As the COVID-19 pandemic wanes with more people becoming fully vaccinated, its debilitation of the American economic activity is already fading away. One sign of this economic reopening is an increase in job-seeking – multiple surveys all show a broad pent-up desire to find new employment.
The pandemic spurred this desire to leave in many ways. First, a Pew Research poll last year showed a third of employees reported a compensation reduction during the pandemic – likely that percentage is higher today. An SHRM study in April 2021 indicated 82% of employees thought the pandemic affected their retirement plans. The bottom line of all these trends is that multiple surveys show that half of the American workforce is seeking new employment right now.
Consequently, companies emerging from this economic slowdown now face the prospect of losing key employees who were being counted on to be major players in the recovery. Clearly, a renewed focus on retaining employee retention must be a crucial short-term strategy to maintain a competitive advantage in 2021.
Grant Thornton’s recent webcast, “Strengthening the new deal with your workforce” explores this issue, offering ways to create an employee retention strategy to reduce the impacts of flight risk on recovery and growth. Below are some highlights of what is more fully developed in the free webcast.
Evaluating how to attract and retain talent to a workplace must begin with an understanding of emerging talent risks and how the shift in time and resource allocations impacts the relationship that an organization has with its workforce. “If an organization failed to expand the breadth and depth of internal capabilities needed to manage its human capital risk, the overall effectiveness of existing workforce programs and engagement with the workforce was diminished” said Bob Lemke, director of human resources and compensation consulting at Grant Thornton.
Lemke emphasized the need to review existing workforce programs and human capital governance processes to apply the lessons learned in the early stages of the COVID-19 response and the patterns that may have emerged from the later phases. “These will help organize retention strategies around a new foundation” Lemke said.
Tim Glowa, principal of Human Capital Services for Grant Thornton, points out a couple of important measurements that companies must emphasize so as to better “measure up” to their competitors.
- Pay equity: “Make sure that our pay is fair across all different groups,” Glowa said. Conducting regular reviews of broad-based employee compensation arrangements improves alignment to longer-term objectives and identifies potential human capital risks, especially legacy practices that fall short of elevated expectations around transparency when sharing information about human resources and workplace programs.
- Benefits packages: “If we’re essentially offering the same package as people that we’re competing against, why would any employee stay with us and not go somewhere else?” Glowa said. Too often, organizations aim to be in the middle of the pack with their peers when it comes to organizational benefits, and these were often frozen or reduced during the pandemic. Make benefits a differentiator.
- Analytics: Take the guesswork out of consideration by using data-based recommendations. Like marketers have recently done, human resources departments have opportunities to apply analytics and gather more predictive data to identify high-risk areas to forecast individual employees who might be at flight risk for leaving.
- Structured two-way communication: Set up and systematize was to listen to employees’ concerns and their ideas for solutions. This can easily be done by creating focus groups and instituting monthly surveys, through which a company can have frequently updated insights on issues of concern among its employees.
- Flexible workplace: The ability to work remotely, brought on by necessity during the pandemic, seems to be a change that many employees want to embrace permanently. Retaining hybrid work structures that ensure the flexibility to choose where to work should be a high priority for companies that can support online work.
An evaluation of your company’s ability to retain its employee talent and create an effective plan can lead to complex considerations which could be helped by outside advisers familiar with these issues. But its complexity shouldn’t be a deterrence. Companies thrive by hiring and retaining talented employees and doing so needs to be a top consideration for businesses poised to recover strongly in our post-pandemic economy.
Tax professional standards statement
This content supports Grant Thornton LLP’s marketing of professional services and is not written tax advice directed at the particular facts and circumstances of any person. If you are interested in the topics presented herein, we encourage you to contact us or an independent tax professional to discuss their potential application to your particular situation. Nothing herein shall be construed as imposing a limitation on any person from disclosing the tax treatment or tax structure of any matter addressed herein. To the extent this content may be considered to contain written tax advice, any written advice contained in, forwarded with or attached to this content is not intended by Grant Thornton LLP to be used, and cannot be used, by any person for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code.
The information contained herein is general in nature and is based on authorities that are subject to change. It is not, and should not be construed as, accounting, legal or tax advice provided by Grant Thornton LLP to the reader. This material may not be applicable to, or suitable for, the reader’s specific circumstances or needs and may require consideration of tax and nontax factors not described herein. Contact Grant Thornton LLP or other tax professionals prior to taking any action based upon this information. Changes in tax laws or other factors could affect, on a prospective or retroactive basis, the information contained herein; Grant Thornton LLP assumes no obligation to inform the reader of any such changes. All references to “Section,” “Sec.,” or “§” refer to the Internal Revenue Code of 1986, as amended.
More human capital bulletin
No Results Found. Please search again using different keywords and/or filters.