Recognizing that many of the factors that drove resignations in 2021 and 2022 still exist, effective leaders focus on employee attraction and retention.
Work Transformation|Health and Benefits|Employee Experience|Ukupne nagrade |Benessere integrato
N/A
The U.S. employee quit rate decreased in July to pre-pandemic levels for the first time since February 2020. Does this mean the “great resignation” is over?
The Bureau of Labor Statistics reported resignations are down substantially since peaks in late 2021 and 2022, as are hire rates and job openings. Media mentions of the great resignation are also down from previous years, and many experts have proclaimed the trend over.
While relieved that quit rates are down, effective leaders understand that many of the conditions driving the great resignation remain present and unemployment remains relatively low. They recognize that workforce demographics and elements of the working world have changed and will not revert back, even as more employees return to traditional workplaces. They also know that while employees today may be more likely to stay with their employers because of increased risks in the economy, they will be more engaged and productive if they feel valued and are treated fairly.
During the disruption of the past three years, effective leaders retooled their organizations to adopt new talent strategies and create places people want to be. They knew that the headlines of the pandemic missed the fact that far more people were hired in 2021 and 2022 than quit and that the great resignation was to some extent a misnomer: The vast majority of those who quit one job moved right into a different, more attractive one.
For the last several years, effective leaders created value propositions and employee experiences to drive success, setting their organizations apart by:
Considering the value of flexibility. According to a recent WTW survey, companies expect over half of their employees to work either fully remotely or hybrid in three years, compared with only 15% before the pandemic. Effective leaders have learned that organizations that provide workers with the flexibility to work where and when they want enjoy a significant competitive advantage in attracting talent over less flexible peers. They also understand that not all workers can or should work remotely, but that in-person workers also appreciate flexibility in terms of shift schedules, work styles and other elements of the work experience.
Listening to employees and seeking understanding. Effective leaders know that employees value being seen, heard and understood in an environment where it is safe to share perspectives. Engaging employees through active listening (formal and informal), acknowledging needs and concerns, and communicating with empathy, compassion, transparency, dignity and recognition leads to greater engagement and less likelihood of quitting. It also provides valuable insights that can help shape and prioritize programs around employee needs and preferences.
Transforming pay and benefits. To increase employee engagement and performance, effective leaders update pay and benefits programs for both new hires and existing employees. They ensure that pay is competitive and fair in shifting labor markets. They pay for critical skills in a changing world of AI and digitilization. They offer short- and long-term incentives that are tied to performance. They continue to modernize and personalize health benefits, and savings and retirement plans, which are a top priority of employees in an uncertain environment.
Being sensitive to inflation while managing costs. Effective leaders aim to help employees understand that while inflation and salary increases generally move in synch and impact each other, they are driven by different factors. They understand that this difference tends to make employees feel advantaged in terms of real spending during low-inflation years and disadvantaged during high-inflation years. Independent of inflation, pay increases generally are expected to remain high as long as unemployment remains low. Because pay increases lag inflation, effective leaders are careful not to dismiss employees’ concerns about inflation just because it is coming down, while also managing costs in an ever-changing environment.
Focusing on wellbeing at work. Effective leaders know that healthy employees drive healthy organizations. They provide critical benefits that may include time off, caregiving support (for children, special-needs adults and elders), flexible healthcare and emotional wellbeing benefits that can be accessed at or near the worksite or home or virtually. They also ensure financial wellbeing support that includes education and access to programs tailored to demographic groups and specific needs, including re-skilling, while focusing on workload balance and skill development to help workers stay productive and engaged. They also establish a direct connection between employee wellbeing and business outcomes.
Reinforcing culture, values and purpose. Research continues to show that a focus on culture, values and purpose differentiates effective leaders. Leaders who start with purpose and stress values create continuity in company culture while their business models and daily operations disrupt and transform. They drive a healthy company mindset around characteristics such as agility, tolerance for risk taking, innovation, safety (physical and psychological), wellbeing, fairness, dignity and belonging, which are needed to support growth and drive high performance. They create inclusive environments where employee voices are heard and respected. Data suggest organizations with such transformative employee experiences are far more likely to report lower turnover than those that lack such definition.
Effective leaders understand the importance of enduring talent practices and remain committed to them regardless of the external environment.
A version of this article originally appeared on Forbes on Septmember 15, 2023.
