It's no secret that we're living in one of the hottest job markets in recent memory. Talented professionals choose where they want to work and command higher salaries. Recruiting the top talent of tomorrow is harder than ever. However, hiring is only half the battle. With so much choice for jobseekers, it's much easier for your current employees to depart for other opportunities. In fact, 70% of employees are at least passive jobseekers.
That mindset of "always on the market" means your business needs to work harder than ever to maintain your core base of talent. Start by evaluating an employee's day-to-day worklife, then identify and address any reasons they may leave, and use this information to create a unique strategy for retention. With any luck, they'll retire happily from your company.
Today's market is competitive. Here's the quick and dirty:
Top companies are offering perks to their talent like onsite musical instruments, massage therapists and nap pods. Thankfully, they aren't relevant.
Often, the glue that keeps your employees happy are small aspects of your company's experience and culture you may not consider. Bad technology rates highly for dissatisfaction, and poor processes and hard to use tools create small bits of daily dissatisfaction that make or break your employee's decision to leave a job. Invest in tools that are so good, it's like they aren't there, such as great human capital management (HCM). Nothing will cause dissatisfaction more quickly than a payroll issue or difficulties with tax forms, which can be prevented through a cloud-based payroll solution.
According to Dan Cho, Director of Technology Services at Vaco Seattle, a key area to improve employee retention is to "find out what your employee's goals are and do everything in your power to help them get there." That, and "being a decent human being" won Vaco the title of "Best Staffing Firm to Work For" in 2019.
Strong culture joined with competitive benefits will help keep your employees engaged so that they will stay with your company for the long haul.
Problem: Employees leave for better pay
According to the latest JOLT report, there are currently more jobs than there are people to fill them. Compensation matters when an employee considers a job change. Some states have made the salary history question, history. Instead, they ask what employees want to make. The result is that with every job change, employees are making more and more. The competitive salary of two years ago may not be as attractive now.
How to fix it: Monitor your local labor market to see what other companies offer. Revisit your employee's salary during their yearly performance review to learn their satisfaction level, then adjust accordingly. Implement referral programs and host contests that let employees earn a day of PTO, a gift card or free food. Consider bonus structure or equity as part of your company package. Benefits also count towards compensation. Implementing a 401(k) match can improve employee morale. Pay does not end at salary, and these other benefits make a difference an employee will think about if another company approaches them.
Problem: Lack of recognition and rewards
Employees don't choose to leave a company overnight. Once an employee has completed training and is engaging in their day-to-day activities, they will want to feel recognized and that their work makes a difference. While pay is important, engagement will make employees happy and satisfied with their work. If every day feels like a slog, it becomes easier to consider new opportunities. The biggest culprits that create feelings of not being recognized or rewarded are little day-to-day problems and irritations that build over time.
How to fix it: Create moments for your employees where their day-to-day script is interrupted in a positive way. Small, thoughtful gestures go a long way. Ensure that the employee's work is seen and that their impact to the company is made clear. Eliminate any barriers to their work, including clunky technology and complex procedures. Your organization should feel like a team, so celebrate wins and learn from losses together. Give employees access to key figures in your business - a kind email from a C-level employee will delight the workers who don't hear from leadership each day.
Problem: Bad managers make people quit
It's common to promote a successful employee into management. While it makes sense, sometimes these people would rather contribute directly to your company's cause than manage people, and simply take these roles for the pay increase and title change. It's likely your lost employee's direct manager could have fixed the problem before they left. Spending time reporting to someone you dislike is untenable, no matter the pay or recognition.
How to fix it: Be sure that you develop frontline managers who enjoy managing people, not just because they were good at the job they did before. Conduct 360 reviews throughout your company to identify bad managers and take swift action: they are costing you significantly. Invest in a training program for new managers and establish clear company values and goals for them to follow.
No matter what, your business will have some attrition. This is natural. During the onboarding and offboarding process, your company has a unique ability to make a fantastic first and last impression. Empower your HR with tools and experts, like the ones at Inflection HR, so that entrances are easy and exits are graceful. Good HR is key to your employee retention strategy.