For employers struggling to compete in a tightening labor market, it is important to realize that in the relentless search for new employees, it is never a good idea to ignore the people already on the payroll. Spherion’s Emerging Workforce® Study found that while both recruiting and retention are top priorities for employers over the next three years, many employers focus more on recruiting than retention. Less effort to combat employee defections has not gone unnoticed. No matter what employers may be doing to increase retention, employees aren’t necessarily getting the message. Nearly one-quarter say their employer does less to retain them this year compared to last, and only 15% say their employer put in more effort. This lack of effort―whether real or perceived―erodes engagement and commitment to the organization. As a result, 26% of all workers say they are likely to look for a new job in the next 12 months. 

Why Employees Leave 

When asked why they want to change jobs, many employees point to pay (or the lack thereof) as a strong motivator―in fact, it’s the #2 reason. Money is always an issue. However, the most common reason for seeking greener pastures is better opportunity elsewhere. Employees also want to feel valued. If they get what they need at their current job―challenges, career paths, feeling valued, understanding their contributions and being recognized and rewarded for their efforts―they will not need to search elsewhere for better opportunities.

Solving the Retention Dilemma

What can employers do? One solution is to re-align workplace initiatives to more closely mirror worker priorities, but what are those priorities? According to Spherion research, employees say that benefits and financial compensation today and growth and earning potential tomorrow are most important to them; employers focus more on supervisor relationships and culture and work environment. These findings are in keeping with the results from nearly 20 years of Emerging Workforce research, indicating this gap in understanding between employers and employees has not closed over time. 

Paying Your Way Out of High Turnover

A tightening job market makes it more challenging for employers to fill gaps in their talent bench. An easy answer (although often a costly one) is to increase compensation. The good news: This is an excellent strategy to employ to help minimize turnover, while increasing consumer purchasing power. That would further spur economic activity, which has languished for a number of years, due to average hourly wage increases that have not yet rebounded to pre-recession levels. The bad news? Money isn’t everything. 

Compensation Sometimes Takes a Back Seat to Culture

Today, workers are looking for far more. Companies will need to shift their thinking about what matters most to both job candidates and the already employed. Employment decisions are no longer primarily driven by traditional benefits―i.e., money, perks, flex-time, etc. A bigger influence is the work environment―factors that impact how engaged and happy people are every day at work. In fact, mission, reputation and team are the new forces influencing job candidates. 

• The opportunity to work for a company with a mission they believe in is important to job candidates, especially younger ones. 
• How a company operates and how it treats customers and employees all feed into reputation, which is readily accessible and increasingly transparent to candidates. 
• “Fit” is often a more critical predictor of success in a new role than skills and experience. One of the key elements contributing to a good fit is the employee’s supervisor. 

On balance, priorities have shifted. These kinds of environmental factors now have greater impact on a candidate’s decision to work for a company than more traditional factors like salary, benefits and work/life balance (56% vs. 41%). Today, workers want growth opportunities, a collegial and collaborative atmosphere, a chance to learn and recognition for a job well done. They want to be happy at work.

Retention Is Just as Important as Recruiting

As important as it is to find new talent to grow your workforce, never lose sight of the performance stars already in place. Align HR practices with key retention drivers for YOUR workforce to create greater incentive for your best employees to seek out opportunities with you rather than with your competitors.

Local Spherion owner Michael Chalmers leads a team that has been serving the recruiting and staffing needs of Middle Georgia employers for nearly 20 years. Founded in 1946, Spherion is a staffing leader with more than 150 offices nationwide. Individually owned, each Spherion office offers clients and candidates the personalized service of a local business, along with the resources and expertise as part of a $2 billion workforce leader. To find out more about how Spherion connects people and jobs, call 478-956-1700 or visit spherion.com.