The Great Resignation is plaguing employers of all sizes and throughout most industries. Are you poised to retain and hire quality talent?
Employees are jumping ship in record numbers, but many are accepting new jobs only to realize that they’ve made a huge mistake. It happens to the best of us. It’s human nature to be lured by big promises: double-digit salary increases, unlimited vacation, exciting new challenges, a staff to support you, unlimited job growth. But does the reality match the rosy picture presented?
Often the answer is no. Then why are workers leapfrogging to new jobs?
Big companies are wielding their financial might in an attempt to keep and attract the best and the brightest. In 2021, some major consulting firms gave employees retention bonuses and followed up with mid-year base salary adjustments. A law firm I know of raised its first-year associate starting salary to $205,000. Lower-wage workers too, are being attracted with signing bonuses, tuition assistance and medical benefits they’ve never seen before.
There’s a tremendous amount of ambiguity in the labor market. In the past three months, about 625,000 people who said they had retired went back to work, according to federal data. Then there’s the boomerang employee trend, with experts predicting that The Great Resignation will morph into “The Great Return” of talent as COVID concerns subside.
The sheer amount of uncertainty is creating chaos, clouding people’s judgement, and making the decisions of both employers and employees more erratic. Here are some ideas for action if you’re struggling with employee retention.
Don’t guess what employees want
Many business owners and leaders automatically assume that salary increases, bonuses and retention ‘thank you’ money will fix their attrition problem. While money is certainly a driver, the real question is what are employees running from? A recent survey by McKinsey & Company is revealing. The top three reasons people quit their jobs had nothing to do with money. Survey respondents said they didn’t feel valued (54%), their manager was the reason (52%) and they didn’t feel a sense of belonging (51%). Throwing cash at staff members feels transactional noted McKinsey researchers. What workers really want is to feel a human connection and sense of purpose.
While you can’t bury your head in the sand and wish the Great Resignation away, losing employees doesn’t have to be inevitable. In fact, of all the reasons employees quit, 78% could have been prevented by the employer (Source: Work Institute). It’s essential to learn what your employees honestly think and feel and find out what’s working and what’s not.
Re-engineer performance management
Employers spend a lot of time with onboarding and exit interviews. What often gets short shrift are performance conversations. Traditionally, performance management is fairly one-sided. Managers set annual goals. Feedback and recognition is infrequent and irregular, and there are limited opportunities for discussion. Re-engineered performance management starts with agile, collaborative goals. Conversations between supervisors and employees are ongoing. Progress reviews are quarterly with accountability and incentive adjustments.
A major benefit to this approach is improved communication between supervisors and employees. These one-on-ones are a great opportunity to learn how individual employees are feeling. Ask team members what challenges they are facing, what skills they want to develop, where they want to go within the business, and most important, why they might leave your company, say in six months or a year.
Why ask why? It shows employees that you really care about them as humans. It gives them a platform for sharing their concerns about the enterprise, about management and about their careers. It also can reveal important gaps in your organization that you can fix before team members join the masses in The Great Resignation and head for the exit sign.
Paint the picture
If you are confronted with an employee resignation, have an open mind to retaining them. Remember that on average it costs six to nine months of an employee’s salary to replace him or her.
At the same time, other companies can always outbid you. That’s why it’s important to broaden the conversation beyond money and benefits and help them see the upside of staying. Do they love their work? Feel connected with their coworkers? Are they proud to work for your company and value your product/service? Do they have the flexibility and work life balance they want and need? That may not be the case with the new job.
It could be that your worker is bored. Perhaps they don’t see opportunity for growth within your business. Could you create different levels and pay scales within their job and offer them a promotion? Open your horizons and see how you can adapt the situation for the employee instead of letting them walk out the door.
Help your valued team member make an informed decision. Keep it cordial and never burn a bridge by showing that you are hurt or disappointed. You always want to keep the door open for their possible return in six months or a year or two.
If you are struggling with fallout from The Great Resignation including employee retention, hiring, performance management or other people issues, NEMR Total HR might be just the strategic partner who can help you out. Chat Live with us to learn more or Email Us.