Employees—whether hotel workers or investment bankers—are quitting, and superficial “wellness programs” aren’t going to reverse it
By Thierry Malleret, economist
A recent report from McKinsey that surveyed employers and employees in Australia, Canada, Singapore, the UK, and the US to investigate the “Great Resignation” (or “Great Attrition”) phenomenon found out that 40% of the employee respondents are “at least somewhat likely to quit in the next three to six months.”
Several causes lie behind the “Great Resignation” trend (such as low pay and bad working conditions), but it almost always contains a strong wellbeing component: Workers leave the workforce because they are dissatisfied with what it offers. They don’t find purpose or meaning in their work or think that their working environment and habits negatively impact their sense of physical and mental wellbeing.
At one end of the spectrum, too many people don’t earn a living wage despite providing essential but under-valued goods and services (as in the gig economy)—consequently they suffer from a lack of elementary financial wellness, which makes holistic wellbeing a pipe dream. At the other end of the spectrum, there are those people who make a very good wage, but in conditions that are detrimental to their wellbeing. In such cases, companies often implement “wellness programs” which often equate to sticking a band-aid on a wooden leg doing little or nothing to address the root causes of the problem.
Current practices in law firms are a glaring example (investment banks, too). In the UK, a study conducted by a legal mental health charity showed that almost 70% of all the lawyers surveyed in recent months had experienced serious problems of mental health and wellbeing, primarily because their work required them (for almost 30% of respondents) to be available to clients 24 hours a day, and that they (12% of respondents) averaged fewer than five hours’ sleep a night.
How did the law firms respond? By hiring more lawyers to reduce the workload of the existing ones? Or by putting into place policies that cap the number of working hours spent at the office or on the computer? No. Some firms set up “mental health task forces” and started offering a free counselling service for lawyers and their families. Others begun offering wellness programs, such as a “wellness hour” with a yoga course and access to Peloton fitness bikes. All raised the starting salaries of their junior lawyers.
It’s too early to tell whether the lure of more money and “cosmetic” wellness measures will work but anecdotal evidence seems to indicate that in the post-pandemic world, genuine wellbeing aspirations with work will increasingly matter (many young lawyers and investment bankers are quitting). This is in part what the “Great Attrition” is all about—a wellbeing reckoning taking its revenge!
The McKinsey findings on the incredible number of employees likely to quit are broadly consistent across industries, but the report makes it plain that the leisure and hospitality industries are the most at risk of losing employees (because they pay less and impose relatively harsher working conditions than other sectors). The solution, as President Biden has advocated is: “Pay them more!”. Yes of course: but this is not always easy to do in low margin businesses.
