Americans are walking away from their jobs in record numbers, but the Great Resignation isn’t hitting every organization equally.
According to a recent study, the companies that have held on to their best and brightest in the face of widespread talent shortages have a few things in common. The analysis, which was conducted by Hired, explored 650 of the job-matching platform’s clients that were looking for technology-specific roles across industries in the U.S. and U.K. between October of 2020 and October of 2021, and ranked each based on their success in doing so.
Topping the list for American Enterprise employers is Insider Inc., followed by Maximus, Nielsen, Walmart Global Tech, and The Walt Disney Company. Recreational vehicle financing provider Octane took top honors among small American employers, while virtual home care platform Sittercity finished first for retaining tech talent among American mid-size employers, or those with 300 to 1,000 staff.
A formula for retaining talent
According to Hired’s CEO, Josh Brenner, those that have experienced the least friction in hiring and retaining talent typically have three things in common: They prioritize and recruit underrepresented candidates; they extend offers to successful candidates more quickly; and they are more transparent about compensation.
“Within the top companies that are able to attract tech talent, 23% of all interview opportunities are extended to underrepresented candidates, versus 14% of all companies on our platform,” he says. “When it comes to job offers, it’s even more extreme. Thirty-five percent of all job offers at those companies are made to underrepresented candidates, compared to 12% in our overall population of companies.”
The companies that top the list for attracting tech talent also extend offers more quickly, taking an average of 36 days to complete the hiring process, compared with an average of 40 days. As a result, those organizations receive an 84% response rate from successful candidates, far higher than the 50% response rate seen by other organizations.
“We’re also seeing that the top companies are being very consistent in the salary they offer people at similar levels; the companies that have a tighter salary variation are faring better,” says Brenner. “The deviation (in pay) is around 11% for a given role for the top companies, versus a deviation of around 16% for non-top companies. So basically, the highest performing companies are more transparent, and keep consistent salary offers for people with the same position.”
How a top employer approaches talent
One of those top performers is Insider Inc., which ranked first for hiring and retention of tech talent for companies of 10,000 employees or more in the U.S. (Insider Inc., formerly Business Insider, includes various sub-brands like Insider Intelligence, InsiderStudios, Market Insider, and Insider Events.) According to the company’s senior vice president of people and culture, Nailah Banks-Embden, Insider had an attrition rate of 10.65% in 2020, and 19.37% in 2021, well below the national average of 57.3%, which she attributes to many of the winning tactics identified by Hired.
“Something that we have made a priority and place a lot of effort around is being equitable and diverse as a company, which I think you can’t compete if you’re not,” she says. “We know diversity plus equity plus inclusion equals a successful organization, so we strive to weave that through all of our company initiatives.”
For example, Insider has established partnerships with organizations like Girls Who Code and Women In Tech, and hired a dedicated head of diversity and inclusion for the enterprise, as well as a managing editor devoted to DEI within the editorial team. Furthermore, more than half of new leadership team hires in the last year have been women or BIPOC.
The company also conducts annual salary equity studies, and made a policy of disclosing salary ranges on job postings well before it was mandated in the state of New York. Furthermore, Insider reduced the time it takes to extend an offer to a successful candidate down to just 28 days. “We often think that . . . people and turnover and retention is an HR-talent issue, but it’s no longer isolated,” says Banks-Embden. “The onus is on all of leadership to pay attention, and work together to figure out the best approach.”
Why the Great Resignation is far from over
According to the Bureau of Labor Statistics, the U.S. workforce saw four million resignations in July, a new record that was quickly broken in August—and then again in September, and October, and November, which is the most recent month for which data is available. In total, about 17 million Americans called it quits, and experts warn that the trend is far from over.
“This wasn’t a summer blip, this wasn’t some sort of readjustment and now we all go back to normal,” says Ian Cook, the vice president of analytics at Visier, a people analytics provider. “My perspective is that this is a long-term trend, that we will be in a more volatile labor market for a long time, for a bunch of reasons.”
Those reasons, according to Cook, include an aging population that is approaching retirement; the high number of Americans that left the workforce during the pandemic, and never returned; a catching-up of career moves that were delayed during the volatile beginning of the pandemic; changing lifestyle preference as a result of the rise of remote work; and a high proportion of workers in lower-wage jobs that took the pandemic as an opportunity to change roles or industries, among others.
While these factors helped kick-start the Great Resignation, however, Cook adds that it’s now got a head of steam that isn’t likely to lose momentum in the immediate future. “Because it’s a hot job market, if I’m just doing work for the money, I can now get paid better by moving than trying to convince my existing employer that I’m worth more, specifically in the tech industry and in knowledge work fields,” he says.
Looking to tech employers for solutions
While the Great Resignation has now impacted nearly every industry, tech employers have been entrenched in a talent war for decades, and are often at the forefront of developing solutions for attracting and retaining staff, says Daniel Zhao, a senior economist for Glassdoor.
“Tech companies have had this long history of knowing that they need to tackle the employee experience aggressively in order to retain workers, and I think that’s translated into this pandemic-era job market,” says Zhao. “Many tech companies have a playbook to deal with employee retention, built up over years of experience.”
According to Zhao, the tech industry has further upped its game in the face of the Great Resignation. In fact, 40% of the organizations that made Glassdoor’s list of the top 100 best places to work in 2022 hail from the technology industry, compared with just 28% a year ago.
As a result of the ongoing Great Resignation, Zhao believes an emphasis on culture, diversity, and inclusion, an engaged leadership, career growth opportunities, flexible work, and mental health resources will become a competitive advantage across all industries.
If the previous era of business was primarily focused on customer satisfaction, the next will likely be a greater emphasis on employee satisfaction, and the data is already supporting this. According to the Edelman Trust Barometer, 40% of employers put customers and clients as their top stakeholder in 2020, followed by employees, at 37%. In their May 2021 report, however, employees had overtaken customers as the most important stakeholder, with 40% of business leaders indicating they were now the top priority.
“Even before the pandemic began, our opinion was that the 2020s was going to be a culture-first decade; this is going to be a period where employers really start to emphasize employee experience across the board, regardless of what industry they’re in,” he says. “That’s been accelerated by the trends we’ve seen over the last two years.”