Consumers are feeling the burden of rising costs for everyday products. And with inflation at a 40-year high, companies are starting to see more and more requests for big pay increases. Raising every employee’s salary by 10% probably isn’t an option. So how can employers boost retention?
The simple reality is that people leaders must get creative to maintain worker satisfaction levels in the face of rejected pay bumps. While more money may be a great incentive, the Great Resignation (or what some are calling the Great Realization) has taught us that salary isn’t the only motivator. A strong corporate culture and engaging with staff to ensure there’s purpose and incentive to their work can be just as powerful for keeping employees happy.
With that in mind, here are three proven strategies for achieving cost-effective employee retention in the face of inflationary pressure.
Lean on flexibility and autonomy
COVID-19 showed that most teams can function at a high level regardless of where they work. Meanwhile, the Great Resignation showed that coming back to the office full time is a deal-breaker. In fact, 64% of the workforce would consider looking for a new job if required to return to the office full time.
The bottom line is that flexible work arrangements are now a top consideration for job candidates—one that’s almost on par with compensation and benefits. But flexibility around working location and hours is only the first step in creating and maintaining a positive employee experience. Autonomy also counts.
The “right” level of autonomy looks different for each employee. Some employees prefer more direct lines of contact with managers, more support with projects, or more structured work hours than others. Regular 1-on-1s with your direct reports are great opportunities to build rapport and understand working styles so you’re managing each employee as an individual.
Understanding employees’ unique working styles and personalities—and then adjusting management styles to accommodate their needs—strengthens interpersonal relationships, builds trust, and increases the productivity of your team. When deployed properly, giving employees their desired level of autonomy improves every aspect of the work experience. Greater autonomy is arguably your most effective tool for improving worker satisfaction in the face of financial pressures from rising inflation.
Remember, you’re either building trust or eroding it. There’s no in between.
Show employees you’re really listening (and taking action)
People consistently highlight engagement at work as a key consideration when deciding whether to stay at their current job or exit the business. When employees can offer candid opinions about their work environment and impact the direction of the company, they are more likely to engage with you as a leader and support the decision-making process. They also become stakeholders in defining and upholding your company’s culture.
Imparting ownership demonstrates that everyone’s voice truly matters. At my company, we’ve found that biweekly pulse surveys are valuable for surfacing employee insights. We analyze the results, pull key themes from the questions and comments, publicly share the data (while keeping names anonymous), and have leaders write responses.
Trends in employee satisfaction show that companies need to listen more frequently and go beyond measurements. The annual check-in won’t offer the insight needed to support your organization or allow you to be agile with your decisions. Furthermore, simply measuring engagement doesn’t provide the necessary feedback to understand employee perspectives or inform future decisions. The combination of frequent, diagnostic listening with measurement is key to supporting a better employee experience.
Removing barriers to communication and encouraging honest, comprehensive feedback on how decision-makers are performing fosters a level of trust, transparency, and engagement that keeps people invested in their roles. Moreover, when you prioritize consistent and open communication, your people become more receptive to explanations of company financials, metrics, or other factors that necessitate delaying requests for pay raises.
Know that recognition and incentives go a long way
A top-down effort to consistently call out good work (whether big or small wins) encourages a culture of recognition throughout the organization. The result is that your workers feel invested in the employee experience—and that your company is invested in their success.
Recognition is an ongoing effort and can take any number of forms. Scheduled time for verbal recognition and appreciation, social media posts on success stories, and monthly company-wide awards are all effective ways to shine a light on employees’ achievements.
You can also tie non-salary incentives to moments of recognition Additional paid vacation days, subsidized trips, or fun gifts that accompany recognition of great work reward employees for their achievements without impacting payroll.
Employees are motivated by more than money. Providing the right level of support, assigning purpose to their work, and creating opportunities for improved engagement are now significant factors that move the needle on employee satisfaction—even in an uncertain economy. When you make meaningful, systemized efforts to create an inclusive and nurturing space, your people will start to look beyond the bottom line.
Rob Catalano is the chief strategy officer at Kazoo + WorkTango.