Everyone is talking about the Great Resignation, why employees are leaving companies and how to retain employees.
As of June 30, 2022, there were 11 million open jobs in the US but only 6 million job seekers. According to Gallup, 51% of employees are considering a new job. In addition, 25% of all new employees will leave in the first year according to an Allied Mobility Survey. Finding and keeping employees are on every business’s radar and employee retention is more important than ever.
So what’s happening? At the height of the pandemic more than 120,000 businesses temporarily closed, but the economy bounced back and in 2021 added an “unprecedented” 3.8 million jobs. But 3.25 million Americans have left the workforce—labor-force participation among Americans 16 and older is 62.2%, down from 63.4% in February 2020.
It isn’t only the young. Part of the story of job-leaving in America has to do with early retirement. In 2021, older workers left their jobs at an accelerated rate, and they did so at younger ages. They felt able to do so because their houses were suddenly worth more, they had retirement accounts, and they were afraid of getting sick.
According to the Future Workplace, 87% of employers state that improving retention is a critical priority issue. Employers know that replacing an employee can cost 35%-60% of an annual salary but don’t seem to address better onboarding of employees or trying to retain talented ones. In a study by OWL Labs 69% of all new employees are more likely to stay with good onboarding and employers see 25% lower employee turnover where flexibility and remote work is possible.
Here are some of the reasons employees stay with their employers.
Employees want to feel like they are making an impact and making the world a better place, especially younger workers. They want to believe in the company’s mission and vision. For example, in my company, JorgensenHR, everyone knows that our vision is “to help people, both employers and employees.”
Employees also want to feel valued, recognized and respected and have exciting and challenging work, in a pleasant and satisfying work environment.
Employees today are looking for a better work-life balance than in the past and focus on career growth, learning and development. Employers often hear “what is my next move?” or “where does this job take me in the long run?” They are looking for mentors that can help them chart and navigate their careers.
Employees that have a great relationship with their superiors stay much longer at companies. The number one reason people leave companies is due to their boss. Most employees only hear from their supervisors when they do something wrong and there is not enough or no positive reinforcement.
Pew Research reported in March 2022: “Those who quit and are now employed elsewhere are more likely than not to say their current job has better pay, more opportunities for advancement and more work-life balance and flexibility.”
Lastly, employees want to be paid well, have great benefits and incentives for excelling. Employee benefits used to mean vacation, medical, dental and vision but now include retirement plans, financial education, mental health counseling, employee assistance plans and meditation.
In many companies, employees enjoy gym memberships, massages and yoga which have been added to the menu of wellness benefits employees are looking
If you want to explore some of these employee retention ideas give us a call at JorgensenHR.