Is It All About the Money?

You’ve seen the headlines. They’re like a broken record. The great resignation shows no sign of slowing. How to keep employees amidst the great reshuffle. Become a leader in the retention revolution! And if the turnover frenzy news feeds weren’t keeping you informed, LinkedIn will surely keep you updated that pretty much all of your contacts have started a new position.

The million-dollar question for the better part of 24 (plus!) months has been: how do employers retain current employees and attract new talent? The trending solution has been centered on wage increases and bonuses, and rightly so. Not only have employers been challenged with a tight labor market, but they are competing with employees’ elevated pay expectations with an added complexity of rising inflation rates. The U.S. Department of Labor reported on July 13^th the annual U.S. inflation rate hit 9.1 percent in June, the highest in 41 years.

But at the end of the day, is it all about the money after all? Perhaps that is where employers have fallen short.

Higher paying opportunities have been a driving force behind the “great resignation;” however, statistics show it has not been the sole motivator. The pandemic triggered employees to reevaluate their priorities, as such, placing a higher value on fulfillment in the workplace, opportunities for professional development and improved work-life balance. According to Prudential’s Pulse of the American Worker Survey: A Third Year Begins — Life and Work in the Pandemic Era, of the 22% of workers who switched jobs during the pandemic, one-third said they took a pay cut in exchange for a job that offered better work/life balance.

The aforementioned factors related to employee satisfaction and wellness have often gone unnoticed by employers, which in turn silently fueled employee dissatisfaction and turnover. PwC’s Global Workforce Hopes and Fears Survey stated the need for employers to be more cognizant of the employee experience they offer and placed onus on leadership to recognize opportunities for their team members. By taking a total rewards approach of both direct (salary, bonuses) and indirect compensation (flexibility, perks, culture) employers double the “take home” for employees in a financial and non-financial manner, thus enhancing employee fulfillment.

Various indirect compensation methods can be implemented to increase employee retention, boost engagement, and attract new talent. For example, an employer can support the work/life balance by eliminating the rigidity of a start/end time and create a window of when an employee starts/ends their day. This flexibility allows employees to make a quick trip to the vet, drop off a child at camp, or attend an early morning exercise class. Similarly, personal fulfillment at work is key to retaining the best employees. A survey conducted by Pew Research Center reflected 63% of respondents quit their job because there were no opportunities for advancement.  Offering career development opportunities such as continuing education or paid recertification enriches the employee experience, helps hone professional skills, and creates space for an engaged, key contributor to climb the organization’s ladder.

To be a contender in today’s labor market, employers should think outside the box about how to approach and implement a total rewards system to enhance employee engagement, retention, and satisfaction. Additionally, ensuring fair and competitive wages are equally important and Cascade’s compensation team is ready to partner with you on those needs!