- How has the great resignation changed employee-employer dynamics?
- Why is it so important to retain skilled employees?
- How do you use favorable benefits and working conditions to retain employees?
Q: How do you retain employees in the modern era?
A: Many employees are abandoning their jobs for two key reasons: Lack of flexibility and inadequate pay. By giving employees at least some control over their schedules and increased financial security, you can dispel fears and help them feel more independent.
At the height of the pandemic, millions of employees suddenly had an epiphany.
It was a simple realization – but one that sent shockwaves through the entire business world.
Almost in unison, these workers thought to themselves:
“I’m worth more than this.”
According to the Pew Research Center, the vast majority of workers who quit during this so-called “Great Resignation” cited low pay and the complete lack of opportunities for advancement.
They also stated that they walked away because they felt disrespected.
And can you really blame them?
It’s no secret that wage growth has stagnated – despite rapidly rising costs for just about every necessity imaginable.
The statistics are somewhat misleading.
Between 2020 and 2021, wages and salaries in the United States rose by 4.5 percent. Taken at face value, this is the fastest annual increase since 1983.
But what about inflation? Well, that’s the million-dollar question, isn’t it? In 2021 alone, inflation was 4.7 percent.
This means when you actually factor in the reality of life in the United States, wages fell by 0.2 percent in 2021.
We all know that inflation has become much worse since 2021. In May of 2022, the rate of inflation was reported to be a record-breaking, 40-year-high of 8.6%.
Make no mistake:
Workers are being paid in dollars that are rapidly declining in value. This means that despite what the statistics may suggest, they’re earning less and less as inflation continues to rise.
Let’s not forget that the “official” inflation numbers are highly manipulated, and the CPI doesn’t even take into account things like the skyrocketing housing market.
The real inflation rate is much higher than the reported numbers.
So with all that said, it becomes clear that workers have very valid reasons for walking away from their jobs.
And the Great Resignation isn’t over, either.
According to CNBC, 20% of workers say that they’re planning to change jobs within the next year.
As a small business owner, you can’t do anything about the rise of inflation, the unfettered money printing, and the crippling cost of living in the United States.
So what can you do?
How can you retain employees in an era where workers are constantly jumping ship in a quest to find a real living wage? What’s the best way to figure out how to keep employees from leaving the company?
How do you stop your best performers from betraying you and joining your competition?
Many entrepreneurs rely heavily on their employees. Without them, their businesses would crumble.
But as uncertain as the future might look, there’s a light at the end of the tunnel.
If you learn how to keep key employees from leaving and make it through the next few years, you could be well-positioned to beat out your competition, gain a foothold in your niche, and rake in even more profits.
Easier said than done, right?
Read on, and you’ll learn exactly how to retain your employees and keep your business firing on all cylinders.
- How has the Great Resignation changed business?
- Why Is It So Important to Retain Your Employees?
- What Can Your Small Business Do to Retain Skilled Employees?
How Has the Great Resignation Changed the Employee-Employer Dynamic?
Before we get into how to keep employees from leaving, let’s take a step back and think about how we got into this mess in the first place.
According to Harvard Business Review, the “Great Resignation” wasn’t a sudden event. Instead, it was part of a larger trend that has been manifesting for over a decade.
Since 2009, an increasing number of workers have been leaving their jobs voluntarily. When the lockdowns and the quarantines were put into place in 2020, the trend faltered slightly. But in 2021, it continued onwards as usual.
Because voluntary walkouts dipped slightly in 2020 before skyrocketing once again in 2021, it gave us the impression that the “Great Resignation” came out of nowhere and was purely pandemic-related.
In reality, it probably had more to do with increasing economic pressures and stagnating wages.
These are not new problems.
But the pandemic may have highlighted these existing issues, especially when workers were given the chance to stay at home and reflect on their work/life balance.
Many concluded that their pre-pandemic lifestyle just wasn’t worth it as they developed a newfound appreciation for their families, their hobbies, and their passions.
Many decided to create their own businesses.
Of course, this sense of freedom and self-expression was cut short when stimulus checks stopped arriving in the mail, and workers were forced to return to work.
But the lessons were not forgotten. Workers realized the importance of work/life balance, and they became much more aware of other options.
Working from home became the holy grail. Many workers began searching for new opportunities that offered greater flexibility.
Perhaps most crucially, some were willing to accept lower wages in return for greater freedom.
Business owners certainly took note of this shift. Suddenly, their workers had a newfound sense of entitlement.
They understood their value, and they were willing to spend a little more time searching for better positions.
Previously, many workers felt as though having a job was a privilege, and that one should hold onto their job for dear life. Sure, you could search for a better job – but that came with risks.
Better just to stick with your current job, accept the low wages and ill-treatment, and be thankful you even have a paycheck in the first place.
That was the logic of yesteryear.
Today, that employer-employee dynamic has been severely rocked.
Employers are now having to fight for their employees – not the other way around.
Today, they’re racking their brains as they try to figure out how to keep employees from leaving.
Sometimes, the grass really is greener on the other side. This is a lesson that workers in the United States are learning as they scan the job market for the best possible opportunities.
Why Is It So Important to Retain Your Employees as a Small Business Owner?
But why even bother trying to figure out how to keep your employees from leaving?
After all, you can always hire other people… right?
You’re the one with the plan, the entrepreneurial talent, and – perhaps most importantly – you’ve invested your hard-earned money into the business.
You’re taking all the risks, calling all the shots, and guiding the company in the right direction.
Why should you care about some lowly employee who is in charge of a tiny aspect of your business?
Doesn’t valuing your employees send the wrong message, giving workers way too much power in the current era?
Shouldn’t we be trying to reverse this trend by quite literally “showing them who’s boss?”
Losing Key Employees to Your Competitors
First of all, you need to consider where your employees are going when you lose them.
That’s right, they’re heading straight for your competition.
Let’s not forget that some businesses simply cannot function properly without employees.
And if your competitors are draining away your best talent while you’re left scrambling for anyone with a fourth-grade education, it doesn’t take a genius to figure out what will happen.
If you’re running a small business, these challenges become even more pronounced. Competing with massive corporations was already difficult enough.
Now you have to try to outbid major enterprises that can afford to raise wages simply by digging into their limitless bank accounts.
If you can’t figure out how to keep employees from leaving, your business will go the way of the dinosaur.
Keeping Talented Professionals
To evolve and carve out your niche in this highly competitive world, you need skilled employees.
While some might argue that average, unskilled workers are replaceable, the same cannot be said for truly talented professionals.
Your business may rely heavily on these savants. In fact, some of your highest-ranking employees might be the very reason your business is profitable in the first place.
Don’t simply dismiss this possibility when confronted with the possibility of losing key personnel. Sit down and think very carefully about what might happen if you lose your rock star employees.
Long-Term Employees Help You Build Your Brand
Whatever happens, you definitely don’t want your business to become nothing more than a revolving door – a mere “waiting room” in which your employees spend a few months before being lured away by bigger companies with better wages.
With long-term employees, it’s easier to build a unique work culture – a brand that has a very particular (and effective) way of doing things.
If people are constantly coming and going, no one is going to know what’s going on in your company:
“Who filed that report?”
“Oh, that was Jim.”
“Where is he?”
“He left us for Google last week.”
“I need to ask him questions, and he’s the only one who knows anything about this report!”
“Too bad. I guess we’ll have to write a new report from scratch.”
Situations like this can lead to serious confusion, and they’re more common than you might think in the current era.
The Ethics of Employee Retention
Finally, a company that treats its employees well is much more attractive compared to a soulless corporation with highly questionable labor practices.
Today, consumers are more ethically-minded than ever before. Why? It’s pretty simple:
Most consumers are workers themselves.
They know what it’s like to work for a terrible company, and they’re not going to buy products that were created through the ill-treatment of people just like them.
By creating a positive work environment that respects even the lowliest worker, you’re sending a positive image – one that consumers will both celebrate and directly support.
How to Retain Your Top Employees
Here’s the most important question:
What’s the best way to figure out how to keep employees from leaving?
The first step is to identify why most employees jump ship in the first place:
- Inadequate Pay
- No Opportunities for Growth
- Poor Flexibility
While workers may quit for a wide variety of different reasons, those are the key factors you need to keep in mind.
To start, let’s tackle the first and most obvious factor:
As previously mentioned, inflation is going up while wages are essentially remaining unchanged. This means that searching for better wages isn’t just beneficial – it’s essential.
If workers can’t find better-paying jobs, they’re not going to be able to maintain their current standard of living. CNBC reports that two-thirds of Americans are living paycheck to paycheck.
In addition, credit card debt is at an all-time high in the United States.
This means that even with their current wages, workers are finding it difficult to make ends meet.
Don’t take it personally when an employee leaves you for a better-paying outfit. They might just be trying to put food on the table and survive.
So if you’re trying to figure out how to keep employees from leaving, the obvious solution is to simply offer better pay.
Easy enough… right?
Well, that might not be an option for many entrepreneurs who are getting crunched by inflation just as hard as workers.
With that being said, sometimes you need to bite the bullet and offer higher wages, especially if you can’t figure out how to keep the best employees from quitting.
Letting these key workers go could cost your business much more than a 15% raise.
Of course, you could also consider cutting other jobs in order to offer your key personnel higher wages.
For example, you could dismiss your receptionist and hire a live receptionist in their place.
These live receptionists don’t cost as much as their in-house, full-time counterparts. In addition, they’re available 24/7 and can be specially trained to communicate with your leads and customers.
If you’d like to learn more about live receptionists, check out the Alliance Virtual Offices Live Receptionists.
Now let’s move on to the second main reason employees leave their jobs:
Lack of Growth Opportunities
Let’s face it: Everyone likes to feel important.
And when someone is stuck at a relatively low-ranking position for most of their adult life, it can really start to gnaw away at their self-confidence and pride.
If you’re trying to figure out how to keep employees from leaving, consider giving them room to grow.
You don’t necessarily need to promote them right away – but at least give them the impression that advancement is possible.
You could even invent a new title for them to signal the importance of the work they do. A slightly higher wage and a bolstered new job description could go a long way.
When a person rises from “Associate Manager” to “Co-Managing Lead,” it can do tremendous things for their pride – even though these two titles are essentially identical.
Of course, real advancement is also a solid choice – especially if the employee is truly ready to take on greater responsibilities.
Keep an eye out for young talent and immediately earmark them for leadership roles.
Most importantly, inform them that they’ve been earmarked for leadership roles.
Last but certainly not least, we have…
As previously noted, the pandemic and the rise of “work-from-home” positions was a revelation for many workers.
Suddenly, tens of millions of Americans realized that they didn’t actually need to go to the office in order to earn a living.
Because of a minor invention a few decades ago called the internet, workers can be just as productive when they’re sitting at home.
Of course, this logic doesn’t apply to all workers – especially those who are easily distracted by their cats. And some jobs simply cannot be completed from home, no matter what.
But if you can offer your employees even a slight glimpse of flexibility, control, and independence, you should do everything in your power to make this dream a reality.
In many cases, employees are more than willing to accept slightly lower wages if it means they can work from home, hang out with their family, and set their own schedules.
This is definitely something to keep in mind if you’re running a small business that simply cannot compete with more substantial wages offered by bigger corporations.
If you’re serious about revolutionizing your company and striding into a brave new virtual workspace, you should consider the benefits of a virtual office.
Sometimes referred to as “flex space,” these offices can be booked whenever you need a conference room or a workspace.
This means that you can say goodbye to traditional office space and all of the crippling rental costs that come along with it.
Better yet, you can put these savings towards higher wages for your employees while simultaneously offering them greater levels of flexibility and independence.
For example, Alliance Virtual Offices offers virtual offices in a wide range of different cities around the United States. You only pay for this office space when you actually need it, and it’s ready to go at a moment’s notice.
AVO’s meeting rooms let you gather up your team for discussions about upcoming marketing strategies, business plans, or anything else you need to talk about.
Working from home is great, but sometimes you need to have face-to-face discussions to brainstorm effectively and hash out the details of important plans.
Or why not use your meeting room for an office party, a team-building exercise, a training room, or an interview room for new hires? The possibilities are endless when you save money and increase flexibility with AVO.
Where Does This Leave My Employees and Me?
The bottom line is simple:
If you offer your employees decent wages, give them a chance to grow, and offer them enough flexibility, there’s no reason you should be losing them to the competition.
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- The Great Resignation looks set to continue — 1 in 5 say they’ll change jobs in the next year
Although we’re heading into uncertain times with inflation and stagnating wages, it’s important not to panic – even in the face of a Great Resignation that shows no signs of slowing down.
When you step back and examine the bigger picture, this is actually a time of great opportunity.
Evolve, adapt, and figure out how to keep employees from leaving. 2022 could be a very successful year if you manage to accomplish this goal.
You could be one of the few businesses left standing after this transition period is over.
If you make use of effective services offered by Alliance Virtual Offices and value your key employees, there’s really nothing stopping you from becoming one of the most attractive companies in America for prospective employees.