How to Retain Employees in a Post-COVID Landscape
With the U.S. unemployment rate spiking in April of 2020 to a high of over 14%, employers may assume that the current labor market offers a greater abundance of talent availability than at any point in recent years.
A deeper dive into the statistics tells a very different story.
As the post-coronavirus recovery continues, quit rates have climbed faster than job openings, and the overall Labor Force Participation Rate (61.4%) descended to a 43-year low. Taking industry-to-industry variance into account, employers may be drawing from a tighter labor pool than they were before the virus struck.
The bottom line: employee retention remains as important now as ever.
To find out what businesses can do to keep their employees happy and motivated in the current environment, we spoke to Aerotek Director of Strategic Sales Tim Callaghan.
Prioritize employee retention initiatives
Retention initiatives can be a more powerful investment when compared to the downside associated with attrition. Add up all the costs associated with hiring — total hours spent on talent sourcing, onboarding, production lag costs, etc.
“Companies need to have as much emphasis on retention as attraction,” says Callaghan. “There’s still a war for talent, and retention efforts will be rewarded.”
Investing in employee retention initiatives isn’t as simple as putting a ping pong table in the break room. Especially now, retention can mean restructuring the entire employer/employee value exchange.
“A lot of companies are creating long-term incentive plans, employee loyalty bonuses, increasing base pay to keep up with the market and rewarding high-performing employees,” says Callaghan. “Those strategies are key now.”
Introduce more flexible employment policies
Rigorous employment policies in industries such as manufacturing and distribution have evolved to address production quotas, but the potential risk represented by rising quit rates may be enough to warrant readdressing them.
“If somebody suddenly can’t show up on time due to changes in their children’s schedule, employers need to take that into account rather than sticking to rigid attendance policies that will scare off solid workers,” says Callaghan.
Looser and more varied policies such as work from home, flex time, half shift availability, scheduling consistency or paid leave flexibility can all help persuade employees to stay. Such policies help in their own right, but also demonstrate a level of engagement by management your employees will be more reluctant to walk away from.
“Employees in surging industries like distribution know it’s an employee market,” says Callaghan. “If they don’t feel valued, they know that one of 50 other employers will be available in a 20-mile radius.”
When a warning or pay dock can be easily sidestepped by skipping across the street to another available position, the original employer is often left holding the bag.
Listen to the concerns of every employee
The recent rise in quit rates comes as workers prioritize child care and safety concerns over working. According to a July 2020 Census Pulse survey, more than 34 million working parents of children aged 14 and under have been impacted by reduced or no in-person school or reduced daycare capacity, and more than 37 million workers have an elevated COVID-19 health risk due to age or existing health concerns.
This affects all employees, not just core full-time staff.
“Contractors and contingent workers are not immune to the same household cost-to-benefit adjustments as the permanent workforce,” says Callaghan. “Whether that’s changes in child care, working conditions, or homeschooling — challenges we’re all facing might even be a greater burden on contingent and contract workers.”
Quit rates in heavily contingent industries reflect this added burden.
All employees have new concerns in the post-COVID-19 world. Not just on the job site, where PPE availability, temperature screening and contact tracing can make a difference to the overall value exchange. Employee concerns extend beyond your walls too, with issues such as public transportation and its associated transmission risk now at the forefront of workers’ minds.
Just as each company must understand the specialized local market for their labor, knowing employee concerns on both a broad scale and an individual basis will help define the best retention strategies for your particular situation.
Learning the exact concerns of every employee can be a challenge. Mechanisms such as surveys or one-to-one meetings are potentially helpful, but can also produce mixed results while also straining staff availability.
Consider leaning on your staffing partner for insight into employee concerns related to your specific market, and ask for guidance on retention strategies that have been working well.
And always keep the alternative in mind.
“It’s always better to be proactive rather than reactive. There’s an opportunity now to get ahead of the pack with strong employee retention,” says Callaghan.
To start a conversation about your staffing strategy, reach out to Aerotek.