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The Great Resignation
In the wake of COVID, employers were coping with unprecedented turnover rates. As the COVID pandemic was winding down, workers found themselves anxious to spread their wings. Having been locked down, they wanted to break out. And break out they did - as job hopping became the new trend. As late as 2024, a Gallup poll found that 48% of U.S. employees were seeking new roles.
What a difference a year makes.
Economic uncertainties and drastically changing policies have cooled the hoppers down. Writing in Forbes, Bryan Robison says, "...as Labor Day approaches, new research shows the cooling labor market has slowed, and job hugging is gaining momentum and replacing job hopping. Job hoppers are no longer getting a big bump in salaries, and the pattern is reversing, with job huggers finding that staying put might be a safer option for now."
As reported by Bruce Crumley, writing in Inc., "All told, U.S. businesses added a mere 106,000 new jobs to their payrolls over the past three months. That was far below the 380,000 total of February through April, and well off the 186,000 monthly average in 2024. The slowing indicates companies have now reduced hiring to mostly filling recently vacated positions. Given those numbers, it’s not surprising employee quit rates have plunged to just 2 percent in recent months—the lowest level since 2016, apart from the pandemic’s outset in 2020."
Loyalty or Stagnation?
When employee turnover is low, it is tempting to attribute to a loyal workforce. And in many cases this can be true. However, under certain conditions, this simple answer may not be the right one. Things can change quickly in today's economic and policy climate.
Low turn-over is a common goal among employers. On-boarding new workers is expensive, time-consuming, and often results in a lose of productivity, at least initially. So, with your workforce staying put, you are in an enviable position. However, it is important to recognize and appreciate what is happening.
Signs of Job Hugging
Jennifer Schielk, CEO and confounder of Summit Group Solutions and author of "Leading for Impact: The CEO's Guide to Influencing with Integrity, describes job hugging as a red flag and lists several signs that surface with it.
- Increased stress that may affect the behavior or the mood of the team.
- Performance changes where someone focuses on areas in their role that they're good at to highlight their capabilities versus the critical areas that best serve the whole of the team or the most important initiative.
- Employees eager to assist in other roles or opportunities which can be helpful for the team, if they can continue in their own position with excellence.
- Workers who have outgrown their current roles, sitting in the wrong seat at this time in their careers and clinging to it because of market fear.
You Have an Opportunity
The labor market may have slowed, but it won't stay that way. When the market shifts, you need to have a plan. Right now is the time to invest in your workforce. They aren't going anywhere, and if you do things right, they won't be leaving when the market turns around.
Schielke notes leaders should take this moment to double down on development, mentorship and growth. “Employees may not be moving jobs, but they still need to move forward,” she says. “Great leaders will recognize that stability is not the same as engagement and use this time to build a stronger culture that lasts beyond the current market.”
Bryan Robinson, Ph.D., writing in Forbes, related a conversation he had with Tara Ceranic Salinas, professor of business ethics and the department chair of management at the University of San Diego's Knauss School of Businss. This is what professor Salinas had to say.
"“Leaders need to acknowledge that this is a challenging time for everyone, and then they need to act,”... “Companies that legitimately want to foster engagement must invest in their culture and prioritize empathy and humanity beyond talking points.” Here are other ways employers can address job hugging.
- Check in with your employees. Salinas recommends establishing regular opportunities to share honest feedback and following up to show what was done to address the feedback. Schielke believes recognizing job hugging gives leaders a chance to engage with teams and understand their fears, needs and drivers.
- Invest in the growth of employees. Schielke encourages employers to show employees that you care about investing in their growth whether it’s within or outside the walls of the company. She stresses the importance of thinking about how to create stability, security and connection for your people during a time of tremendous uncertainty. Salinas says offering additional training, mentoring or career development pathways can make employees feel valued and less stuck.
- Reintroduce flexible schedules. “Flexibility has recently been removed from workplaces with forced return to office,” Salinas says, “but we know how unhappy it makes employees. Companies that are willing to reintroduce flexible schedules and hybrid work show that they understand what their employees want.”
- Be a model of empathy. Salinas insists vulnerability is key to being a good leader and building a resilient culture. She advocates for leaders to share their own experiences and frustrations. Schielke says leaders can make that happen by sharing industry news and articles and have a Q&A or open conversation time in a daily meeting or coffee chat where people can engage and talk about concerns.
- Explain company vision. Schielke recommends employers help each person understand the direction of the company and share how their roles integrate into that vision and what critical elements or key metrics employees need to see."
ASN Can Help
As professionals, our staff is always following market trends, tracking the current business environment, as well as anticipating not only what tomorrow may bring, but how to meet this challenges and thrive. If you would like to have a conversation about how to plan ahead for success, we would love to talk with you. Just give us a call.
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