We have all heard about the Great Resignation over the past year and have probably read many perspectives on whether it is real or just a myth. Regardless of your position, the reality is the Great Resignation (or whatever you want to call it) is another wake-up call that we cannot take our staff (and managers) for granted. As a small business owner, the prospect of losing half of my staff and managers is certainly scary. So, I thought it would be timely to look at what is real, why things may be accurate, what is a myth, and what opportunities small business owners have to get ahead of their competition.
The reality is, coming out of the pandemic, many people are looking or planning to look for a new job in 2022. The reasons for this are plenty. There has been some pent-up demand to change jobs as people have avoided making a change during the pandemic. Many employees and managers adapted to working from home and have decided they do not need to go back. They upgraded their home office and technology, enjoyed more time with personal priorities and passions, such as family, enjoyed the lack of a commute, and did not miss a draining and demeaning work environment. We also have some people, particularly older workers, who wanted to avoid COVID and, therefore, retired early or had to look for a better situation that considered their condition. While working from home, some people had time to reflect on their professional career and current role and decided that it was not much of a career. They had little opportunity for growth, and the work they spent more time doing than anything else offered little meaning. Inflation has also caused more people to think about how to earn more money, so there has been a conscious focus on upgrading from a low-paying job to a better one. This desire has aligned well with several companies willing to invest in training people with no experience, allowing those with lower-paying jobs to upgrade their working situation.
All the reasons listed above provide insight into why people chose or are planning to resign in 2022. However, for the most part, these reasons have been in place for several years. Fuller and Kerr noted in Harvard Business Review in March 2022 that from 2009 to 2019, the average monthly quit rate increased by 0.10 percentage points each year. More people have been resigning each year for the past 12 years. The reality for the past decade is that employees have started to emphasize company culture, how their manager treats them, and their overall work experience. As a result, companies have slowly started to understand that employee experience is not just a human resources thing but a business thing that every company, regardless of its size, must take seriously.
Many small business owners we work with and know have a hard time thinking about investing in their employee experience. They are often just trying to survive and have staunchly believed that the customer is their most important area of focus. While they are not wrong, they fail to recognize that their staff will ultimately determine how well their customers are taken of and whether the business will survive. Staff also determines owners’ health and well-being, as they allow owners not to need to be in the business 24/7.
So, what can you do? The good news is that there are plenty of easy and inexpensive opportunities for you to retain your best people, so here are eight things you can do now to give you some relief from experiencing higher turnover among your ranks.
With inflation rising, people will be looking for opportunities to earn more. However, don’t assume this means you need to pay the most. As a small business owner, regardless of the labor market, you need to provide a competitive wage that reflects your location and a person’s experience or skillset. You need to stay current with what your competitors offer and what defines a competitive wage for your industry. Companies should not increase wages based on the cost of living over the cost of labor. Ultimately, a competitive wage is expected, and you can do other more important things to keep your best people.
Rather than trying to guess what your people want, ask them. A “stay interview” is a structured conversation that identifies potential departure red flags while considering career and development opportunities. Here is a list of potential questions:
Not only does this conversation help your people feel valued and heard, but the insights you gather can help address any pain points before a person gives notice of leave.
Regardless of whether you realize it, it is difficult for people to leave a business when they have great relationships with their co-workers, managers, and the owner. Humans are social creatures, and while coming to work is about doing work, a person is just as likely to want to go to work for social engagement. As the manager or owner, get to know your employees better, understanding their personal and professional priorities and passions. Make sure you celebrate milestones and achievements, create opportunities for staff to get to know each other better, and consider how you can make a person’s family feel that they matter. (I recommend sending a thank-you card home to your employee’s partner or family.) The workplace has never been just about work, but now it means even less in relation to your ability to keep your people around.
Be as flexible as you can with work arrangements (while still meeting expectations that pertain to quality and quantity). You need to be clear (and honest) about what work needs to be completed onsite and what has more flexibility. Although responding to people’s needs may cause some reshuffling, you may be able to reallocate talent rather than just lose them for nothing. Creating a hybrid environment that tolerates a mix of home and office is probably ideal. If you have resisted investing in technology, changing management habits, or giving people options because you were hoping everything would just go back to normal, it’s time for a rethink. Remote working is not going away, so develop some processes and guidelines around it, so, when possible, your people do not go away, too.
While the pandemic’s immediate impact on the world and workplace will hopefully wane soon, it has undoubtedly caused long-term changes to how we work, travel, and think about hygiene. Some people will continue to be cautious, wear masks, and be concerned about the spreading of viruses and bacteria. If nothing else, our workplaces should just be a lot cleaner. Be aware that as we drop mandates and relax our concerns, those who continue to protect their health could be singled out and biased against. If some people want to feel safer at work by wearing a mask or keeping their distance, then we need to, like everything else, respect their views and needs. We must promote an inclusive culture where everyone, regardless of their position on COVID, their views of the world, their background, ethnicity, or orientation is made to feel valued, and they belong.
Too often, companies allow bad managers to hide in plain sight. These managers usually do well at their core management tasks and run an efficient operation, but they do so at the expense of their staff. They disrespect and disregard their staff, believing in an outdated view that they are better than and above those who work with them. A manager’s actions, attitude, and words define a workplace culture more than anything else, so when a manager bullies or harasses staff, they should go. You know who those managers are and have tolerated them for too long. It is now time to move on from them for the sake of your staff and business.
Workers, especially younger ones, are actively looking for training opportunities to support their careers. While larger organizations often offer more formal opportunities, which is an advantage, all companies can still prioritize learning and development. Keep in mind: Only about 20% of what a person learns comes from formal training. On-the-job training makes up about 60% of the learning that occurs in the workplace, and another 20% occurs when managers share their expertise and experience and give constructive feedback. One of the advantages of a small business is its ability to give workers more responsibility and the opportunity to learn more on the job. So, if owners or managers uphold their leadership responsibilities of coaching, providing feedback, sharing tips and tricks to work successfully, and giving staff control over their work so they can take risks and learn without fear of being fired after one mistake, then they fulfill this vital need. You also must have career conversations with your staff.
Half of all employees leaving this year will do so within the first 90 days. This turnover results from not setting new-hires up for success, connecting with them when they first start in their role, nor hiring the right person in the first place. It is very tempting to hire the first person who applies, and it is even more tempting only to look for people with experience to avoid spending much time training them. However, hiring people without considering their attitude creates a short-term fix but potentially long-term dysfunction. Be very thoughtful when hiring someone to ensure they have the right attitude and aptitude for learning, think on their feet, and take care of your customers.
These actions may not stop every employee or manager who is looking to leave from resigning. Still, they will go a long way to enhance your culture and give you the best opportunity to attract, engage, and retain the best talent.
Want to get started with your recruitment strategy - email our team at smallbusiness@sgeinternational.com.