As the “war on talent” continues to the point we are all sick of hearing that phrase, it’s important to also focus on the development and retention of your current employees. Be careful not to place so much attention on attracting outside talent, that you forget about your existing talent.
According to a recent LinkedIn report only 32% of employers view retention as a top priority in the next year. But as the economy continues to strengthen and employee tenure continues to shorten, retention stands to be a key element for successful staffing in 2017.
While the ability to attract and recruit talent is vital to any company’s success – many companies fail to develop a holistic approach to the entire candidate lifecycle. This includes attraction, onboarding and ongoing employee development. This disconnect creates a process where companies over-emphasize hiring and under-emphasize development, leading to retention issues and creating an endless loop of new recruiting.
Knowing how hard it is to recruit high quality talent, companies need to have a plan in place to retain that talent once brought on board. Assuming the economy continues to grow under the new administration, hiring should continue to grow in the New Year as well. This growth will put even more pressure on organizations to retain the talent they’ve worked so hard to secure over the past years.
Employee tenure continues to decrease. According to the U.S. Bureau of Labor Statistics, 18-35 year-olds had an average tenure of 1.6 years per job in January 2016. By 2020 millennials and gen-Z will make up 50% of the workforce. That means that soon, a majority of your workforce will expect to work with you for less than two years. So what can organizations do to lengthen that employee lifecycle?
Viewing your employees as fundamental building blocks of your organization, not commodities, will allow you to shift your mindset (and resources) towards continual development and growth, helping to keep your talent longer. Employees no longer stay with one employer for their entire career, but with the right strategies you can lengthen their stay with you:
Create the Right Culture
Your company culture should match the type of employees you want to employ, whether you opt for a by-the-book, strict workplace or a more casual, laid-back atmosphere. Just be sure to clearly communicate what the culture is from the beginning. This will help the employee make the best decision for him or herself as to the quality of the fit. The better the fit, the longer he or she will stay.
Offer Training and Development
When you take your employees' education seriously, they see it as an investment in their career. Whether you send employees to a learning center or you provide membership to one of the many e-learning sites available, they will appreciate the ability to continually improve their skills.
If an employee feels confused about his role in your organization, he's more likely to feel disgruntled and begin searching for something else. This guidance should go beyond the onboarding months. Employees should be fully aware of their job duties and how they are performing. Have a job plan in place and provide regular feedback on an employee's performance. Don’t just perform annual reviews. Employees and managers should be consistently communicating about how job duties are evolving and being performed.
As difficult as it is to pay competitive salaries when budgets are tight, calculate the cost to replace employees. It can cost as much as 30-50% of an entry-level employee's annual salary just to replace him. On the other hand, employees often achieve a 10-20% salary increase by simply moving from one company to the next, which makes jumping ship attractive. Be aware of benchmarking salaries in your industry and region and stay at or above those benchmarks.
Don’t Punish Competence
Too often, managers spend most of their time on employees who are struggling, leaving the talented ones feeling neglected. Over time, this can lead to resentment as star employees start to feel unnoticed and unsupported. Managers must make an effort to let top performers know their hard work isn't going unnoticed. Work with the stars as well and give them opportunities to grow.
Be More Flexible
Today’s workers overwhelmingly prefer flexible working conditions. Most employees are now accessible 24/7. If you expect employees to answer their phone when a client calls after hours on a Friday night, you should also understand when that employee comes in late one morning or needs to take off early. Employees are seeking a life/work balance and appreciate the trust and flexibility it takes to accomplish that.
While small businesses often struggle to compete with larger corporations in providing benefits, you don't have to beat big business in the healthcare options you offer. But you can offer things they might not get elsewhere, such as the ability to work from home, more flexible vacation offerings, and performance bonuses.
Keep an Eye on Management
As much as you try make your company attractive to talented people, the truth is employees most often leave a company because of their manager. According to a Gallup study around 50% of employees leave their company to get away from their bosses. Employees who don’t get along with their managers, don’t like them or don’t respect them, will leave a company despite a high salary or great benefits. Encourage confidential employee feedback and perform exit interviews when employees leave. A good manager will inspire loyalty and will retain the majority of their staff. Be sure to offer managers development options as well.
Companies hoping to hold on to their top people in 2017’s shallow labor pool are going to have remain nimble and innovative in order to retain their best workers in the year ahead. With a strong economy and low unemployment rates, retention will be the key to maintaining efficient staffing levels.
Source: forbes.com, huffingtonpost.com