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The ‘Great Resignation’ — as it has been coined — is the widespread case of people quitting their current job in pursuit of a new one or something completely different. While some may blame it on the pandemic, the reality is our job market and how we work are evolving. Small businesses have always had more to contend with when it comes to attracting and retaining talent, but the current situation has made it particularly challenging.
If you’re struggling to keep employees right now, you’re not the only one. According to the Labor Department’s Job Openings and Labor Turnover Survey, the quit rate was 2.9% in August. While that may not seem high, it equates to 4.3 million Americans quitting their jobs.
Colorado is no exception to the difficulties posed by the current job market. According to the U.S. Bureau of Labor Statistics, average earnings for Colorado workers rose $1.33 an hour to $31.84, which is $1.30 higher than the national average for July. While there are many pros and cons of running a business in Colorado, the quit rate for our state has also been trending with the national labor market.
So businesses in Colorado are dealing with an equally high quit rate and even higher labor costs. And even though Coloradans lost unemployment benefits back in September, it’s still been a challenge to hire and retain employees.
While many employers would like to use the pandemic as an excuse for employees quitting, it’s only the trigger to an underlying cause. Employees recognize they hold the power and are reevaluating their current situation for a variety of reasons:
But if you read these through these reasons, they can still be mapped back to the top four reasons employees have always left a job:
To compete with hiring employees and retaining the ones you already have, you have to make some changes in each of the areas above. Small businesses are uniquely equipped to do this. Larger organizations move slowly and may be out of touch with their employees. Small businesses can use their agility and ability to communicate to their advantage.
Employers must put their people first to hire and retain employees through the ‘Great Resignation.’ Every organization has been putting out communications about the pandemic and organizational changes. Instead of talking at employees, now is the time to let employees speak.
One-on-one meetings, team outings, or all staff meetings are a great opportunity to gather employee feedback. However, if you haven’t been frequently doing these before, be clear about why you’re doing them now. Singling certain people out or suddenly holding meetings can make employees nervous. Some questions to ask your employees:
Once employees provide feedback, employers should take action. Asking questions helps identify which areas need improvement (e.g. salary, benefits, leadership, work-life balance, or career development). Sometimes it’s not just one of these that a business needs to evaluate. For example, you can’t excel at work-life balance and get away with poor leadership — there needs to be a balance between all four.
Offering raises is nice but small businesses may not have the means to pay employees more. Bonuses are an alternative option. For example, the Colorado Restaurant Association found one in four restaurants added bonuses this year to attract workers.
It doesn’t have to be all about pay either. Benefits or low-cost perks are another great way to add value for your employees. With open enrollment coming up, this is the perfect time to evaluate your benefits. Take a little extra time this year to see how you can reduce benefit costs as a small business while improving your benefits and benefits administration.
Many employees left their last job due to how their company and leadership responded to the COVID-19 pandemic. Let’s be honest — no one knew how to navigate this situation. But companies who reflect on their experience and find ways to improve upon it will have a better chance of retaining employees into next year. It’s also critical that business leaders stay up to date on vaccine mandates.
For some though, the pandemic merely brought to light problems in the culture. Working remotely was challenging, and organizations that didn’t have a strong culture beforehand suffered as a result. Workplace culture can be a vague thing, but it’s possible to identify problems in your culture and fix them.
No matter how small you are, trouble in your company culture impacts employee morale, creates undue tension in the workplace, hurts relationships with customers, and even stifles innovation. It’s the responsibility of a company’s leadership and human resources team to cultivate a positive culture.
Get ready for this one — according to Prudential’s Pulse of the American Worker survey, 1 in 3 workers do not want to work for an employer that requires them to be onsite full time.
But there are considerations for remote work and small businesses. If you have the means to work remotely — great. But many small businesses, like those in retail, food, construction, etc. can’t offer remote flexibility.
So if you can’t offer remote work, think of other ways to improve your employees’ work-life balance. Work with them on scheduling, provide mental health support, or share ways to reduce stress to combat burnout and other life challenges.
Many employees will be looking for advancement in the coming months. The pandemic allowed a lot of us to prove our worth to our organization. Identify your high performers and reward them before it’s too late.
The value of investing in your people is far-reaching. Better retention and productivity are just a few benefits of developing your employees. It’s not always about handing out a new job title or promotion. Are you teaching employees new skills and providing them with the opportunity to do the things they actually want to do?
Last, are you rewarding and recognizing your employees? It doesn’t have to take much. Some low-cost options include lunch with the boss, an extra day off, a gift card for coffee or dinner, or some company swag. Sometimes a little token of appreciation can go a long way.
Don’t just make accommodations for new hires or employees who are threatening to leave. Employers looking to retain their best employees need to make changes across the board — before employees start looking.
And at the end of the day, you might lose some people. Don’t be too hard on yourself. To learn more about how you can retain your employees, download our guide below.