less on hiring and onboarding new team members. It also keeps employee morale up and boosts engagement among workers. The longer your employees work on the accounting team, the more skilled they become in their jobs, meaning the managerial staff spends less time supervising them.
If your accounting team or organization as a whole has been affected by the Great Resignation, looking at the numbers and understanding why people are leaving can help you get a handle on it.
Calculate Your Turnover Rate
The first thing to do to understand the Great Resignation’s impact on your organization is to calculate the turnover rate. You can calculate the rate on a department basis or for your organization as a whole. For example, you might calculate the turnover among members of the accounting team.
To find the turnover rate, divide the number of annual separations by the average size of your team. For example, if there are typically 10 people working on your accounting team and two left in 2021, your turnover rate is 0.2, or 20%.
You can fine-tune the turnover rate even more. For example, one of the people who left the accounting team in 2021 got laid off, and the other quit. That means your voluntary separation or quit rate is 10% or 0.1.
Once you know your turnover rate, you can identify how it’s affecting specific metrics. The remaining team members will have to take on the tasks performed by the people who left, meaning projects get delayed, or payments get made late.
How to Respond to the Great Resignation
Once you’ve seen how the Great Resignation affects your accounting team, you can take steps to respond to it and encourage your team to keep working with you.
Create a Flexible Work Environment
The first step is to make your organization an attractive organization for employees. One way to do that is by giving employees flexibility. Even if you have mostly returned to on-site work, consider giving people the option of working from home, at least on some days of the week. A flexible workplace allows employees to take care of the demands of life, such as picking up the kids at school or walking their dogs, without feeling overburdened.
Technology makes it easier than ever for your organization to adapt to a hybrid work environment. For example, you can switch from on-premise accounting software to cloud-based fund account software. MIP Fund Accounting® software is a web-based SaaS solution designed with the unique accounting needs of nonprofits in mind. Your team can access it from any internet-connected device, meaning more of your team members can work from home more frequently.
Adjust Your Company’s Culture
Another way to respond to the Great Resignation is to look at your organization’s culture. Do your team members feel compelled to work long hours or pull all-nighters before tax deadlines or during fundraising campaigns?
If so, the culture might benefit from a reset. Consider your organization’s mission when adjusting your culture. Ask how you can realign employee expectations to fulfill your mission better. You might start acknowledging individual contributions or milestones, for example.
Another thing to consider is how long it takes people to get promoted or earn raises. Increasing transparency about promotions can help employees feel like valued team members and help them understand what the future holds for them on your accounting team.
Try MIP Fund Accounting® Today
MIP Fund Accounting® is a cloud-based solution that helps your organization achieve its mission, helping you retain employees. If you’re interested in adopting cloud-based accounting software and want to offer your team members the option of working remotely, schedule a demo of MIP today to see how it can work for you.