For months, we’ve heard about the Great Resignation. Some people believe what’s going on with employee quit rates and the struggles in filling open positions is temporary.
I’m not one of those people.
The worker shortage is here to stay, even if we move into a recession.
Why is this?
Short answer: demographics. The largest labor pool on record (Baby Boomers) is now retiring.
Their children (the Millennials and Gen Z) are expected to inherit $68 trillion from their boomer parents by 2030, making them the wealthiest generation in history.
So, if you think the labor shortage is terrible now, wait until this generation starts receiving their inheritances!
The Labor Shortage is a Challenge Globally
I just returned from vacationing in Europe, and here’s what I observed.
- Some businesses are doing a great job of staffing their organizations. They are retaining their regular business hours, while others are cutting back their operating hours due to lack of staff.
- Businesses all over the globe are feeling the impact of the labor shortage. In London, trains are being canceled due to a lack of labor and what’s most surprising to me is how transparent the rail service is about this. The train boards announcing arrivals, departures, and cancellations state the exact reason for a canceled train—labor shortage.
- Everywhere I turned, there was a help-wanted sign. One sign, in particular, drew my attention. The sign read, “Help Wanted. We’re Getting Cranky!” I can relate, as I was getting cranky waiting an awfully long time for service in restaurants.
Here’s What This Means for You
It’s easy to get caught up in the trap of thinking, “Well, at least I’m not alone. Everyone is having this problem,” when instead, you should be thinking, “I have a great team. What do I need to do today to retain these people?”
With that in mind, here are three things you can immediately do to double down your employee retention efforts.
- Get to the root of the problem.If you’re experiencing a significant decline in employee retention, don’t assume you know the source of the problem. Do your due diligence.Case in point. I recently worked with a client who was confident they knew why employee turnover spiked. I came in with fresh eyes and discovered their assumptions were way off target.
Once they knew what the exact problem was, the company was able to implement the right solution. Within a few months, employee turnover was slashed in half. Employee referrals started to rise, and they can now fill open positions more quickly as they continue to grow.
- Seek to fill jobs internally. Many people are quitting their jobs for better opportunities, which means if you’re unable or unwilling to provide advancement opportunities, somebody else will.
Start by looking at the long list of requirements you’ve established for a particular job. Can some of these skills be quickly learned by someone familiar with how your organization operates? Is a college degree necessary for someone to succeed in a particular role?
Many companies are eliminating college degree requirements to attract and retain the needed workers. These companies are instead focusing on skills-based hiring to widen the talent pool. Some are going one step further and implementing mentoring and apprenticeship programs. This idea is worth considering as you look at ways to promote from within.
- Make sure your leaders aren’t repelling talent. I recently spoke with a coaching client who told me about a conversation he had with his boss. I’ve been around the block enough times to know that this manager doesn’t know how to lead.My client is now actively seeking a new position, as we both agree that things won’t get any better where he is. It’s a shame because he’s excellent at what he does and has the most seniority in the organization. The company will be losing a valuable asset when he departs, and no doubt others will follow suit when he resigns.If only the organization were willing to provide this leader with a coach. I can assure you that the investment needed to do so is far less than the cost of replacing this person.
As you look at ways to retain employees, think about providing your people with something that your competitors can’t (or won’t) give them—outstanding leadership!
© Matuson Consulting, 2022.
Over the next several months, I’ll be hosting a Masterclass titled, The Great Refusal to Work Lie, for CEOs, Business Owners, and Senior Executives interested in rapidly staffing their organizations with the right people AND retaining these people. Reach out to me at Roberta@matusonconsulting to apply for a complimentary spot. The group size will be limited to ensure everyone has ample time to have their questions answered.