It’s hard to recall a time when the job market has been more competitive or weighted towards the employee. Employees either stopped working or started working from home during COVID; many of them now don’t want to return. We are in an unprecedented situation. The demand for workers is at an all-time high and the supply in the workforce is low.
Employees have discovered they don’t want to spend their time languishing in cubicles. They only want to work if it feels valuable to them. Telecom companies, internet companies, renewable energy, finance companies, healthcare, IT, all these companies are going to need to find employees in a market where hiring is slim.
Large employers are going to be raising wages to control workspace and hire experienced, talented employees. How can smaller and mid-sized companies compete?
Improving Company Culture
Many employees are quitting because they want to continue working from home. They would rather not have a job than go into the office. Many Americans saw their work-life balance diminish throughout the last decade. They want to reclaim that work-life balance now and have discovered that working remotely is the answer. By improving company culture — using flex-time, work-from-home, milestones vs. hours worked, and otherwise providing excellent benefits — employers can acquire and retain the best talent.
Employees don’t tend to leave companies. They leave managers. When employees are happy with management and colleagues, they stay. Besides raising wages, providing flexible work hours, & better healthcare benefits, employers can do the following to improve their company culture to attract & keep their employees:
- Listen to their employees. Provide a work environment where employees feel comfortable to speak up to make their opinion & suggestions heard. Employees want to contribute to the success of their company; they simply need the opportunity to do so.
- Clearly communicate your company’s values & mission. Employees are 51% more likely to be engaged when they understand the direction & values of the company.
- Encourage collaboration by having a “team” mindset vs. a “me” mindset. This creates an openness to share new ideas & what was learned.
- Build trust by sharing relevant data & information, as this helps inspire productivity & motivation.
- Provide regular feedback, more than a yearly review. If employers get into the habit of letting their staff know when they do a good job (not just the bad jobs) they know where they stand & know what is expected of them.
Improving company culture is one step toward better relations with everyone.
Raising Wages (and Why It Works Better Than You Think)
Conventional wisdom is that millennials and zillennials prefer soft benefits rather than wages. But that’s true only to an extent. Most of those studies are for high-value areas; areas where people are already making $80,000 or above. There’s a reason why Bank of America is raising its minimum wage. And many other companies are following suit.
When employees are making less than $75,000 or so, they are generally still wanting for money; they still have debts that are pressing on their minds and they are more likely to want to see raised wages. Raised wages translates directly to better employee retention, which ultimately saves the company money and removes disruption. Happy employees help businesses thrive because they want to have an impact & feel like their work matters.
It’s true that retaining top talent costs a lot less than hiring a new employee. Turnover costs vary depending on the industry, but on average, it costs 20% of the annual salary to train & hire a new employee. Companies that invest in their current employees have happier workers, higher productivity, and less turnover, saving companies a lot of money.
Participating in Creative Marketing
What’s also true is that employees want to work for companies they believe in. Many companies are now participating in creative marketing that shows off their brand identity and company culture to attract new talent by giving them a peek “behind the curtain” so they know what it’s like working at that company. By communicating the company’s values in their brand messaging, companies can position themselves in such a way that shows they focus on, and place an importance on, their employees. Potential employees gain a clear expectation of their job as well as the values of the company to determine if the company will be a good fit for the employee too.
Other companies are working with high school students directly, planning to equip them with internships and salaries. Coding bootcamps, for years, have been providing opportunities for individuals who finish the camps — with the knowledge that they have the skills they need to succeed. Some are offering childcare, $30,000 bonuses, and more.
It’s true that employees are in demand right now. It’s an employee’s market; they can pick and choose where they work. But that isn’t going to last forever. As the economy rebounds, some employees are going to feel the pressure to get back to the 9-to-5. It’s important that companies not fall backwards into this way of thinking, however. Companies that use the strategies mentioned above will be able to position themselves to be able to take advantage of this influx of new talent and get the best-of-the-best for many years to come.