Smart strategies for reenergizing your workforce and attracting top talent in a challenging labor market.
An average of nearly 4 million workers quit their jobs each month in 2021, according to the U.S. Bureau of Labor Statistics. After an already tumultuous period, companies are now facing a new hurdle: an increasingly competitive labor market that has made it difficult for them not only to retain their existing workers, but to fill vacancies when a departure occurs.
The driving forces behind what has become known as the “Great Resignation” have been attributed to everything from a widespread desire to work remotely to the short-term expansion of unemployment benefits under the Coronavirus Aid, Relief and Economic Security (CARES) Act. The reality, however, is far more complex.
From immunocompromised workers faced with health concerns to parents leaving their jobs in order to homeschool their children, a significant number of Americans found themselves forced to exit the workforce at the height of the pandemic. Perhaps unsurprisingly, data from the U.S. Bureau of Labor Statistics shows that frontline industries such as food service, accommodation, and retail were hardest hit by resignations between February 2020 and November 2021.
Meanwhile, data from the Federal Reserve Bank of St. Louis shows that over 3 million baby boomers took early retirement during the pandemic. This mass exodus has had a significant impact on all sectors, leaving many organizations scrambling to fill senior-level roles. Then, of course, there’s the mental and emotional impact of the pandemic, which has led workers of all ages, backgrounds, and industries to reevaluate many facets of their lives — including their relationship with work.
These converging factors have resulted in a unique labor market in which workers now can demand higher wages, better benefits, and working arrangements that fit their lifestyle. And it’s not just white-collar workers who are reaping these benefits. According to National Economic Council Deputy Director Bharat Ramamurti, workers in historically lower-paying sectors have benefited greatly from what he refers to as the “Great Upgrade” — this idea that workers aren’t quitting the labor market, they’re just leaving low-paying jobs for brighter prospects.
“The landscape for talent acquisition, talent management, and employer retention has changed, and may forever be altered,” says Ryan King, Head of Talent Acquisition for Regions Bank in Episode 15 of Commercial Insights with Regions Bank. “The nature of work is evolving, and the psychology of job seekers has changed. Job openings are plentiful and, as a result, workers have more confidence than ever to switch roles in search of better wages, career growth, and more flexible work.”
For many employers, it has become difficult to both attract and retain workers. And for those experiencing high turnover, the loss of institutional knowledge and the impact on the morale of remaining employees can significantly impact a company’s bottom line in ways that are often difficult to quantify.
Conversely, some companies have used the Great Resignation to their advantage: Those that saw this shift as an opportunity and acted quickly have been able to hire some of their industry’s top talent away from competitors.
“Every company should be reevaluating their talent acquisition and talent management strategies at this time,” King advises. “The companies that explore long-term solutions are going to be the ones that succeed as we move forward.”
Retaining Your Most Valuable Employees
Gaining a deeper understanding of what your employees want, need, and would like to see changed can be a valuable exercise, particularly for those dealing with higher than average turnover. According to Gallup, 52% of voluntarily exiting employees say their employer could’ve done something to prevent them from leaving their job.
The factors driving turnover at your organization may not always be what you expect. According to a 2021 analysis conducted by MIT Sloan, corporate culture was the top reason for departures during that year, accounting for 10.4 times more departures than compensation. Lack of employee recognition was another key driver, accounting for nearly three times more departures than salary.
Needless to say, simply attributing each departure to the “Great Resignation” might be doing a disservice to both your employees and to the health of your organization. Understanding the factors driving departures will be key to reenergizing your workforce and improving employee retention.
Keeping your ear to the ground
Exit interviews can be one of the most effective ways to better understand the factors driving turnover, particularly in cases where a key player is leaving your organization. Whether they take the form of informal conversations led by HR or written surveys, exit interviews should be used as an opportunity to get honest answers about why your employee is choosing to leave your company and what — if anything — you could have done differently to prevent that loss.
Employee engagement surveys are another tactic which, when implemented correctly, can be a powerful tool to boost employee engagement and retention. Beyond simply helping you identify what you should be doing differently, surveys can also be used to help you determine what your organization is doing right. The insights can then be used to develop your employee value proposition, or EVP.
As you create your employee engagement survey, you’ll want to keep in mind that a successful survey will be thorough, measurable, and actionable. Make sure you’re not only asking the right questions, but also doing so in the right format. For example, rather than presenting your employees with open-ended questions, consider asking them to rate your company’s performance in key areas on a scale of 1-5. While you can still provide your employees with space to leave written feedback if desired, a sliding scale format will help ensure that the feedback you receive is quantifiable and measurable, allowing you to chart your progress over time and measure the success of any new employee engagement initiatives you may be launching.
While employee engagement surveys can be as comprehensive or as simple as you deem necessary, some key areas to focus on might include compensation, benefits, work environment, workload, team dynamics, management, and overall sentiment toward the company.
Turning insights into action
Of course, surveys alone aren’t enough. Your employees will want to know that their feedback is not just being heard, but also that changes are being implemented. Take time to carefully review survey responses, identifying both organizational strengths and areas for improvement.
While it’s going to be difficult to address every bit of feedback you receive, you might begin by selecting two or three key areas to focus on. For instance, if you’re fielding a lot of questions about flexible work schedules or remote work opportunities, you might want to start there. If your business isn’t able to offer employees remote work opportunities, King recommends taking the time to think outside of the box.
“Those offerings are not available to every company and in every industry, so it's really important that you strategize and offer what you can to remain competitive,” he says.
As you introduce new talent acquisition and engagement initiatives, continue to survey your employees on a periodic basis, but not more than once per quarter. By taking the pulse of your organization on a periodic basis, you can track the return on investment of new initiatives and measure the success of your efforts over time.
Showcasing Your Value to Candidates
Establishing or refreshing your employer brand has never been more important, according to King. Just as a company’s brand serves as the North Star for all its marketing and customer acquisition efforts, the employer brand should do the same for talent acquisition. In his experience, one of the most effective places to start is by identifying your employee value proposition.
“The employee value proposition is not new in terms of talent acquisition and management, but it is something that is evolving,” he explains. “Most companies historically have just allowed their EVP to happen naturally, but as society has changed and as trends have changed and external factors have started to impact employers' abilities to attract talent, we've all had to be more mindful of what that EVP looks like.”
What makes a good EVP?
A good employee value proposition should answer the question, “Why should I work for your company?” in a clear and compelling way. Your EVP should take into account all of the factors that encompass an employee’s experience within your organization, including compensation, benefits, opportunities for career development and growth, work environment, and company culture. If you’ve already conducted an employee engagement survey, use those insights to identify what makes your organization shine.
Also, think carefully about your company culture and how you would describe it. “Company culture is often referred to as ‘the way things are done around here,’ but you really have to be more specific than that,” says King. “The best companies recognize that great culture focuses on three things: behaviors, systems, and practices. For instance, two years ago, things like ESG [environmental, social, and governance] might not have impacted a company's ability to recruit positively or negatively, but now it's a big deal for many.”
King recommends pulling together a team of high-performing individuals from across your company to help develop and promote your EVP. Ask them what current employees love about working for your company and highlight those benefits. And when it comes time to promote your EVP externally to help drive recruiting, leverage the expertise of your marketing and communications teams.
Finally, King emphasizes the importance of keeping employees at the center of every decision you make. Remaining engaged with your employees — particularly during periods of rapid transformation — is a surefire way to ensure that they, in turn, remain engaged with your company.
“Companies cannot revert back to their old pre-pandemic ways and forget that the pandemic ever happened,” he notes. “Take care of your employees, because they are your greatest asset.”
For more, be sure to check out the Summer 2022 issue of Commercial Insights Magazine.
