Are Your Employees Planning To Leave?
Are Your Employees Planning To Leave?
Take Actions To Avoid Employee Turnover Now
Are Your Employees Preparing to Leave?
John Holobinko, Managing Director
It doesn’t take a rocket scientist to understand that the job market has changed radically in the last 24 months. There are currently 10.4 million job openings across the United States. Another statistic should raise a yellow flag for every business: According to the US Department of Labor, 3% of all employed workers quit their jobs in September, 2021, the most current data and the same as the previous period. Restated, this means the employee average time an employee stays with a company at less than three years. At today’s rate, the average company’s workforce will completely turnover every three years or less.
In this environment, businesses are trying new ways to recruit new hires. These include higher pay, more benefits and more flexible work conditions. Some are also conducting exit interviews to determine why employees have departed. However these efforts miss a fundamental point: In most cases the employees you have are highly valuable and worth keeping based on their experience and knowledge of your business. They have been trained, you know their performance and the time and effort to replace them is costly. Taking actions after they have turned in their notice is simply too late.
Do you know if your employees are content? Or is it simply a matter of time they turn in their notices one by one?
Here are a number of ideas for potentially improving employee retention that every business can implement today:
- Make sure that your employees are truly empowered. This means the ability to speak up and propose changes, and where appropriate to take ownership for implementing the changes. The more ownership you can get your employees to take on, the more emotionally engaged they will become in your business. If you do not trust your employees to make any decision, the issue is likely you. If this is the case, start with empowering them to make some small decisions to build your level of trust. (Also see my previous blog note on “When not making a decision is a decision”.) If you insist on making every decision, you may soon find yourself alone.
- Here is a novel idea: Instead of waiting to for employees to give notice and then conducting exit interviews, begin to conduct “Save” interviews periodically with your current employees now to get a better understanding of how they feel. A “Save Interview” should be designed to get feedback on what employees like and what frustrates them – the former becomes a recruitment tool, the latter gives you clear areas to focus on for improvements. Then it is up to you to prioritize and implement those improvements. Depending on your company size, In the current environment you may want to go as frequently as a Save Interview once every three months.
- Beware of the new hire compensation trap: When recruiting a new hire you may feel compelled to offer a higher wage than your current rate based on the competition. However, if you do not match this compensation internally amongst your existing employees you will be creating a time bomb of discontent. It won’t take long for your existing employees to feel that they are an under appreciated second class and begin to leave, exacerbating your problem. So what to do? If you have to recruit at a higher pay level, bite the bullet and match that pay with your current employees. But importantly, don’t simply recruit based on pay. If you conduct your save interviews and create a work environment that fosters creativity and ownership, you will be able to recruit using the multiple benefits of your workplace, at possibly not so much of a compensation premium. Remember, if the only reason a new hire joins your organization is for higher pay, that same person will also most likely to leave for the next higher paying job.
- Despite your best efforts in improving your work environment, some employee turnover is likely inevitable. If possible, cross train your employees so that if one of them departs you are not caught in a bind of having no other person that has the skills to do the job. You will buy time to fill the vacancy with the right person, not just a “warm body”. (Make sure your employees understand you are recruiting to fill the vacancy and not just asking them to take on more work permanently.) Cross training employees provides another benefit: If done correctly, it makes employees feel more valuable because they feel less “pigeon holed.
Recognize that this work environment IS the new normal. The workplace has virtually no possibility to going back to the way it was. As a business leader one of your key tasks is to understand how your employees view their environment, and determine ways to improve their productivity and emotional connection to the business. Without this, your business and your results will most likely suffer.
Copyright 2021 Business Reimagined, LLC. All Rights Reserved. Any reproduction of this document must include attribution to the author and Business Reimagined, LLC.