Study Shows People Are Quitting Because Your Workplace is Toxic

"The Great Resignation is just filled with a bunch of people who don't want to work," said a hiring manager. As I cringed a little inside, I thought to myself the hiring manager almost had it right, they just forgot the end of that sentence, "The Great Resignation is filled with a bunch of people who don't want to work dealing with the same bullsh*t from before the pandemic." While I wanted to stick it to this manager for thinking people had just became lazy over the pandemic, I thought to myself...I don't have a solid answer as to why it's happening. Some people say burnout, others say compensation...but at this point it was all speculation on little data.

Just this week, The U.S. Department of Labor's JOLTs report revealed roughly 4.3 million people quit their jobs in January. I spoke with a few recruiters about this data and the feedback I received was similar - this high demand in labor is pushing employers to pay more to compete for proficient candidates, which is also simultaneously pulling workers away from their current positions. This only made me more curious, is it really all about the money? According to this compelling article by Donald Sull , Charles Sull , and Ben Zweigh it is NOT all about the money.

Their article, "Toxic Culture is Driving the Great Resignation," in the MIT Sloan Management Review dives deep into qualitative research to discover what is driving the Great Resignation. The data they uncovered is incredibly persuasive and I am going to highlight some of the findings for you. If you're interested in reading more about their methodology and how they controlled for attrition rates in different industries read the full article here .

So Why Are People Leaving Their Jobs?

The study above revealed the main thing driving the Great Resignation is a toxic corporate culture, people are done putting up with it and honestly...good for them. Not only was toxic corporate culture by far the strongest predictor of industry-adjusted attrition, it is "10 times more important than compensation in predicting turnover." Did you read that slowly enough for it to sink in? 10X more predictive than compensation!

Okay, but what does “toxic workplace” really mean?

The term "toxic" gets tossed around to describe a lot of different behaviors, but how did the data define a toxic work culture? Here are what they call the “Toxic Five.”

1. Non-Inclusive - Being treated unfairly because of your identity (LGBTQ, race, gender, etc.). This was the largest single predictor of a negative review.
2. Disrespectful - People reported feeling as if their employer treated them like a "cog in the machine," "treated like an animal or insect." The key theme in these reviews were the employee felt dehumanized by their employer.
3. Unethical Behavior - Dishonest, failure to comply with regulations, low integrity.
4. Cut-Throat - when people are going out of their way to undermine one another.
5. Abusive Managers - doubt I need to explain this one...

These toxic environments are costing money and lives. The American Institute of Stress claims that workplace stress costs about $300 billion each year. Moreover, Goh et al. (2015) "find that more than 120,000 deaths per year and approximately 5%–8% of annual healthcare costs are associated with and may be attributable to how U.S. companies manage their work forces." What I found ironic about their findings of the "Toxic Five" was that so many companies declare their "core values" as: respect, diversity, collaboration, and integrity…the opposite of the toxic five.

What Can You Replace These Toxic Five With?

1. Respect - how do your actions (as a leader or workplace) communicate respect?
2. Diversity - is your leadership/workplace display diversity? Diversity can mean many things - are there a wide range of interests, backgrounds, experiences, gender, ethnicity, age, etc.?
3. Collaboration - are there opportunities for people to work together for a common purpose? Is collaboration encouraged in your workplace?
4. Integrity - do you say what you mean? Are you honest?

What Can You Do to Improve Retention Short-Term?

I don’t want to be all doom and gloom here, there are some short-term ways to boost retention (Sull et al., 2022) as you put in the work to shift or rebuild your workplace culture.

1.?Provide Lateral Job Opportunities – not everyone is looking to climb the ladder, some want to try something new, a change in pace.

2.?Sponsor Corporate Social Events – these types of social events are associated with higher rates of retention. It doesn’t have to be fancy; the focus is giving people a place to connect with each other.

3.?Offer Remote Work Options – When employees felt like they had remote work options, they were less likely to quit.

4.?Make Schedules More Predictable - Having a predictable schedule is six times more powerful in predicting employee retention (front-line workers)

What About Long-Term Retention?

Restructure your mindset about leadership to be proactive instead of reactive. Invest in your employees’ well-being and development BEFORE there is an issue, not after they’ve endured months or years of toxicity. Too many executives I speak to about leadership and development trainings, or wellness workshops are shortsighted. They only think about hiring someone like me (I teach mindful communication ) when there’s a problem and they want to stop the bleed. Essentially they’re looking for a tourniquet, which by the way...fun fact... when used for too long causes permanent damage to muscles, nerves, and blood vessels. Yet companies keep applying "tourniquets" all over their company culture until it’s toxic and "permanently damages" the soul of everyone in it.

When you have people fleeing your company because of its toxic culture, it’s going to cost you money to onboard someone new. If their salary is $100k and you hire a recruiter to find the right candidate for you, you’re probably going to be paying a finder’s fee of $20k-$30k. Yet it would probably only cost you $10k - $15k to hire someone to do a leadership and development training on emotional intelligence and interpersonal communication skills. Again, it’s all about your mindset, do you want to be proactive or reactive in the way you take care of your employees.

Changing corporate culture isn’t done overnight and there is not shortcut on this matter. I think it goes without saying that the change needs to happen from the top. The types of behavior that is acceptable at the C-level in your company, inevitably makes its way to down the chain of command. What are you actively doing (every day) to create a positive climate? How do your actions make people feel at the end of their day? While a lot of the corporate world treats their employees as human-doings, you can be different and treat them as human-beings. Like the late Maya Angelou famously said, “People will forget what you said, people will forget what you did, but people will never forget how you made them feel.”

Eager to Learn More? Check out Don Sull and Charlie Sull on Brene Brown’s Dare To Lead podcast.

Enjoyed this Article? You can follow me on LinkedIn or find me on Instagram , YouTube , Twitter, or sign-up for my Newsletter .