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Unemployment is at record low levels—great news for employees, but not so much for employers.
For the third straight year, employee retention is the top challenge cited by HR managers in a survey by SHRM/Globoforce. According to the ADP report Evolution of Work 2.0, almost two-thirds of employees are looking for new jobs, and many workers not actively seeking new jobs would consider a job offer.
Employee turnover is costly and disruptive—especially for a small business. HR Dive reports that when an employee leaves, companies spend one-third of the person’s salary (an average of $15,000) to find a replacement. With small staffs to begin with, the loss of a key employee can cripple your business, further cutting into profits.
How to Retain Employees
1. Put your money where your mouth is. If employees can get sizable pay bumps by switching employers, it will be harder to keep them on board. Make sure your wages are competitive. Provide opportunities for employees to make more money through bonus or profit-sharing plans. This is more affordable than offering big raises, since you only pay if the company is doing well.
2. Offer employee benefits. Benefits are growing in importance, MetLife’s 15th Annual U.S. Employee Benefit Trends Study reveals. While health insurance is the top benefit employees want, 54% of the employees surveyed also want their employers to provide benefits that help them build financial security, such as a retirement plan. In addition, 58% want the option to choose from a wide range of benefits. You don’t have to foot the entire bill for employee benefits: The majority of workers surveyed are willing to pay for part of their benefits. Choosing a benefits package that gives your employees options is a great way to meet the needs of everyone on your team.
3. Build relationships. Relationships with coworkers and managers are critical to employee satisfaction and engagement, ADP reports. The top reason employees in their survey left their jobs was because of their direct manager. As a small business owner, you’re uniquely positioned to get to know your employees—and how they get along with each other. Take steps to encourage relationship building among employees. Consider celebrating birthdays and other milestones, holding lunchtime potlucks, or starting a bowling or softball league.
4. Provide employee recognition. Everyone wants to feel respected and needed. More than eight in 10 workers in the ADP survey say they want to make a difference at work and feel that they play an important role. When it comes to recognition, little things—like praising employees in front of the team—can make a big difference. Check out these employee recognition ideas.
How to Recruit Employees
1. Plan ahead. Identify your highest-value employees—they’re likely at the biggest risk of leaving. Create a plan for how you would replace them, whether by recruiting outside or inside the company. Cross-training is a great way to build a “bench” so you can promote from within. Create detailed job descriptions for every position on your team if you don’t already have them; that way, you’ll be ready to advertise at a moment’s notice.
2. Keep recruiting. Stay alert for potential candidates on social media platforms such as LinkedIn. Pay attention to people in your industry you might like to have on your team one day. Developing relationships now can pay off in the future.
3. Promote your company as a great place to work. Job candidates will go online to get an idea of what it’s really like to work at your business. Use social media and your business website to share your corporate culture, spread the word about open positions, and spotlight your staff members.
An employee-friendly corporate culture is a strong antidote for the employee crisis. And in the end, it will save you time and money.
Read more on this topic: 6 Things Entrepreneurs Can Do to Attract and Retain Good Employees
Rieva Lesonsky is CEO and Co-founder of GrowBiz Media, a custom content and media company focusing on small business and entrepreneurship, and the blog SmallBizDaily.com. A nationally known speaker and authority on entrepreneurship, Rieva has been covering America’s entrepreneurs for more than 30 years. Before co-founding GrowBiz Media, Lesonsky was the long-time Editorial Director of Entrepreneur Magazine. Lesonsky has appeared on hundreds of radio shows and numerous local and national television programs, including the Today Show, Good Morning America, CNN,The Martha Stewart Show and Oprah.Lesonsky regularly writes about small business for numerous websites and for corporations targeting entrepreneurs. Many organizations have recognized Lesonsky for her tireless devotion to helping entrepreneurs. She served on the Small Business Administration’s National Advisory Council for six years, was honored by the SBA as a Small Business Media Advocate and a Woman in Business Advocate, and received the prestigious Lou Campanelli award from SCORE. She is a long-time member of the Business Journalists Hall of Fame.
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