Times are challenging and retention matters more than ever. Unemployment rates are high, yet recruiting is difficult. Work abounds for many firms, yet it’s changing and it comes amidst economic uncertainty. Why is recruiting challenging? Here are a few of the reasons:
- Increased competition for top talent
- Rising salary expectations
- A shift in work-life balance priorities
- The impact of remote work options influencing job preferences
Recruiting challenges and economic uncertainty make retention all the more important. When asked about retention, I’ve heard short-sighted employers respond, No problem. We’ll just replace them. There are at least four reasons why retention matters, regardless of the unemployment rate and economic uncertainty:
- Make no mistake, the people who will leave you voluntarily when unemployment rates are high will be your best and brightest. They’re the very people you never want to lose, let alone when you’re challenged to be more productive and creative.
- The high cost of replacing employees, notably your best employees, is less affordable during uncertain times.
- Return on investment is especially important during uncertain times. The same efforts you make to retain employees will engage them to work more effectively and productively to help you remain adaptable and profitable.
- Neglected and restless employees will jump ship en masse when times become more stable again and you need them for ongoing productivity and profitability.
How can you ensure retention, especially of your stars and rising stars? Compensation plans are often the first retention tool employers consider and compensation has, indeed, become more important in recent years. However, research tells us that when people are paid within industry norms and earn enough to pay their bills, compensation is no longer their highest motivator.
What are the key factors that keep employees from seeking greener pastures? Several years ago, the Gallup organization strongly – and positively – linked the following five questions to retention:
- Do I know what is expected of me at work?
- Do I have the materials and equipment [and knowledge/information] I need to do my work right?
- Do I have the opportunity to do what I do best every day?
- Does my supervisor, or someone at work, seem to care about me as a person?
- At work, do my opinions seem to count?
More recently, Gallup and Meisha-ann Martin found that, Across a number of industries, employees who received high-quality recognition on the job were 45% less likely to have left that job between 2022 and 2024. They noted that recognition is especially important to the younger generation of workers.
With these five questions and an increased emphasis on recognition, you can build a roadmap to retention. You can build a roadmap that, with diligence, can be followed and will help you retain the most valuable asset of any professional service firm, your people. Delineate clear expectations for your people, both staff and professionals. Consistently communicate those expectations. Identify people’s strengths and use coaching to develop those strengths.
Do your leaders and managers know how to leverage individual and team strengths? Do you have a culture of caring, where people have an opportunity to be heard and to influence outcomes? Do you consistently show appreciation and provide recognition? Do you provide learning and career growth opportunities?