Employee Turnover and How to Win The War

According to a recent Forbes report the labor market is shrinking. There is already competition for top talent, and it appears this economic cycle will be here for a while:

“The headline report adds new jobs and subtracts quits, layoffs, retirements and other separations. The gross rate at which people are quitting is now three million people per month, twice what it was in the recession. And companies are trying to hire, both to replace quits and retirements and also to expand. Six million open positions show up in the official reports, and businesses would certainly hire even more if people were available. But this recent economic growth is not the whole story. The tight job market will continue for a decade or more.”

The impact is crippling for many employers. Josh Bersin estimates the total cost of losing an employee – which includes such factors as lost productivity, knowledge drain, and company morale – at a stunning 1.5 to 2.0 times the employee’s annual salary.

In addition, there is a longer hiring cycle.  At an average 27.6 business days per position, the lag time between posting new jobs and getting them filled is already well above pre-recession levels and approaching its highest mark since the turn of the century.

This new trend in unemployment will necessitate some new strategies including: 

Reassess your total compensation package — but not all compensation comes in the form of cash. Employee discount programs and other perks like flexible work hours can be inexpensive, and retooled recognition programs are yet effective ways to boost your overall benefits package.

Invest in people -- Job skills training, for example, not only pays off in overall productivity – lessening the need for additional FTEs – but individuals with career development opportunities report higher levels of overall job satisfaction. Supervisory training is a similarly critical piece of the puzzle, as more than half of U.S. workers have reported quitting a job to escape a bad manager.

Leverage technology to expand productivity -  computing power and technical innovation has led to an explosion of targeted, low-cost productivity apps for virtually every department within an organization.

Tap into global sources of labor - reach out to staffing organizations that specialize in international outsourcing. You may discover opportunities to test (even temporarily) the skills and quality of global talent for various positions at a relatively low cost.

Tap the power of your own employees – now is the time to implement an employee referral program that awards your employees for introducing a family member, friend or acquaintance to work for your company. 

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