Best Practices: Retention in the Workforce
On Friday, November 4, 2022, Jessica Dixon, LSI’s Chief Human Resources Officer (CHRO) took the stage at Fall 2022 Nubiz Symposium at the Ogden-Weber Chamber of Commerce. Here is what Ms. Dixon discussed:
What’s Happening in the Labor Market?
In the past few years, the United States has experienced historically low unemployment rates. Utah currently has a 2.1% unemployment rate while the nation sits at an impressive 3.5%. Between these low unemployment rates and a booming economy, many jobs that employers are posting are going unfulfilled. The job to person ratio is 3:1, meaning for every 3 jobs open, there is one person available. Since jobs are readily available, job seekers are on the job market for an average of 17 days. Meaningful talent is difficult to capture when there is such fierce competition among employers.
Because there are so many available jobs and opportunities available for the workforce, the pressure is one to keep your great employees – more than ever. Turnover, hiring, and training cost organizations a pretty penny and employers are actively looking to retain their current employee base.
Why do people leave?
But why would people want to leave – other than the plethora of jobs and opportunities outside of their organization? Well, it’s complicated. Competing studies will say it’s pay or benefits, other say toxic work culture environments, and other studies claim it’s a lack of flexibility and/or poor management. The easy answer is to point to pay and compensation, but usually, that’s only part of the story.
Some of the reasons people leave include:
- No growth opportunities
- Lack of appreciation, support, or trust
- Stress from overwork
- New job offers
- Career/school changes
- Better work/life balance
- Lack of purpose or fulfillment
- Poor leadership
- The job was not what the employee expected
- & Many more…
Other leading predictors of turnover include job insecurity and reorganization, prominent levels of innovation (as in, companies move so quickly that they burn out employees), failure to recognize employee performance, and poor response to COVID-19. Failure to recognize performance could mean that high performers don’t feel like they’re being rewarded for their efforts, or they feel that low performance is being tolerated.
On the other hand, it’s usually detrimental to get this sort of feedback from a job seeker in an interview. When an interview hears the job seeker say things like, “I’m looking for a new job because I hate my current job, it’s toxic, I dread going to work and my boss is a jerk, and the coffee is terrible, and product sucks…” Red flags pop up everywhere. People are smart enough to know that they need to be professional and not paint their current situation in a bad light – though you do get the odd overly honest job seeker occasionally. If you really want to know how someone’s last company/culture was, ask them about it two or three months later, when the dust has settled and they’re comfortable in their new working environment. Like relationships – at first the conversation goes “it just didn’t work out, great person though,” and six months later the same name comes up and the reaction becomes “ugh, what a loser… what was I thinking?”
When employees do leave, there’s a statistical probability that they’re leaving around their work anniversary or birthday. Work anniversaries, whether they’re joining the company or moving into their current role, are natural points of reflection. Job-hunting activity jumps by 6% and 9% respectively, at those points. Birthdays – particularly midlife milestones such as turning 40 or 50 – can prompt employees to assess their careers and act if they’re unhappy with the results. Job hunting jumps 12% just before birthdays. The big realization with both milestones, is that it’s not just what happens at work that determines whether an employee starts looking for a new job – it’s also what is or is not happening in their personal life, too.
But why do they stay?
Asking why people stay at a position usually has the same answer as why people leave – it all depends. However, it’s not necessarily the clear opposite of the reasons why people leave.
As an example, consider the national divorce rate. If someone were really interested in learning more about it, they would have to understand why some people get divorced and why others stay married – the reasons for these two situations are completely different. Furthermore, the reasons for getting a divorce are not merely “just the opposite” of the reasons for staying married. The person would have to do some real digging on both sides of the fence to get a complete picture of the divorce phenomenon. Equally, in the corporate setting, there are definite rationales for terminating and definite (although sometimes unconscious) rationales for continuing.
Some reasons people stay are:
- Coworker relations
- Job security
- Supportive, positive managers who provide fair feedback
- Better pay and benefits (tangible rewards)
- Career planning and development
- Organizations who have clearly established goals are viewed as desirable places to work
- Job continuity
- Work life balance
Additionally, if an employee believes in the company’s mission and future vision, is asked for input and ideas, has a strong sense of purpose, and is trusted by leaders, they are likely to remain at the company or organization. Employees value integrity, transparency, involvement and belonging, and recognition and appreciation. When all these elements are combined, they create an engaged employee who is engaged in furthering the company’s work.
For example, more Baby Boomers (46% of surveyed population) reported that flexibility in work hours or schedule would make them stay long-term at their organization than Gen X (38%), Millennials (31%), and Gen Z (24%). Sedentary workers (20% of the population surveyed) were more likely to say flexibility in the work environment would make them more likely to stay at their company long-term than active workers (11%). Active workers (66%) were less likely to feel valued for the work they do than sedentary workers (75%).
What Can We Do?
Like how you stay married, it starts with the right partner. The best marriage advice Jess ever received was “Marriage is hard enough – imagine it with the wrong person.” The same goes for work.
So… what are the right steps to retaining good employees?
- Start with the right people
If the recently hired employee is not working out from the start, it’s probably either going to be a shortchange, or a long and painful process to endure. It is well worth your time to invest extra time in determining what you need and who the right folks are to do the job correctly.
- Set them up for success
Be clear about expectation in the beginning – people want to succeed. When setting them up for success, understanding clear expectations from the beginning can help employees transition from a new career or position easier.
- Get to know them
When first meeting an employee or getting to know a long-time colleague, it’s vital to meet them where they are. Understanding who they are, what they care about, what’s important to them, and how you can support them will create a trusting, valued environment for the employees. However, what’s important for an employee will change over time. The things that were important to you at 21 years old may be different when you’re married, turn 40, or experience life for what it is.
When Jessica was graduating college, she was looking for an opportunity. She was willing to trade long hours and even pay to learn everything and grow. As she has progressed in her career, she’s decided she does want more compensation to show for her progress, and as she’s raised a family, flexibility and benefits became her key priority. That is all to say – the cycle always continues.
But how did her priorities change? How did her managers assist her on her path? These changes came from regular discussions and career development goals (both professional and physical). Good managers should have a solid pulse on their people and seek ways to understand what their team needs. If managers can’t identify through discussion, or through getting to know their team, they should outright ask them in their coaching or development sessions.
- Be open to changes
Don’t stay rigid – your business, and people, will change over time. People will want different things over time and their career. Will it always work? No – sometimes you simply must explain that you don’t have any more resources, you can’t pay them more money, or allow them to work from home or to adjust their schedule.
So, what, then? If you can’t help them meet their new needs, then wish them well. We would even go as far to say that we should help them find what they’re looking for.
- If they still go…
If you’ve done all the above, and it is still no longer a good fit, then wish them continued success. These individuals can be your biggest advocates or detractors.
Your biggest billboard and advertisement to future employees are your current and former employees. If you remember from earlier – you do not want them unleashing after three months at their new workplace. You do want their feedback to be open and honest, and if you create a good relationship before they leave, you have a direct line for that person for a long time. Sometimes, the grass is not always greener on the other side, and you have boomerang employees that come back. If you have an amazing employee where you cannot meet their needs (ex. They move, etc.), they will come back to you if you part on good terms.
Seasons change and people evolve, but some things never do change – and that is how we treat our employees and how we create sustainable, thriving workplaces. People need competitive wages, or they will not want to continue. People need flexibility to work in environments that work best for their needs. People need managers who are actively seeking ways to help them succeed. People need support in all areas of their lives – both professionally and personally – and creating a workplace that can do both creates a happy, fulfilled employee.
If you would like to reach out to Jessica or learn more from our team, please reach out to us at email@example.com today. We would love to further the conversation.
If you are interested in joining the LSI team, please visit our careers page to see what positions we have open. If the position you’re looking for isn’t open right now, please fill out the form attached on the Careers page.