Economic Growth Causes Retention Crisis

b loehr - recruit retainIt’s a good news, bad news situation.
The good news: including figures through December 2015, the U.S. has experienced 69 consecutive months of private sector job growth. Yay!

The bad news: this trend, a major reversal from the financial crisis and recession period of 2007 to 2009, has created recruiting and retention challenges and even talent shortages in some areas of the workforce. Boo.

“It’s the No. 1 issue for H.R. professionals,” according to Chason Hecht, president of Retensa, an employee retention consulting firm. Hecht notes the problem is “pervasive across industries, but some are hit harder than others — like health care,” a sector scrambling to meet the demands of an aging population.

As the economy improves, and job options flourish, it causes employers concern about retaining their most valuable asset – a productive workforce.

So, what’s a business to do? Begin addressing the situation by grasping how the employee’s view of the entire employment picture has changed.

Past generations considered a lifetime position with one company the desired goal. A worker was likely to be content with whatever pay and benefits were offered because job security topped the list of employment aspirations.

Younger generations no longer hold to this way of thinking, a fact proven by how employees “shop” for jobs every few years in the same fashion they “shop” for a new car. The Internet has opened a plethora of doors to anyone seeking a job or simply checking in on “what’s out there.” There are more ways than ever before to “shop around” your skill set and qualifications.

Money still talks, but engagement often talks just as loudly. While a pay increase may head off an immediate departure, job engagement is where it’s at. Many employees will stick around – some even for less pay – if they truly love the position, feel valued by the company and believe they are an integral part of the “bigger picture.”

On the other hand, retirement concerns have begub to take center stage as traditional pensions have all but disappeared. For today’s employees, retirement confidence is strongly tied to their access to a retirement plan whether it be a defined contribution (DC) plan, a defined benefit (DB) plan, or an individual retirement account (IRA). The portability of 401(k)s are an added incentive to change jobs should the right opportunity present itself.

Communication and transparency are also keys to retaining employees. Workers want to know how the company is doing and receive explanations concerning the how and why of financial decisions that affect them and their pay. Being left in the dark suggests they are valued less to the company and will nudge them toward the door.

Considering all these factors, strategize with your management team about specific ways the company can actively seek to retain the trained workforce you’ve worked hard to assemble.

B. Loehr Staffing recognizes how the rapidly changing business environment can force quick, significant shifts in workforce requirements, and we offer a reliable resource to meet those needs. We will communicate clearly, frequently and honestly concerning your hiring needs. Contact us today.