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What matters in today's labor market

The labor market is challenging. Compensation, flexibility, and purpose can help you recruit and retain the talent you need.

Executives are facing unprecedented challenges in the labor and talent arena. With talent attraction and retention at the top of the list, we dive into three hot topics for employees and potential recruits and ways you can begin addressing them.

Competitive compensation is a must

Current and prospective employees want to know: Is compensation fair, is it equitable, is it competitive in the marketplace?

The market has shifted and is driving wage increases in a way that we have not seen in 20-30 years. We are hearing more and more from employers that they are losing people to similar positions in other companies for as little or as much as $5 more per hour. Many macro trends are impacting this, including changing demographics and a skills mismatch from changing work, but the main point is that these are big shifts for organizations, and they will ultimately require different strategies going forward.

How to address: Assess what you are doing in key areas for compensation and benefits and whether you can build transparency into your compensation structure. This can include considering minimum wage rates, base pay increases, off-cycle adjustments, retention bonuses, time or skill-based increases, interview pay, hiring bonuses, referral bonuses and relocation packages.

Employees and prospective employees want flexibility

Employees and prospective employees want flexibility with time off needs, how work is done, and when work is done. What this may really mean is that employees want autonomy.

COVID changed people’s thoughts about work and how work can be done, but there is often a disconnect between what employers think and what employees think. We hear from recruiters that most applicants won’t consider a position if flexibility isn’t built in. Most employees don’t want to work exclusively at home, but they want to know there is flexibility.

How to address: Consider what aspects of the job can be done remotely. If so, you may also want to begin considering how other types of benefits may appeal to remote workers, such as work-from-home setups and technology perks.

Your organization's “why” matters

Employees and prospective employees are leaning more into how they fit into an organization’s culture and purpose or “why” and looking for a sense of connectedness and purpose. This is a critical idea in the context of the tight labor market.

When recruiting and retaining employees, knowing and effectively communicating your “why” is more important than your “what”. It may be one of your most powerful weapons in the talent recruitment and engagement war.

How to address: If you haven’t done so recently, or ever, make time to discuss and document the “why” of your organization. Start with the following questions:

  • Who are we?
  • What matters to us?
  • How do we invest in our employees and the customers we serve?
  • What is our approach to inclusion and belonging?

In summary

The war on talent will likely intensify in the years ahead. Do not continue relying on what you have always done. Take some time now to begin evaluating options within these three key areas. If your company combines meaningful purpose with competitive pay and flexibility, you will have a much better chance of recruiting and retaining great talent.

If you have questions about your current recruitment and retention situation, contact Carrie Cox using the information below.

Carrie Cox

Senior Consultant
HR & Org. Development Services

Carrie has experience in a variety of human resource functions, including labor laws, compensation structures, employee classification, benefits administration, performance management and human resource best practices. She has served clients in a number of industries, including manufacturing, construction, banking and not-for-profits. Carrie is a member of the national and local chapters of the Society of Human Resource Professionals (SHRM) and serves on the Wichita chapter board of directors.

She is a certified practitioner for the Myers-Briggs Type Indicator® and the Hay Group’s Emotional and Social Competency Inventory. Her additional certifications include Professional in Human Resources (PHR) from the Human Resource Certification Institute and SHRM-CP designated by the SHRM.

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