Unemployment is at a historic low. Jobs are plentiful. And employees are quitting jobs at the highest rate since 2001, according to the U.S. Bureau of Labor Statistics.
Yet, companies are more focused on finding new talent than keeping top performers happy and engaged. “If companies focused more on retention,” says Roberta Matuson, an executive leadership coach in Brookline, Massachusetts, “they may find themselves in a much better place.”
After all, the cost of losing a top performer is far more than just the direct cost of replacing them. In addition, customers who worked closely with departing employees may decide to leave as well. And when good managers leave, good people often follow them. Moreover, if a key person leaves in the middle of an important project they were working on — say, a product launch — the whole thing can be derailed.
The list goes on, but it all adds up to this: It’s important to understand the huge implications when great people leave your company.
Given the high stakes and costs of employee departures, corporate leaders in general need to pay greater attention to how they engage and reward their best team members. That starts with learning what workers today truly value and want from their employers. Here’s what JUST Capital research shows is the answer.
Retention Strategy #1: Pay a Fair Wage and a Living Wage
Notice this doesn’t say “a bigger paycheck.” That’s because making a fair wage and a living wage aren’t about chasing big numbers, they’re about earning a wage that covers the local cost of basic needs — like food, housing, and medical care — and one that is appropriate for qualifications, experience, and performance.
“People want to feel that they’re being compensated for the value that they’re bringing to an organization,” Matuson says.
Our 2019 survey results back this up: Among 29 different issues, Americans deemed paying a fair wage the number-one most important issue when it comes to business practices.
What can company leadership do with this information? Start by conducting a competitive analysis of your pay practices to make sure you’re not losing great people due to below-industry average pay. Here’s how JUST Capital evaluates a company on fair pay.
Leaders should also conduct a living wage audit. Use the Living Wage Calculator from our colleagues at MIT to better understand geographic differences in cost of living.
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Retention Strategy #2: Support Work-Life Balance
Work-life balance has consistently been one of the areas that Americans want companies to prioritize, according to our annual survey. And this doesn’t mean hosting off-site happy hours or offering in-office yoga classes. Employees want companies to make it easier to address work-life balance challenges by offering things like flexible working arrangements and day care services.
These, among other forms of non-wage compensation, have very real financial value and can certainly factor into a person’s decision about where to work – or whether it’s time to jump ship.
If you want to keep your strongest employees on board, it might be time to review your scheduling and personal time-off policies. Are there ways you can offer employees more flexibility? Considerations include the ability to work from anywhere or easily take off time for personal and family obligations, such as when a child or other family member is sick.
If you already offer flexible working arrangements or day care services, make sure you encourage your employees to use them. “A common issue is that companies will have policies and programs meant to offer their employees more flexibility and work-life balance, but managers may not allow all employees to participate,” Matuson says. “Leadership needs to make sure all managers are letting the people who work for them take advantage of the programs.”
Even better? Lead by example, especially if you’re a man. That means taking paternity leave or leaving early for your kids’ basketball game — not through the back door but through the front. By publicly announcing that you’re taking advantage of the flexibility offered by your workplace, you help normalize it and make it acceptable for everyone to do it.
Retention Strategy #3: Make Equal Opportunity a Priority
Needless to say, when employees feel there is bias in the workplace or that not everyone has an equal shot of getting promoted or the best opportunities, they’re going to feel less compelled to stick around.
“If people feel blocked, they’re going to go somewhere else,” Matuson says. “If it’s an ‘old boys network,’ for example, women are going to go to a place where they can break through.”
There are many strategies for building a more inclusive company culture, but one powerful step is to conduct a pay equity analysis and publish the results. Our research shows that when companies prioritize transparency around pay equity, it can be a win-win for both employees and shareholders.
But beyond the business case, performing a pay equity analysis and disclosing high-level results is an essential first step to addressing the persistent gender pay gap in the United States today. And that’s certainly something your employees can appreciate.
Retention Strategy #4: Emphasize Career Development and Professional Growth
Professional growth is important to workers. So when your best people don’t feel like their job is helping them advance in their careers, they may start to explore other options.
“Employers make the mistake of thinking employees want all of these crazy perks, like beer on tap or meditation rooms, but what they really want is for their employer to invest in them and their careers,” Matuson says.
Given the huge array of online courses available today, it’s gotten much more affordable for companies to offer their employees additional training to help them grow their skills. But career development should be tied to the individual employee’s needs and wants. During employee reviews, managers should discuss career aspirations with each employee and consider future roles that would put them on a path to achieving their ambitions — whether that’s a linear promotion within their department or a lateral move that provides new experiences and develops new capabilities.
Rockstar employees are not only interested in their current position. They want to know what they need to do to prepare for what’s next. If you can help them do that, they’re much more likely to stick around and grow within the company.
The bottom line: Keeping employees happy — and not tempted to quit for other opportunities — isn’t rocket science, but it requires ongoing effort. Corporate leaders need to first understand what workers actually want from their employers and then, more importantly, act on it.
To guarantee you’re always up to date on what your employees value most, sign up for our free weekly newsletter, The JUST Report, today!