Since the beginning of the pandemic, a record number of workers have left their jobs, causing experts to coin the term “The Great Resignation.” A recent study from Price Waterhouse Cooper shows that The Great Resignation is far from over, with one in five workers expected to quit their job in 2022.
But why? The pandemic served as a wake-up call for many American workers who had more time to reevaluate, reprioritize, and reflect on what they do. Remote work created a shift in the mindset for many, and people are no longer content to work merely to get by. The pandemic has shown them that work must now accommodate a balanced life.
This presents challenges for employers. What can you do to hang on to your employees and how can you attract new talent? Small business hiring has slowed in recent months, not for lack of demand, but because hiring became even harder in Q32022 than it was even a year ago. These shortages are disproportionately impacting smaller businesses, says the US Census Bureau. By the end of March 2022, 40% of small businesses cited labor needs, up from 23.4% in August 2020. Employee shortages have forced many small businesses to reduce their hours of operation.
Most employees are back in the workforce which means that employers must attract employees from other employers rather than from a pool of unemployed workers. This is a challenging task – and employers must evaluate their offering to present prospective hires with competitive compensation and a place where people want to work. Similar challenges are in play for employers to retain the employees they have.
So, what can your small business do to attract and retain employees? We have a list of ten factors that could make a difference.
Seek employee feedback
It may sound like a no-brainer, but one of the best ways to retain your employees in the future is to determine why workers are leaving your organization in the first place. Conduct exit interviews to understand the factors driving employees to leave, and use the data uncovered through these interviews to develop your company’s employee retention strategy.
But you need not wait until employees leave to seek their feedback. Take the pulse of your company with regular opinion surveys to make changes before your employees leave. Your employees have choices, and it’s essential to listen to your workers, lest they leave to go work somewhere else.
Career/Advancement: Do employees have room to grow?
Many workers are leaving their jobs for career reasons. There’s not a clear path for advancement, they’re not feeling fulfilled – in short, they feel stuck. A 2022 Employee Benefits survey from SHRM found that 65% of employers thought that professional career development benefits were important now compared to 37% in 2020/2021. What can you do to keep these employees from leaving? Improve advancement opportunities. Create development plans to ensure all employees have opportunities for advancement.
Paychecks and perks
While pay isn’t the number one factor that drives an employee to leave their job, it is still high on the list. Companies need to evaluate the compensation packages and perks they offer to retain their employees, as well as to appeal to potential new hires. Compensation must be competitive, and you should evaluate and adjust salaries regularly. If pay increases aren’t feasible right now, consider whether you could provide compensation in other forms. Some companies are even evaluating how frequently they pay employees and are increasing to weekly, or even daily, pay.
And the same old benefits package won’t do anymore. Jeanne J. Sutton, a financial benefits advisor at Bowling Green, Ky.-based consultancy Strategic Retirement Partners, suggests a variety of benefits that employers could consider adding to their benefits package, such as assistance with student debt, implementing a four-day workweek, free daycare, or offering support to parents with small children. According to Sutton, companies should let employees choose which benefits are most valuable to them.
Live to work or work to live?
Lack of work/life balance is driving many employees to resign. Approximately 12% of employees cite work/life balance as their reason for leaving. This has especially become an issue since the Covid-19 pandemic and has continually trended up 20% since 2013. Consider the message that your company’s time management is sending to employees. Are workers expected to be available around the clock? The better the balance, the higher the job satisfaction.
Likewise, flexibility in work environment may offer greater balance. When so many offices sent employees home to work remotely during the pandemic, people unexpectedly realized the benefit of work from home life and how it improved their day-to-day lives. Now that many companies have reopened their offices, a segment of employees would still like to work remotely, or at minimum, utilize a hybrid schedule. A Robert Half survey found that half of professionals currently working from home would seek new employment if they were required to return to a full-time office schedule. If remote work is feasible for your industry, it should be considered as it’s an option many employees want.
Revisit your hiring process
A way to ensure that you retain employees is to be sure you’re hiring the right ones in the first place. Look at your hiring process to be sure that you’re equipped with the resources needed to acquire new talent.
You’re competing for a finite group of candidates, and if feasible, get creative and widen the pool. There are many underemployed workers filled with potential who may be an excellent fit for your organization. Regularly review and analyze your applicant data to be sure that your company is attracting and considering the widest and most diverse applicant pool.
Ohio employers still struggling to fill vacant positions, found social media advertising has been a successful method for many companies. Potential employees who may not have resumes at the ready can respond to social media job postings easily. Consider creating a referral program and pay current employees for their candidate referrals.
If your interview process is long and drawn out, it may be costing your company strong candidates. Find a way to streamline the interview, offer, negotiation, and onboarding process in order to have your pick of qualified candidates. Hosting hire parties or events can be a successful way to generate candidate interest for open positions, while expediting the early stages of the hiring process timeline.
Set employees up for success
The process of onboarding allows your new hires to start on the right foot. A good onboarding program teaches new employees about the job and the culture of your company. Communicating your company’s values and culture allows your new hires to understand the way the company works and how they can be successful there. And training shouldn’t end with onboarding. Providing continuous performance feedback allows employees to identify areas in which they can grow. When your employees expand their skill sets, they gain new abilities that improve and change the way they work.
Open the lines of communication
Good communication has always been essential but the need for clarity was made even more obvious during the shift to hybrid or remote work. Make sure the lines of communication are open. Ensure you have cultivated an environment where your direct reports, whether they work remotely or on-site, feel they can come to you with questions or concerns at any time.
Teamwork can reinforce company culture and drive the success of employee efforts. Create opportunities to collaborate and encourage teamwork while promoting the notion that every member’s contribution is important. All employees should feel empowered to present their ideas and solutions.
Acknowledge and appreciate
Employees have cited a lack of recognition of outstanding performance and contributions as a reason they have or would leave their job. Every person wants to feel appreciated for the work they do, and this feedback crystallizes the need for companies to acknowledge milestones and provide ongoing feedback on job performance.
For workers to succeed, they first need to know what their objectives are. Be sure each member of your team is aware of objectives – from the company’s goals, the department’s goals, and each employee’s goals. Once those objectives have been communicated, provide regular feedback. Many employers have shifted from an annual review format to more frequent meetings with team members.
Acknowledging milestones big and small can play a role in retaining employees. It is meaningful to acknowledge and celebrate notable achievements on your team – from a worker’s tenth anniversary to finishing a project ahead of deadline.
Look at leadership
A company’s leadership impacts the attitudes and morale of your team. It’s worthwhile to take a critical look at management to consider if leadership is a factor in workers leaving your organization. Your goal should be to create a work environment where employees want to be.
Many of the factors we’ve already mentioned – clear communication, employee recognition, and so forth, will contribute to a stronger and more positive perception of management in your organization. It’s beneficial to pay attention to your employees and be mindful of their experiences.
A final thought
The problem of attracting and retaining talent for small businesses will continue to permeate the economy in the near future. However, taking steps to implement policies and procedures in the workplace that illustrate flexibility, honesty, and transparency, and appreciation, will go a long way in the race for sustainability of the workforce.