Firms still face a fight to retain top talent
Pssst:.. Hey, all you managers out there. Here's a tip: Forget about the slowing economy. Forget about all the layoffs. And don't be smug about those college graduates who've become more interested in finding stable jobs than stock options.
The question of the hour: Are you doing enough to keep your workers happy?
It's something every employer should be considering right now - despite the nation's cooling economy, according to a range of workplace consultants and experts. Although layoffs make headlines, they say, the real news is that keeping good workers on the job is more important - and harder - than it has ever been.
"Retention is critically important," says Roger Herman, CEO of the Greensboro, N.C.-based Herman Group and a futurist who concentrates on workplace trends.
He's gone so far as to issue a warning to companies: "We've said, You're fools to layoff your people, because you won't get them back."
Holding on to employees makes good financial sense, too. Experts estimate it can cost as much as 2 1/2 times an employee's salary to replace him or her once you allow for the costs of recruiting, training, and the like.
Experts say the urgency of the employee-retention issue can be chalked up in part to changing times: The number of jobs nationwide is expected to continue to grow for the next several years, even as the number of potential employees to fill those jobs continues to shrink.
In fact, by the year 2006, according to the US Bureau of Labor Statistics, there will be 151 million jobs in the country - but only 141 million people to fill them.
Even today, amid a downturn, an estimated 400,000 jobs remain open. And for employees who've been laid off in recent months, finding new jobs has been relatively easy - most find new work within an average of five weeks, experts say.
The retention issue is also driven by changing attitudes - specifically, changing employee attitudes. Over the past five to 10 years, the New Economy has brought new ideas about work, including a "free agent" mentality among employees and a greater comfort with changing jobs on a regular basis.
"Thanks to the New Economy, we've woken up to the fact that employees realize their careers are in their hands," says Beverly Kaye, a consultant and co-author with Sharon Jordan-Evans of "Love 'Em or Lose 'Em: Getting Good People to Stay." "They've taken the ball, and they're running with it."
In recent years, many employers have responded to the tight job market with "work/life" programs designed to accommodate employees' lives beyond their day-to-day work duties.
Dotcom companies became infamous for pioneering many of these perks, including catered lunches and free car-wash services. But the mainstream workplace hasn't been far behind: Today's work/life programs include everything from flexible work schedules and programs to help workers care for older relatives, to on-site dry-cleaning, photo-developing, shoe-repair, and errand-running services.
"At the core of all this ... is anything that focuses on time, because time is such a huge commodity," says Cathy Saka, a work/life consultant for Hewitt Associates, an international employee-benefits consulting firm. "Our clients are coming to us and asking us to draft programs that focus on giving employees more time..., so that employees don't have to make five stops on the way home."
Although some companies have cut back some of their work/life programs as the economy slowed - or postponed big-ticket projects such as on-site childcare - many workplace consultants say that overall, companies are sticking to their commitments to make workers happier.
According to a Hewitt survey of 1,020 major employers, released in April, the percentage of employers offering some kind of work/life benefits continued to grow in 2001 despite the economic slowdown. Some 91 percent of companies offer some kind of childcare assistance; 48 percent offer some form of eldercare; 78 percent offer opportunities for personal and professional growth, including education reimbursement; 32 percent offer benefits to adoptive parents; and 57 percent offer some kind of on-site personal services, ranging from ATM machines to dry cleaning and travel services.
"Even with the slowing economy, [employee retention] is still a critical business driver," says Jeff Brown, vice president of organizational effectiveness at First USA Bank, who developed an award-winning career-development program for the bank's employees.
"We sell products and services to our customers," he says, "but the people who drive that on a day-to-day basis are our employees. It's critical to retain their knowledge, their skills, and their abilities, if we're going to remain customer-service oriented."
The program developed by Mr. Brown began in 1999 with 2,000 employees and is expanding to include First USA's entire workforce of nearly 11,000 employees. It involves individual skill-building workshops, on-site career resource centers, and individual career counseling. So far, the program has been a success: Attrition is 65 percent lower among employees who have gone through it than among those who haven't. One side result of the program, he says, has been increased promotion from within the company.
"From a business standpoint, we wanted to increase retention," he says. "From the employee standpoint, we wanted to give them tools that would help them."
Experts say that even executives and managers who feel pinched by the current economic situation can still do something to keep employees happy. Casual dress, for example, doesn't cost a penny, but may help increase employee morale.
Job titles also make employees feel valued. Though jokes are sometimes made about the proliferation of "chief" titles - from Chief Vision Officer to Chief Culture Officer - experts say titles express a company's commitment to a certain focus, as well as to an individual whose work merits attention.
Ms. Kaye, for example, found one of the employees at her consultancy cared deeply about having the title of vice-president - something Kaye says she would never have known unless she had specifically asked her employee what she needed to feel better about her job. The woman, she says, deserved - and received - the title.
In fact, say experts, taking time to ask employees about their needs and interests - and to listen carefully to their answers - may be one of the cheapest but most effective ways to keep employees happy.
(c) Copyright 2001. The Christian Science Monitor