Talent shortages are a global phenomenon. Rather than attempting to recruit in a tight market, here’s how to do better at retaining existing staff. By Donna Benjamin

In mature economies around the world, talent shortages are a serious issue. As it becomes harder and harder to find quality talent on the open market, retaining existing staff becomes ever more important. The trouble is, when it comes to retaining staff, many employers are going about things all wrong.

In the paragraphs ahead, the leading error driving talent out the door today will be discussed. Key retention solutions will also be discussed, along with perspectives on why these retention strategies are working right now. One early hint? Even in the midst of the Great Resignation, many employees’ key values haven’t changed, but their ability to express and act on those values has shifted dramatically. Ready to learn more? Let’s begin…

This is not a problem that can be solved with money

Compensation has long been a motivating factor in turnover. It’s also true that of those who’ve left their jobs in the last 24 months, the vast majority are currently enjoying wage increases of nearly 15 percent. So money is the problem, right? Wrong, wrong, wrong. Some 89 percent of employers think employees leave for more money but in reality, only 12 percent do, according to the latest research from Gallup.

To entice a highly engaged employee out of their current role for another position, research indicates that recruiters would need to offer a salary increase of 20 percent or more. Often, that’s not happening. What is happening is that employers are failing to appropriately care for their workers, creating dissatisfaction and disengagement, which in turn motivates those workers to look for other jobs. Once a worker has decided to leave, salary bumps to try and retain them often are no more than a temporary fix.

Instead of cash, offer flexibility and autonomy

With money off the table as a leading retention strategy, what’s a trouble firm to do? Two fantastic places to start are with flexibility and autonomy. These are big hot buttons for workers, and especially for workers from the younger generations. Flexibility covers both where, when, and how work occurs. Does the job have to be done in an office, or can it be done remotely? Offering remote or hybrid options to all eligible employees is practically table stakes these days, so any employer not currently offering that benefit should have a very good reason why. When work occurs is another major factor in modern retention. Flexible scheduling – with things like open schedules, flexible start times, or shortened work weeks – is highly effective, especially in workforces that include a lot of caregivers or working parents. Finally, giving employees more control over how work is performed boosts in-role satisfaction, and can often be effectively achieved with managerial re-training or even subtracting a layer of unnecessary oversight.

This last element – giving workers more flexibility over how work is performed – flows directly into another majorly prized aspect of modern work, autonomy. Workers have always disliked micro-management, and modern layers of remote computer monitoring and daily “status check” meeting only exacerbate the problem. Shifting management structures to be more focused on the outcomes of work assignments rather than presence, hours spent, or activities completed allows for better alignment between organizational goals and worker preferences, with the added bonus of dramatic improvements to retention rates in the typical firm. Encourage full personalities at the organization Along with more flexibility and autonomy, employees are increasingly looking for opportunities where they can be themselves and bring their full selves into the workplace. The recent pandemic lockdowns highlighted for many diverse employees the true burden they had been under with code switching, personal styling, and feeling the need to hide or downplay elements of their lifestyle, culture, religion, or politics. Many are profoundly disinterested in picking that burden back up again. As a result, these workers are actively looking for opportunities where they can be accepted and valued exactly as they are. For many firms, this is prompting uncomfortable conversations.

Some are relatively small points, like a company adapting its facial hair policy after the major of the staff returns to the office with full “pandemic” beards. Others are more profound, such as an organization determining whether or not to fund travel for abortions for employees who find themselves in states that strictly limit the practice. Regardless of the level, these conversations are important for retention because employees are looking to stay with organizations that share their values and aren’t afraid to live those values along with them.

Thus, firms will find it to be to their long-term advantage on the retention front to be able to clearly express who they are, what they value, and how those values guide the organization’s behavior. It won’t be enough to simply place this on a web page, either. Workers are looking for organizations that “walk the talk” and will be fiercely loyal to firms who they view as authentic champions of key shared value points.

Concluding thoughts

Retention and turnover are major modern challenges. However, firms should look beyond simple salary increases to try and stem the tide of talent heading out the door. Workers value money, but many have other values that are more important to them right now. Modern retention hinges on flexibility, autonomy, and shared values. Workers want more say about their daily on-the-job experiences, welcoming things like remote work options and outcome-based scheduling. Further, workers want to be able to spend their days at organizations that enthusiastically share their values. Companies willing to invest more in the employee experience and in creating common values will be able to fight back against modern talent shortages by retaining more of their current workforce.