Employees are job-hopping to a degree not seen since before the 2008 recession. Millennials are especially prone to switching jobs: In the first quarter of last year, The Wall Street Journal reports, twice as many workers under 35 changed jobs as those aged 35 to 54. The industries most affected are those already suffering from major labor shortages (including healthcare, manufacturing and construction) and traditionally low-paying industries such as food service and retail.
The plethora of available jobs signals a booming economy, which is good news — but for employers, there’s a downside. As a small business owner on a budget, how can you keep your valued employees from jumping ship without breaking the bank?
Tips for Retaining Employees
Here are six tips to help you retain employees.
1. Give Them a Raise
If you haven’t already increased your employees’ wages (and you can afford it), now is the time to do so. This will show that you value the employees who stay with your company.
2. Offer Financial Incentives
If you don’t have the cash flow to increase salaries permanently, there are still ways to financially reward your team. For example, you could give employees bonuses based on meeting certain sales goals, staying under budget, or reducing expenses for the department. You can give either individual bonuses or departmental bonuses. You could also set up a profit-sharing plan. If the business does well, your employees benefit financially; if sales stay the same, so does their compensation.
3. Add Employee Benefits
Health insurance is by far the most desired employee benefit, so if you’re not already offering this, investigate the cost of doing so. It’s OK (in fact, expected) to ask employees to share some of the premium costs; you can have this taken out of their paychecks pretax. If you’ve already got the basic health insurance in place, look into adding extra such as dental and vision coverage. Also popular are retirement plans, such as 401(k)s, which are available for even the smallest businesses.
4. Be More Accommodating
To keep valued employees happy, you may need to make some accommodations you wouldn’t do in a tougher job market. Things like letting employees leave early for doctors’ appointments or a child’s school play without docking wages can make a big difference in employee loyalty. But you may need to go farther: Allowing employees to arrange their schedules so they can attend a favorite exercise class or go home at lunch to walk the dog are not unheard of in these times.
5. Throw in Some Perks
Little extras like bringing in breakfast or lunch once a week or providing donuts and bagels on Fridays can go a long way to showing employees that they’re appreciated. Think of other ways to reward employees, like closing down the office early on summer Friday afternoons or bringing in someone to give deskside neck rubs after a busy week. Being able to work remotely or have flexible hours are two very popular benefits. In fact, 34% of employees in a recent study by Employee Benefits News say they would change jobs to get a flexible work schedule.
6. Reduce Stress
In the aftermath of the Great Recession, most employers asked their employees to do the job of two or even three people. While they may have become accustomed to this type of stress, that doesn’t mean they like it. Assess your employees’ workloads and, if necessary, find ways to redistribute the work, outsource it, or even hire a new person to handle some of the tasks. Employees who are less stressed out are less likely to look for greener pastures.
Above all, pay attention to your employees and keep the lines of communication open. This will not only make them feel more appreciated, but also enable you to spot signs of dissatisfaction before a valued employee gives their notice.
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