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Hang on to Employees During the Recovery

by Louise Fletcher
Monster Contributing Writer

A national survey conducted by the Conference Board in September 2003 found that more than half of all US employees were unhappy at work, a statistic that the Conference Board attributed to the increasing demands placed on American workers.

Yet despite these alarming numbers, most employees have remained in their jobs because of the tight job market. They feel lucky just to have a job, but that feeling won't last forever. Once the economy starts adding jobs consistently, many of these unhappy employees may start to look for new opportunities. HR professionals must be proactive to hold on to key employees.

Retention

Ernst and Young calculated the cost of replacing an experienced employee at up to 150 percent of the individual's annual salary, so it makes sense to focus on keeping the people you have. Start management-level discussions about retention strategies now and be creative in your thinking. For example, if company profits are improving, you may want to consider paying last year's bonus that was missed because of the economy, but structure it as a retention bonus -- half to be paid now and half in 12 months.

Share good business news with your employees and find small ways to reward them, so they understand that lean times are over. If you're planning a pay raise this year, say so. If you expect to pay bonuses, let people know. And, above all, communicate clearly and frequently about company direction, plans and financial results.

Identify Problem Areas

No matter what you do, there's a good chance you'll experience employee turnover as the job market heats up again, especially in the departments that have been particularly hard hit by the economic downturn. Perhaps your sales team has been demoralized by a failure to meet its targets, or your IT budget has been cut so much that employees have to work impossibly long hours to keep old systems working.

You can assess your organizational problems by conducting a full employee satisfaction survey and breaking out the results by department or division. If a full survey is not possible, have managers and supervisors meet informally with employees to discuss their concerns. If you create an environment where people can talk openly, you may be able to predict which groups are most at risk of losing manpower in the near future.

Restart Recruitment Efforts

Once you know where your turnover is most likely to take place, you can begin to take steps to address the impending situation. Don't wait until people resign to build a candidate pool.

If you cut back on recruitment efforts and expenditure during the downturn, now is the time to get things moving again. You should aim to build a candidate pool for all key positions within your company so you can quickly arrange interviews when someone resigns. Start running campaigns for potential vacancies, but be honest in your recruitment efforts -- make sure applicants know that there are no current vacancies, but that you expect to start hiring again soon. Now is also a good time to reconnect with your network – many of your contacts will know people who are looking for work. Finally, be sure to renew relationships with external recruiters. Let them know you are on the lookout for good talent and ask them to send candidates your way.

The economic slowdown and subsequent jobless recovery brought great changes to the workplace, and these changes have led to an unprecedented level of employee dissatisfaction. HR professionals must address these issues proactively, working with senior executives on creative retention strategies while also building a significant talent pool so vacancies are filled quickly and effectively.