Melbourne Business School News Why you need a plan to keep your best employees in 2022

Why you need a plan to keep your best employees in 2022

The 'great resignation' is tipped to hit Australia around March next year. Here's what smart managers should be doing to prepare.

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The war for talent is real. In October, SEEK recorded the highest number of job ads in 23 years – 63 per cent higher than the previous year and 44 per cent higher than pre-pandemic levels in October 2019.

Last month, big financial firms such as Accenture, Deloitte, EY, KPMG and PwC posted more than 3000 job ads, while Commonwealth Bank had 700 positions open and Westpac had 690.

The employment landscape is becoming more competitive by the minute and organisations should be fighting to hold onto their talent.

Why is this happening?

In part, the labour supply squeeze comes from limited worker mobility due to border closures and halted immigration over the past two years. However, there is something more significant going on that is transforming the world of work.

In the US, employee scarcity post-pandemic has been coined the "great resignation". Workers are leaving their jobs in droves, making career and lifestyle changes. Some are changing jobs. Others are making sea- or tree-changes and redesigning their lives.

According to research from Microsoft, 40 per cent of the post-pandemic global workforce is considering resigning – and some commentators predict Australia will see the worst of it from March next year.

This may be due to increased government support during the pandemic. Or because people have amassed extra savings while staying home during lockdowns.

Lockdowns have also given space for people to examine their values, priorities and lifestyle patterns – particularly with the rise of remote and hybrid work models. People have had the chance to think deeply about what's important to them, how much emphasis they place on work, and to tap into an underlying desire to have a better lifestyle.

There's been a recalibration of the relationship people have with work, and I see this as one of the biggest drivers behind the great resignation.

We are on the brink of employees exercising unprecedented levels of choice about their next move – whether it be to something more creative, to a job where they feel valued and supported, or to more flexible working conditions that allow for lifestyle changes.

What it means for employers

Managers planning for 2022 would be wise to remember that retaining good employees is far less costly than replacing them. But how can they do it?

A recent PwC survey of 1800 Australian workers found that – after remuneration – 22 per cent valued support of their wellbeing above other factors. This includes mental health support, work-life balance, gym membership and similar.

Another 16 per cent valued their workplace experience, including culture, diversity and inclusion, support, team spirit and co-worker relationships.

These were closely followed by flexible, collaborative and autonomous ways of working; career development in the form of quality leadership, access to mentoring and coaching; formal and informal learning and upskilling; as well as career pathways.

In total, 73 per cent of those surveyed identified care, connection, culture, quality leadership and learning and development opportunities as the factors that matter most.

This gives us some important clues about the levers to pull if seeking to hold on to your best people – and if you're a manager planning for the year ahead, I highly recommend you develop a plan for doing so.

For one thing, there's significant cost involved in finding good talent when an existing employee leaves. Hiring a recruitment agency often requires a fee of anywhere between 15-25 per cent of the position's salary. Throw in the time and internal resources needed for rounds of interviews and reference checks, and the cost goes up even further.

Then, there's the invisible costs of onboarding and training. It usually takes up to six months for a new employee to get comfortable in the role and achieve full productivity. Until this time, they tend to cost the business more than they return – and there's no guarantee they will end up succeeding in the role.

A better approach

To hold onto people who are reevaluating what's important to them and considering their next move, start by recognising that what most employees are seeking is not necessarily a job change, but a renegotiation of their current conditions.

Some are looking to create a better balance – between work and non-work life, but also between the tasks they perform. More employees want to work on projects that interest them, feel rewarding and are aligned with their skills, strengths and values.

But don't make guesses, and don't wait until the resignation letters start coming through. Be proactive and engage in discussions with your employees now to understand what they want.

Ask open questions like: "What's most important to you now? How have your priorities changed during the pandemic? What would make employment more effective for you? How can we shape your role to create better balance?" Then consider the options.

Not every situation will need to be fixed with a pay rise – sometimes, creative thinking is more important. For example, you could:

  • Create development plans that identify skills they want to build and experiences that will create learning opportunities
  • Get them involved in strategic projects that give them greater growth and visibility
  • Support them to find a coach or a mentor
  • Invite them to drive initiatives that align with their values, like chairing a diversity and inclusion committee, joining a working group exploring different flexible working models, or developing a strategy around ESG
  • Ask them to mentor a junior team member or allow them a day a month for external volunteer work
  • Actively remind them to take advantage of the wellbeing initiatives and support available to them
  • Explore options around working from home, compressed working hours or moving to a four-day week or nine-day fortnight

There's no one-size-fits-all approach. Employers need to treat their employees as unique individuals with their own goals and aspirations.

Take the time to find out what your people value most – be it money, lifestyle, career growth or culture and care – and work together to create conditions that meet their needs and yours.

The mere act of listening and seeking to understand their needs will signal that the organisation cares about them. This can go a long way to helping them stay with an organisation that is committed to their professional and personal wellbeing.

You may have to make some concessions, but if you proactively plan to invest in your people, not only will you see fewer resignations in 2022, but your staff will be motivated to perform at their best at a time when you will want to invest in growth rather than to have to fight for new talent.

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Aviva Berzon is Associate Director, Learning Consulting in our Organisational Learning Group. She helps to co-design and deliver on Custom Solutions programs for enterprise and government organisations.

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