8 minute read
Employee Retention Insights
By Karen H. DiGioia, Herbein | Mosteller HR Consulting
Shortages. In 2020, it was toilet paper, PPE and COVID tests. 2021 brought us computer chip and used car shortages (and heaven help you if you tried to find an Uber that year). In ’22, baby formula and sriracha were in short supply. While supply shortages have shifted from year to year, one common shortage, post-pandemic, has been the shortage of talent.
According to a February 2023 article published by the U. S. Chamber of Commerce, there are over 10 million job openings today and 5.7 million unemployed workers. Even if each person who is unemployed had the right set of skills to fill one of those 10 million jobs, we’d still have more than 4 million jobs open. Decreased labor participation rates in combination with high levels of new job creation have largely contributed to this “shortage,” and there’s no sign that this will change any time soon. On top of this, since 2022, we’ve been experiencing the “Great Reshuffle.” More than 4 million workers leave their jobs each month, most taking a job with another employer. The bottom line – employees are in short supply, so employers are focusing heavily on retaining the talent that they have.
The quote at the beginning of this article came from the CEO of one of my clients. The organization that he leads recently completed an IT system conversion, and through the project, he uncovered some “great” employees and is focused on finding ways to ensure that they don’t “go be great for someone else.” In light of the ongoing shortage of talent, this is a challenge that all organizations share. Let’s talk a bit about why people work and what organizations can do to increase their likelihood of retaining the talent that they have.
Why do people work? To start with the obvious – most of us work so that we get paid and can pay for food, shelter, clothing, our favorite frothy coffee drink from the local coffee shop, and whatever else is necessary and important to us. Many of also work so that we have medical and other benefits coverage and can fund our retirement plan.
But is that all there is to it? Do we only work for the money? I asked ChatGPT (an AI language model developed by OpenAI, in case you haven’t heard) why people work, and here’s the answer that I got.
There are many reasons why people work, and these reasons can vary depending on the individual and their circumstances. Here are some common reasons:
1. To earn a living: One of the primary reasons people work is to earn money to support themselves and their families.
2. To pursue a career: Some people work to develop their skills and advance in their chosen career field.
3. To feel a sense of purpose: Many people find meaning and fulfillment in their work, which can give them a sense of purpose and contribute to their overall well-being.
4. To gain social connections: Work can provide opportunities for people to build relationships with coworkers and other professionals, which can be important for personal and professional growth.
5. To contribute to society: Some people work in jobs that allow them to contribute to their communities or society as a whole, such as healthcare workers, teachers, or nonprofit employees.
6. To stay busy: Work can provide structure and routine to people’s lives, and some people may choose to work simply to stay busy and avoid boredom.
These are just a few examples of why people work, and the reasons can be complex and multifaceted. Ultimately, the decision to work is a personal one that depends on an individual’s goals, values, and circumstances.
Let’s spend some time unraveling each part of this answer. While money is part of the answer, it’s far from the only answer. I’ll take a bit of creative license when working through ChatGPT’s answer (because we all know that ChatGPT knows a lot, but she doesn’t know everything – at least not yet).
Competitive Compensation and Benefits (to Earn a Living)
It’s important to begin with a foundation of competitive pay and benefits. Anecdotal pay information becomes more and more accessible to employees every day. It’s posted outside businesses on billboards and signs, listed on Indeed, and available (accurate or not) on a variety of online platforms. As pay transparency laws become more common, the availability of this data will only increase. While pay is far from the only reason people work, knowing what other similar organizations pay and offering competitive pay and benefits is at the foundation of an organization’s ability to attract and retain employees.
I’m going to put flexibility and work-life balance into the “competitive compensation and benefits” category. While all employees appreciate flexibility in their work schedule and the ability to maintain a good work-life balance, for some employees, that flexibility is a necessity. Earlier in this article, I addressed the decrease in labor participation rates, but didn’t talk about the “why” behind this decrease. A meaningful percentage of those who “opted out” of the workforce did so because other responsibilities – often related to the care of children or other family members – have made work difficult or impossible. By providing flexibility when feasible, including options for remote or hybrid work, flexible hours, or part-time work, and being open to accommodating the needs of your employees, an employer improves its ability to retain (and attract) employees.
Opportunity and Growth (to Pursue a Career and Build Relationships to Grow Through Social Connection)
Employees come for the job but stay for the career. They want to know that there is a path for growth and development. But what does “growth and development” look like? To borrow ChatGPT’s words, the answer to this “can vary depending on the individual and their circumstances.”
For some, “development” may focus on the current job – expanding knowledge and becoming more effective and efficient in that role. For others, it may mean a broadening of responsibilities – taking on new challenges and higher-level work. Or it may be a move into a completely different role. The key to determining what’s right for each employee at any point in time is communication – chat (not GPT) with employees about their strengths, interests, and aspirations, and look for ways that they align with the agency’s needs. Have a development plan in place for each employee that provides the opportunity for growth. Provide training, development, and mentoring programs to your employees to help them build new skills, build relationships, and advance their careers (a definite winwin that will benefit the employees and the agency).
To Feel a Sense of Purpose, Overall Well-Being; Gain Social Connection; and Contribute to Society
What can an employer do to ensure that their employees find meaning and fulfillment in their work? There are number of “subcategories” that I’d place under this one.
STRONG LEADERSHIP
Strong leaders are active and clear communicators. They ensure that employees understand the mission and vision of the organization. They talk about the ways that the agency contributes to the community and positively impacts the lives of customers. They ensure that each employee understands the way that they and the work that they do contributes to the mission, vision, and purpose of the organization. This helps to ensure that employees know that the work that they do has meaning and value and helps to build a sense of fulfillment.
They also understand that communication is a two-way street. They actively solicit feedback and input from employees (more on that in a moment) and consider alternative perspectives.
RECOGNITION, FEEDBACK, AND APPRECIATION
We all want to feel appreciated. Recognize employees and celebrate successes and achievements. Providing feedback, even constructive criticism, lets employees know that they are valued. Constructive feedback gives employees the opportunity to improve in their job performance. Positive feedback shows appreciation for contribution and recognition of efforts.
BUILD A POSITIVE WORK CULTURE
A positive work culture is key to retaining employees. In addition to the things that we’ve already discussed, a healthy culture is dependent upon trust, respect, empathy, cooperation, and accountability (authenticity … fun … humor, the list goes on). Healthy organizations encourage open communication and create a collaborative and supportive environment. Organizations that solicit input and consider the perspectives of all employees have higher levels of employee engagement and lower turnover.
Hopefully ChatGPT and I have given you some things to think about today. Addressing employee retention isn’t a “quick fix,” but the good news is, most of the things that employers can do to improve retention will also improve the performance of the organization. All the things an agency can do to increase the likelihood that employees will continue to choose to be “great” working for them are also things that will contribute to the overall “greatness” of the agency as a whole.
If you’re struggling with employee retention challenges or anything else HR-related, don’t forget that one of the benefits of your IA&B member is expert HR advice. I can be reached at 484-465-1201 and khdigioia@herbein.com.
Karen H. DiGioia provided this article on behalf of Herbein | Mosteller HR Consulting, IA&B’s contracted human resources consulting firm.
