The biggest challenge I hear from my clients of all sizes in this year of economic growth and low unemployment is finding (and keeping) good workers. Unfortunately, that challenge looks to be more pressing for the foreseeable future.
That’s the takeaway from a new study of more than 22,000 employees in 40 countries from research firm Gartner. The study revealed that nearly half (47%) of employees do not have a “high intent” of staying in their jobs, an increase from 40% in the first quarter of 2018.
“We are continuing to witness a multi-year decline in employee discretionary effort both in the US and globally, as workers are simply not seeing rewards from their employers for going above and beyond,” Brian Kropp, group vice-president of Gartner’s HR practice said.
“Ultimately, employees are capitalizing on the realities of the tight labor market – workers don’t see benefits for offering additional effort nor are they worried about getting penalized for doing less. The surplus of jobs open in the market is bolstering employee confidence as workers believe they can easily find another position.”
Not only are more employees likely to leave their jobs, but a growing number of them are less motivated to do a good job. Gartner’s research showed that nearly 16.3% of US workers expressed “high levels” of discretionary effort, a decline of nearly 8% from the same period last year. Only 7.5% of global employees ranked among the highest categories of motivation and intent to stay in their jobs.
Why? It’s because good people are a hot commodity nowadays and they simply want to earn more.
“Given strong economic performance across many US industries in 2018, employees hold much higher expectations for greater increases in wages and bonuses going into 2019,” said Kropp. “As companies approach compensation planning for next year, executives will need to factor in these employee expectations to remain competitive and to attract and retain talent, otherwise they risk losing their best workers to competitors.”
But it’s not all about cash. Today’s workers – and one-third of them are 21- to 36-year-old millennials, the largest generation in the workforce according to studies such as this one from Pew Research – want more flexibility and independence. They want decent healthcare, additional paid time off to spend with their families and help with daycare. They want to work for companies that are socially conscious and technology savvy. All of these factors are important for keeping them happy and motivated.
But these things have a cost, which is why some companies like Amazon and Walmart are making investments in technology to help control their overheads. But technology will never replace the value of a good worker and most of this stuff is still a ways off in the future for a typical small business. So in the meantime, how do you make sure your company is getting and keeping the best workers possible?
The answer is simple and harsh: pay more.
Unfortunately, I have too many clients – particularly small businesses – who resist the law of supply and demand and instead wind up losing good employees to competitors and larger organizations because they’re too stingy or not willing to change.
Of course this is easier said than done. But sacrificing a few dollars in profits or risking the wrath of some customers with a price increase may be worth losing the one asset that your company depends on for growth and survival: your people.
