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The road to the Great Resignation was paved well before COVID, and corporate America needs to own it

February 2, 2022, 10:31 PM UTC

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One thing I can’t help but notice about the rapidly shifting labor market (a.k.a. “The Great Resignation”) is the way business executives are treating it like a natural disaster – as if people leaving en masse is just a highly unfortunate, random occurrence.

The reality is that the business world has played a very large role in creating the conditions that made The Great Resignation possible. Many corporate recruiting and management strategies that have become commonplace are incredibly unfriendly to workers, but so beneficial to the bottom line that companies are willing to do it.

Though these strategies created a lot of frustration, employees couldn’t do much about it.

Even today, applying for jobs is a pretty grueling and sometimes degrading experience. Before the pandemic, it was worse. Job applications are unnecessarily complicated. You have to create an account and then type out your entire job history even though it’s on your resume. Applicant tracking systems made sure that most applications weren’t even viewed by another human. Doing interviews virtually was a non-starter.

Leading companies have been making their recruiting processes friendlier. Many others are starting to as a result of their current talent woes.

Because of more user-friendly recruiting and the fact that employees can now interview virtually for jobs all over the country – or even the world – people are realizing that they can switch jobs much more easily than before. The immense friction of changing jobs has gotten much better, and it’s opening up the market.

Before COVID-19, this friction was a key tenet of any company’s retention strategy. In the five-days-at-the-office lifestyle, how does one easily do interviews? What if they have an interest or need to move to another city?

In my previous jobs, I’ve used PTO to interview elsewhere. Another time, after interviewing at a company nearby, I returned to my office in a tie and slacks—we had a casual dress code—it was a dead giveaway. Those days are gone.

Job searching was so hard and awkward that most people reached a stasis of begrudging acceptance with their current jobs until someone would literally come to them with another opportunity, usually a friend, former colleague, or a third-party recruiter. Not anymore.

The friction of job searching has almost completely gone away. Every single company was leaning on this friction as a retention crutch. That’s why your retention strategy needs a serious overhaul.

Last, and perhaps most discouragingly, is the disconnect between leaders and regular employees, and an even wider chasm between them and hourly workers. When employees leave, leaders are prone to making excuses, as in the case of NPR, who recently had a large exodus and blamed external circumstances instead of looking in the mirror. This attitude is far more common than most are willing to admit.

On top of that, workers have more power, more ability to share info, and more detailed information about your company on Glassdoor, Fishbowl, or even Twitter and TikTok, that no practice is above scrutiny or below the public eye.

Business leaders preach company loyalty as if it’s akin to morality, but the companies have not been reciprocating that loyalty for decades, in my estimation.

It’s time for that to change.

Aman Kidwai
aman.kidwai@fortune.com

Headlines

Fortune’s Most Admired Companies list released

Hot off the digital presses this morning, the companies with the best corporate reputation in the world.

 

Flores lawsuit causes shockwaves across NFL

Former Miami Dolphins head coach Brian Flores is suing the NFL and three teams, alleging discrimination in their hiring practices.

Flores claims that one team’s executives showed up one hour late to an interview with him noticeably hungover. He also said that the Dolphins owner bribed him to lose games and pressured him to break other league rules. He was recently fired by the Dolphins despite dealing with numerous injuries and winning more games than he lost this past season.

Even though nearly 70% of its players identify as nonwhite, the NFL currently has one Black head coach. Team executives, general managers, and staff are overwhelmingly white.

The NFL’s “Rooney Rule'' (requiring all teams with a head coaching opening to interview Black candidates) and overall lack of representation in all levels of leadership are, understandably, under more scrutiny. For the NFL, this is a large fiasco that could have been avoided by paying more attention to inclusion and ethics over the years.

I’ve heard the Rooney Rule brought up as an idea to drive diversity at the board and executive levels. This high-profile example shows that requirements like this don’t work without other structural changes – the rule has been in place since 2003.

Spotify shows us nobody’s invincible 

An internet darling with tremendous growth trajectory took a big hit recently. Spotify has seen its stock price go down as the company is embroiled in social and competitive dilemmas with artists and business partners.

About a week ago, recording artist Neil Young levied an ultimatum to Spotify: remove Joe Rogan’s podcasts or he would be leaving the platform. Young cited Rogan’s COVID misinformation as the reason for his discontent. Spotify chose Rogan, and saw its stock price tumble as a result. It has since recovered slightly but not without a lot of headaches for Spotify management. 

Even The White House has gotten involved, calling for Spotify to do more to fight COVID misinformation.

After getting as high as $267 in January, Spotify stock closed at $171 on January 27th and is currently trading around $190. Simultaneously, musicians are banding together to campaign for better pay from Spotify’s platform.

 

REI’s union busting stands against the progressive image it portrays

Workers at a REI store in Manhattan filed for a union election two weeks ago. The company has not voluntarily recognized and is engaging in typical anti-union tactics. 

REI presents itself as being progressive, in large part due to its status as a member-owned cooperative. The company also emphasizes its social and charitable contributions, in addition to profit-sharing for employees. But workers cited lack of COVID safety measures and coworkers being pushed out among the reasons for forming a union. 

 

Facebook launching a career pathway program for HR

Meta is looking for people with “experience in sales, customer support, communication, or related fields” that might be interested in pivoting into recruiting - an interesting idea.

 

Google paid leave and vacation policies may show where we’re heading

Since many in the tech world take their cues from this titan, Claire Zillman of Fortune takes note of Google’s paid leave and vacation policies and what they mean for the future of work.

One good idea

The right to fail

In the conversation around culture and psychological safety, one of the most important elements for developing the right environment is giving people the right to fail. Sometimes people, especially those from underrepresented groups, are judged more harshly for making a simple mistake, while others have it treated as a “learning experience.”

Everybody needs to have the right to fail. This concept is not new, famous Georgetown basketball head coach John Thompson outlined as much in this clip from the 90s.

Another compelling example of the success of this approach is evident in a recent documentary, The Orange Years on Hulu. It chronicled the rise of Nickelodeon, the globally-popular children’s television network, during the 1980s and 90s.

A few things stood out from this: the company’s leadership across business and creative teams was gender balanced in a way most networks could only dream of back then, and second, Geraldine Laybourne, the company’s president from 1984-1996, gave her teams lots of creative freedom. This was a really enjoyable documentary and offered a lot of interesting details on how to build teams and create an environment that enables company success.

Numbers that matter

5

In Okta’s recent report on enterprise app usage, five of the top ten fastest growing ones were collaboration tools, for the first time ever. Those five tools are Notion, Figma, Miro, Airtable, and monday.com.

Okta notes that overall, the categories that support remote work are the fastest growing: design software (39% year-over-year growth), electronic signature tools (38%), and cloud platforms (34%). Employee engagement tools are also hot, led by Culture Amp and Lattice, according to the report. Workday remains the top HR platform, but BambooHR grew over 40% last year.

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