Latin Corner: Lessons from Mexico’s Decade of Constant Resignation
By Paulina Navarro, CFO & Co-founder, Thrust
Ed. Note: this piece comes to us from Culturati member Paulina Navarro, co-founder of Thrust Co., a Mexico City-based consultancy that specializes in strategic culture design for organizations like Coca-Cola, Ilumexico, GNC, Casa Lumbre, Xertica, and Cemex.
Over the last year, we’ve all seen and read a series of articles, opinion pieces and studies about the social phenomenon known as The Great Resignation. This has led me to a personal and professional reflection as a millennial and co-founder of a Mexican startup about what’s really behind this high global churn rate and near-constant resignations.
Three Central Features
The Great Resignation has three central features.
The first central feature of the Great Resignation is people raising questions about their life’s purpose. Global crises, hyper-connectivity of opinions (and ideology) plus a general sense of hopelessness have caused new generations to seek employment in companies whose purposes align to theirs, creating a sense of reconciliation with the unrest of living in culturally, economically, and socially uncertain times.
Another central feature is that thanks to technology, great access to information and a sense of immediacy have driven a lot of young people to feel their work is moving too fast. They feel profoundly out of sync with the world they live in, and express deep anxiety about the speed of business.
A final central feature is questions about what can only be described as a spiritual dimension. To a generation that has grown up with a optimism about the future and a pervading sense of fairness and justice, things like increasing wealth inequality and structural racism have activated a departure from the norms we maybe have until now taken for granted, and put an “every person-for-herself” mentality in its place.
A Decade of Resignation
In the Latin-American region, a lot of companies have prioritized development through the creation of new products and innovations, but have neglected a vital part of their business and operations — culture.
As a result, we’ve already been experiencing The Great Resignation for almost 10 years, if you can imagine that. And in those 10 years, we’ve become subject matter experts.
The main reason for this is that many of our companies haven’t evolved their corporate talent strategy at an appropriate pace, resulting in a rather outdated approach to the role of their HR and talent operations. They are living in the past.
Simultaneously, Latin American youth have an innately global perspective. They demand updated and modern work-related practices that respond to ever-changing world needs. They are living in the future.
Put another way, what happened to the U.S. during Covid has been happening in Latin America for quite awhile now — we’ve been questioning priorities and first principles, and we’ve been willing to move places or make major changes in order to re-take control of our lives.
In Mexico, this reality is visible in the incredibly high employee turnover rate of 16.75% average across industries over the last 10 years, according to the Mexican Human Resources Association.
And thanks to Mexico’s proximity to the United States — and the gravitas the U.S. has in terms of job opportunities and the so-called American dream — whole generations of highly competitive and prepared Mexican professionals continue to decide to take their talents north. Those who stay in Mexico have correspondingly high expectations for their job and the companies they are willing to work for.
Not to mention, Mexico also has an incredibly high number of professionals who dedicate their lives to freelancing. This is perhaps our most striking statistic. According to the National Institute of Geography and Statistics, in 2019, around 14 million Mexican professionals worked full-time as freelancers, representing a staggering 25% of the workforce. And that was before Covid even started.
Our Advice for You
I hope that whether you have an office or do business in Latin America, or are simply looking for a new take on the trend, our perspective from where we sit in Mexico City can help. Here are our main takeaways for organizational leaders from a decade struggling with the Great Resignation.
One, create a proactive, well-designed system for employee turnover to ensure openness, agility and simplicity in the closure process. The Great Resignation will not end soon, so we may as well get good at it. Systems that speed up the departure of employees who wish to leave the company instead of putting up barriers should be embraced. Don’t spend resources to keep avoiding the unavoidable. Most companies’ first instinct is to do just the opposite. If anything, lean into helping your people get to where they need to be. Those that stay will observe this behavior and reward you for it.
Two, look at your ratio of resources spent — both time and money — on attracting talent versus retaining talent. We all talk about retention but are you really investing there as much as you need to? I find that while many companies talk about the importance of retention, that importance is not reflected in their budget, their org chart, or their measurables. I understand how easy it is to get into an “attraction loop.” Because of the Great Resignation rate it can feel like replacing folks is everything. Still, I urge you to fight against the trend by leaning hard into retention strategies — both amplifying things you already know work, and thinking creatively about new ideas and options.
Three, begin to normalize conversations about purpose, pace, and spirit at work. Many employees feel like they can’t bring up the real issues they’re struggling with a colleague, mentor, or manager. Instead, they talk about more nebulous yet approachable things like burnout and flexibility, which stand-in for what’s really going on beneath the surface. This can be uncomfortable because older generations in particular are used to compartmentalizing these conversations outside of the workplace. And yet they are inseparable from performance. Your business and your people are living in a VUCA (volatile, uncertain, complex, ambiguous) world. If you embrace this as a plain fact of life in 2022 and beyond, your story and your strategy become much more relatable. You don’t have to have all the answers. You just have to be willing to listen to the challenges folks are facing. That alone can change an employee’s “fight or flight” relationship to the underlying issues driving the Great Resignation. A true embrace of tough conversations about the complexities and multiple layers surrounding the current state of work can make a huge difference.
Lastly, integrate culture into the DNA of your business strategy. We must understand ways to integrate organizational development and culture as a vital part of how we make money and how we judge success. Lots of us say we have integrated culture into our business strategy, but have we really? Simply ask yourself: is what the culture wants and needs often at odds with what the business wants and needs? Or: how often do you feel torn between the competing interests of culture and business? In the ideal, the culture and the business want and need the same things — they are deeply aligned. I’ll even go one step further to say: many of us are good at making the business case for culture, but how good are we at making the culture case for business? Until that street goes both ways, you’re sending mixed messages, and those mixed messages do more damage than you may realize.
A Note of Optimism to Finish
We’re not lost. A lot of major steps have already been taken. A lot of people have already revolutionized the companies they work in, for the better.
But this is a decades-long process. As many people have said over and over again, the Great Resignation isn’t a trendline, it is a permanent condition. We don’t have all the answers in Latin America, certainly. But because we have been living with Great Resignation-like dynamics for a long time now, we’ve acclimated to the challenges in a deep way — and as a result I think we’re less in denial about what is really going on.
We still have tons of work to do ourselves, because we are always at risk for accepting the status quo — complacency is the shadow side of empathy and embrace.
But I’m incredibly optimistic overall and here’s why: the pace of learning is increasing. The last few years have functioned as a time machine of sorts. We skipped ahead a few years, in many senses.
Even more importantly, I’m seeing a new wave of leaders who aren’t just coping with the pandemic and its first and second-order effects, but are using this unique moment in time to open themselves and their companies up creatively. They are setting exciting new precedents that show us the future.