‘Quiet Quitting’: What Bank Executives Should Know and Do

Sure, it's a catchy phrase that's gone viral, but the behavior behind 'quiet quitting' is real and can cost financial institutions more than lost productivity. Without an engaged workforce, banks and credit unions will be hard pressed to succeed in digital innovation. Experts suggest how to counter the trend.
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The term “quiet quitting” is on a lot of minds, but the definition depends on whom you ask. To some — including the TikTok video that sent the term viral — quiet quitting refers to meeting performance expectations and no more. “What quiet quitting means is someone who has decided, ‘I want to prioritize my wellbeing overall and things outside of work’,” as Korn Ferry senior client partner, Elise Freedman, told CBS MoneyWatch.

Others, however, believe quiet quitting is a signal of a poor work ethic and an inferior employee attitude. Jamie Dimon, CEO of JPMorgan, said during an earnings call that China is right to label Americans “incompetent and lazy.” From that perspective, quiet quitting is a form of goldbricking next door to theft.

Regardless of the definition, Gallup finds that half the working population and maybe more are quietly quitting — and it’s not a new trend. Indeed, the problem is so endemic that workplace researchers have a word for it: disengagement, a disconnect between employee and employer that causes people to emotionally withdraw from their job.

Attention Grabber:

Portion of the U.S. workforce Gallup estimates would qualify as 'quiet quitters':
50%

Of course, every organization has its share of strivers, slackers, and worker bees. If that were the extent of it, “quiet quitting” wouldn’t be a headline issue … but employees who are engaged contribute 57% more on-the-job effort and are 87% less likely to quit, says PwC.

It’s hard to argue that people should do work they’re not paid for and emotional engagement isn’t in anyone’s job description. But quiet quitters’ disengagement is a real risk to the strategies — fintech, new products, customer experience and all the rest — that determine a bank’s future. And Forbes calculates the cost of disengagement as equal to a third of a disengaged worker’s salary.

Moving slackers into the worker bee category — and inspiring worker bees’ ambition — not only recoups those costs, it can also speed your bank’s growth and improve its P&L. In your bank, that might begin with pay and advancement structures. Perceptions of low pay and limited opportunities (along with poor communication during times of change) are why a third of bank employees are looking to leave, according a Quantum Workplace report.

Read More: How ‘The Great Resignation’ Changed the Banking Workforce Forever

Pay Inspires Diligence When Connected to Performance

Though wages in the U.S. are rising, a third of employees in finance are dissatisfied with their pay, a survey by eFinancialCareers found. They may be underpaid, but more likely they feel underappreciated. In banking, pay is a marker of status, a signal of job security, and a form of validation — money is never just money. If pay doesn’t match the workers’ actual or perceived value, what may seem like a perfectly adequate sum to the person signing the paycheck may feel like an insult to the person cashing it.

Bank of America appears to recognize that —it has been increasing pay considerably lately. In January 2022, the bank issued restricted stock units valued between $2,900 and $27,000 to 97% of its workforce, and followed that with 3% to 7% raises in May for employees earning less than $100,000.

Note that BofA’s employee satisfaction rates are 27 points over the industry average, according to the consulting company Great Place to Work.

Granted, it’s hard to stomach losing a third of your labor costs to unproductive job performance — but boosting salaries can assure employees of their worth, status, and security, which can increase engagement and motivate better performance. That’s in the bank’s long-term financial interest.

Hidden Consequence:

Cost of disengaged worker: 34% of salary in lost productivity.

But there is a cloud to that silver lining. To be engaging, pay has to be clearly tied to objective performance metrics that unquestionably achieve the bank’s outcomes. If not, money can stir up distrust, dissent, employee competition and unethical behavior. That’s especially common when performance is judged by work the employee can’t control, or when bank employees are pitted against each other. The Wells Fargo sales scandal demonstrated this in spades.

To solve for that, management experts recommend that leaders:

  • Define productivity to all your direct reports.
  • Communicate your performance assessment criteria.
  • Detail your metrics of success — and have managers do it too.
  • Connect work to the bank’s outcomes in each role.
  • Get employee feedback — their idea of fair pay sheds light on day-to-day job demands and obstacles.
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Map the Career Paths in Your Financial Institution

Like pay, advancement can feel like a mark of the employee’s value and management’s esteem, so promotions can have a psychological effect similar to that of a raise. But if advancement seems arbitrary or the career path is unclear, discretionary effort has no reward.

“People may quiet quit if they feel the organization quit on them. It’s like, ‘Why should I go the extra mile if it gets me nowhere?’”

— Jody Van Osdel, Gallup

That attitude can drive people to the bare minimum — or out the door. Indeed, Pew Research finds that 63% of people note lack of advancement opportunities as a reason for quitting.

This may sound baffling during a labor shortage, when banks are constantly posting on hiring websites and are still coming up empty. But employees don’t always know the opportunities available in their own bank, or the skill sets they need to move up. In fact, external job seekers may know more about roles in your bank than your employees do.

Read More:

Are Managers Up to the Challenge?

Worse than an unclear career path, employees may be expecting their managers to help them advance. That can be a bad move. Banks that prioritize stability over growth inadvertently incentivize managers to stall advancement. Moreover, most managers aren’t trained to spot potential, develop it, and aim it at bigger business needs, leaving them to rely on gut feelings —notoriously biased — in promotion decisions.

Such managers are not rare. “Many people, at some point in their career, have worked for a manager that moved them toward quiet quitting,” wrote Jack Zenger and Joseph Folkman in an HBR analysis. “This comes from feeling undervalued and unappreciated.” Their research finds that poor managers have three to four times as many quiet quitters as effective managers do.

Dead End:

The reason one-third of employees leave their jobs: lack of advancement opportunities.

Training managers is an obvious solution and a good one, but it takes time. A faster way to stimulate quiet quitters’ dedication is to publicize career paths and advancement opportunities within the bank — like an internal Glassdoor.

It only works, however, if job requirements, skill sets, and the KPIs that measure productivity are accurate, but it can illuminate career paths that employees don’t see —and the benefit of discretionary effort.

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