The good news for the economy is that lots of people have jobs. And jobs. And jobs.
Mainly younger workers are now job-hopping on average every 2.8 years! And with 7.1 million openings, there are fewer reasons to worry they won’t find work. In September, the national jobless rate declined to its lowest since December 1969, from 3.7% to 3.5%. Local areas followed suit as state after state hit record levels of employment this Fall, including California, New Jersey, and Illinois. Massachusetts has been at a record 2.9% since April.
But if you are an employer struggling to find good people, it is the hires and separation data that worries you the most and here is why:
Note how the hires and separations (quits/fires/layoffs) data are closely aligned. Nearly two-thirds of the separations are quits. That means that talented employees are on the move, jockeying for new opportunities that will enhance their careers. Gaps in resumes no longer seem to worry them because, for some, changing jobs is the new job security. You see, talented young professionals know that in this economy, it is easier than it has been in years to boost personal, professional, and financial growth by trading positions every few years. And the economy supports their efforts.
Are you wondering how to tether some of this mobile talent to your firm and reduce your costly employee turnover? Get them to stay longer than 2.8 years? It’s time to revisit three not-so-new incentives to keep top workers and increase the competitive position of your employment offerings.
Hire Them and Keep Them with Benefits that Matter!
- Give your workers a financial incentive to stay. This seems like an obvious answer, but this year’s annual 2.9% wage growth figure is the measliest increase since July 2018. With lower corporate tax rates and a recovering economy, it is time for employers to step up their pay rates. Rewarding existing employees with a respectable raise shows appreciation and is a hallmark of an ideal workplace. 2019’s average pay bump is expected to be 3.1% according to Aon’s U.S. Salary Increase Survey. Higher performance workers and hot metro areas are expected to fall within the 4% range. If your business has recovered and can afford it, share the wealth.
- Focus on bonuses and incentives using variable pay. An interesting fact in Aon’s study was that variable pay is expected to rise from 12.9% to a record level of 13.1% in 2020 as a percent of payroll. To attract the talent you want, increase your investment in things like signing bonuses and discretionary performance compensation. Other lifestyle perks such as HSAs and FSAs, tuition loan assistance, paid family leave, 401k, paid time off, or identity theft protection shows that your organization’s core values are about people and not just product ̶a key decision factor for the new workforce.
If you are a small business, a SEP IRA or profit-sharing plan rewards performance and helps workers save for retirement. Keep people on-board longer by rewarding longevity with more paid time off. These are affordable ways to show employees their loyalty is valued and recognized. Offset by the high cost of turnover and onboarding, at $4,129 according to research by SHRM, a variable pay scheme can help protect your fixed costs while giving you recruitment tools to attract top talent and keep them.
- Make work meaningful. We cannot say this enough; people value work-life integration more than any other generation, so it is up to you to create the type of organization they are attracted to. A focus on opportunities for growth will entice talented people to stick around and create the stability you need.
Make sure your corporate culture supports new standards based on values and community. Assess diversity, inclusivity, and philanthropy. These factors are important to millennials when considering company culture. Consider new skills and personal development training, communicate a path to promotion, and create a dynamic, fun, and modern work environment to boost your standing among employment options.
Give Partnership Employment’s staffing specialists a call today to help find the perfect candidates to fill your requirements. They understand what candidates are looking for and how to make sure your offer connects with their needs. And if you call them, you will not waste time digging into research on current wages in your area, types of benefits, or cultural requirements necessary to negotiate with top talent. Close the revolving door and call Partnership Employment to find great candidates today!
