Seismic shift sees employees calling the shots
"You are lucky to work here!"
Many of us are old enough to remember being told that at some point in our career. My how things have changed. Now you are more likely to hear a potential candidate say, "You would be lucky to have me here."
MRA's 2022 Benchmark Compensation Survey has shed even more light on almost every employer's biggest headache -- finding and keeping employees. Not only is base pay rising, but so are bonuses and other benefits in an effort by employers to have a total rewards package that impacts overall employee satisfaction, engagement, and commitment to an organization.
Desperate times call for desperate measures. Employers need people right now and bonuses and pay increases provide immediate gratification and differentiation in the market. Businesses know that may cause problems down the road with wage compression and possibly paying over market rate, but they have products and services to deliver, and they need people to do it ... now.
So what is causing the upheaval? There are a few things at play here:
1. The simple allure of more money and the grass being greener elsewhere;
2. A different philosophy about work, moving from 30 years at the same company to a desire to move every 3-5 years; and
3. The number of opportunities available due to a dramatic change in the marketplace.
Despite all the additions in total rewards, it is still compensation that plays a very significant role in an employee's commitment to their employers. As a result, organizations are increasing starting wages and providing a variety of bonuses including annual performance, holiday, sign-on, referral and retention.
Even with all that, organizations are still reporting problems filling open positions -- specifically, skilled office/clerical and technical positions. Recruiting is difficult in this market, with potential employees having many options in their job search.
While there are several ways to recruit, and no right or wrong way to attract talent, organizations that have a standardized recruiting, interviewing, and hiring process in place have the advantage of moving quickly.
The simple reality is we have more job openings than people applying. Compounding that problem when you look at the job classifications with the biggest jumps in hiring difficulty, they are also the hardest hit by large numbers of baby boomers calling it quits and younger workers participating in the gig economy and "doing their own thing."
To truly differentiate in the marketplace of people, employers need to know what is important to their employees. What do they value? Do the company's benefits match those values? Has the employer asked?
A company could have the best 401(k) match, but if their employees put a higher value on health care, it is a miss. Or maybe they have a young workforce more worried about student loan debt than days off. Regardless, employers need to take action to understand their people's priorities to prevent top talent from leaving.
Bottom line, it is not a benefit if the employee does not think it is a benefit. Today, companies are reevaluating their total rewards package in a more employee-centric environment.
When you consider what your individual employees want or need, that gives you a huge advantage in recruiting and retaining talent.
There has been a seismic shift in the balance of power between the employer and the employee, exaggerated by the COVID-19 pandemic, but inevitable, nonetheless. Creative employers are re-evaluating everything from pay to benefits to how, where and when work gets done in an effort to be the employer of choice in their region.
The employees have spoken.
• Jim Morgan is Vice President, Business Development & Workforce Strategies at MRA -- The Management Association. MRA is one of the largest employer associations in the nation, providing resources to 4,000 businesses annually to help them thrive. For more info go to www.mranet.org