We are firm believers that showing love for your people and creating a great working culture provides many advantages, a key one being that good people want to stay.
Some of the recent vacancy headlines seem to have sprung out of nowhere. We seem to have been propelled forward from a severe concern about unemployment rates post Lockdowns in 2020 and 2021 to:
“Salaries set to skyrocket in 2022 as firms try to retain employees”; “Employers warned to expect challenges as vacancies reach another record high”; “The ‘Great Resignation’ has created a seller’s market “ “In a buoyant jobs market, firms need to take a holistic approach to retention”
Showing love for your people and developing a culture where high performing people want to work might be more important than ever in the current climate. Becoming an ‘Employer of Choice’, one where current employees love to work and others would love to work with them, is not an overnight task but not to go on that journey may have its consequences.
While the general outlook for the economy is encouraging, the consensus is that competition for talent will remain ‘fierce’ with fewer candidates looking for each job and that in the UK employers face a challenging time ahead as the latest official figures show vacancies hitting another record high while unemployment continues to fall.
Indeed, the Office for National Statistics (ONS) revealed that the number of job vacancies in the three months to December 2021 rose to a record high of 1,247,000 in the UK, an increase of 462,000 on the three months to March 2020 when the first lockdown came into effect.
Jonathan Boys, labour market economist at the CIPD, said overall the figures were “encouraging” and showed that the furlough scheme ended “with a whimper, rather than a bang”. But he said: “The landscape of low unemployment and high vacancies poses challenges for employers’ recruitment and retention efforts.
Some pundits such as Jack Kennedy, UK economist at Indeed, predicted that wages would be the main tool for employers to attract talent in a tight market. The particularly in-demand sectors include nursing, construction and food services were all seeing above-inflation pay increases.
“Employers are having to fight ever harder to prize recruits away from their existing jobs or persuade them to pass up job offers from other companies,” he stated. “This battle for talent is being fought primarily with ever-increasing wage rises.” However, Hannah Slaughter, senior economist at the Resolution Foundation, warned that despite talk of “wage spirals”, the UK really was facing shrinking pay packets. This fall in real wages probably started as early as last summer and could continue into next summer, she said, cautioning that it was likely to get worse before it gets better. So there are some contradictory views regarding wage inflation.
Paul Farrer founder of Aspire ( An award winning digital, media and marketing communications recruitment specialist ) predicts that high staff turnover rates would keep vacancy levels high for some time, but that as markets return to pre-pandemic levels, the vacancy rates would begin to fall. As such, he recommended firms focus on staff retention and not just recruitment.
In the very recent past many employers assumed that staff mainly leave for more money and that with low inflation and a tight jobs market retention would not be an issue. As a result, too little attention was perhaps paid to the prime factors that attract and retain staff such as:
work/life balance
appreciation of changing generational expectations of work
career opportunities
organisational culture
Work culture could be said to have been overly focused on short term productivity gains over a a focus on retaining high performing staff. This was partially because some employers thought, mistakenly, that there would always be a “bottomless pool” of potential new recruits.
Why do companies need to reconsider their Attraction and Retention Strategies in order to keep their Talented people? The why is easy to answer-the costs involved.
Staff retention is becoming a key metric again with good reason. The average cost to recruit a new employee is £11,000 per person. For specialist roles, the turnover cost can be significantly higher due to the amount of time and money that you need to spend to train them recruitment and staff turnover are expensive involving loss of training investment. The UK employee turnover rate last year was 15%.
Some Key Steps Organisations, Large and Small, can take to Retain Staff
Know The Culture of Your Organisation - how does it feel to work around here? For example, many businesses still rely on annual surveys to find out how their employees feel about their work. Not only is asking these questions once a year nowhere near sufficient, but they are usually anonymous, and findings are rarely and adequately acted upon. A much more effective methodology is to conduct regular ‘stay’ interviews where employees are interviewed on the reasons they choose to remain with a business. This builds a much clearer picture of what a business is and isn’t doing well and employees feel valued by even being asked the questions. Whether it’s through “stay interviews” or any other mechanism, opening dialogue with employees is an important step towards building better relationships between the workforce and line managers.
Know Your Staff “Workplaces rarely see the whole human being they have employed for years” Marcus Buckingham. A recent Gallup poll of more than one million US workers found that the main reason people quit their jobs is because of poor relationships with bosses or immediate supervisors. And three-quarters (75 per cent) of workers who resigned from positions did so because of line managers rather than the position itself. And even sadder, fifty-two percent of exiting employees say that their manager or organisation could have done something to prevent them from leaving their job. But only about a third of former employees said they had a conversation with their manager about leaving before they quit.
Know how Engaged your Staff are with the Organisation’s Purpose Again, Gallup has also found that employees who are not engaged or are actively disengaged in their work and workplace are most likely to be those who are actively looking for a new employer and watching for openings elsewhere.
Help Managers to Manage and Lead Staff Well In order to retain staff and enable excellence to emerge- when the organisational message has been anonymous productivity. In such cultures any human being has no reason to “give of themselves”-to extend discretionary effort-go the extra mile. They will often comply with regulations and just do enough to get by whilst potentially looking for better options.
Marcus Buckingham in his new book “Love +Work” talks about releasing the energies of staff by finding out what they love doing. He stresses the importance “Job Crafting” in order to build upon their signature passions and strengths to increase performance, reduce burnout and increase retention of Talented people. He describes a simple managerial habit of Weekly check-ins-just ask two questions each week and then really listen.
Q.1 Last week-what did you love/loathe?
Q2.This week- What are your priorities and how can I help?
“Lastly, here’s a quote from a recent McKinsey Report “The Great Attrition stems from a great disconnect”. “There’s a clear disconnect between why employers think their employees are leaving and the actual reasons behind employee exits. Our survey results found that employees were far more likely to prioritize relational factors, including feeling valued by their manager and organization, and having a sense of belonging. In contrast, employers were more likely to focus on transactional factors, such as inadequate compensation and work–life balance. October 18, 2021”
If you’d find it valuable to talk through how you might develop your culture to become an employer of choice and support your managers to lead staff well. please contact anne@taylorclarke.co.uk and Anne will arrange a call with one of our expert consultants.
Christine Hamilton
Christine is an experienced occupational psychologist; team and individual coach; and leadership & management development specialist. She worked for many years as a manager of large numbers of staff in a range of local, regional and national offices and as a result she adopts a pragmatic approach to training and development. Christine works as a consultant/occupational psychologist/ coach providing consultation to a large variety of organisations in the public, private and not for profit sectors.
References:
Marcus Buckingham “Love + Work” series of webinars in conjunction with Harvard Business Review in advance of the publication of his book “Love + Work” April 2022
CIPD Reports
“Salaries set to skyrocket in 2022 as Firms try to retain Employees” 11 January 2022 Caitlin Powell
“The Number of Job Vacancies in 2021 was double the previous year” 17th January 2022 Jasmine Urquhart
“In a Buoyant Jobs Market, firms need to take a holistic approach to Retention” 10th January 2022 Lynn Smith
Vilip Gandhi & Jennifer Robison “The Great Resignation is Really the Great Discontent” McKinsey Report October 2021
John Hagel III, Maggie Wooll, John Seely Brown (JSB) “Human inside: How capabilities can unleash business performance” Deloitte Insights June 2020
John McGuire “People will continue to leave their Jobs because of Managers” Arabian Business December 2020
Israel Sanchez -Cardonna, Maria Vera, Miguel Martinez-Lugo “When the Job does not Fit: the moderating role of Job Crafting and Meaningful Work in relation between Employees’ perceived overqualification and Job Boredom” Journal of Career Assessment June 2019
Jessica Van Wingerden and Rob F Poell “Meaningful Work and Reliance among Teachers: The mediating role of Work Engagement and Job Crafting” Public Library of Science (PLOS One) September 2019
.