Ever since the onslaught of the pandemic, workers across several industries have been quitting their jobs in record numbers in search of an improved work-life balance, better pay, and more inclusive and healthier company culture.
At the height of it all in 2021, more than 47 million workers quit their jobs, a disruption in America’s workforce that many have referred to as The Great Resignation. Although the severity of the pandemic has waned in recent months, quit rates are still outpacing hiring intakes, even as broader economic challenges continue.
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Earlier in the year, analysts estimated nonfarm payrolls for the month of January to come in at 187,000, only to be dumbfounded, as employers added more than 517,000 new jobs for the month. The national unemployment rate fell to 3.4%, the lowest in more than six decades.
Despite the positive intake of nonfarm payrolls in recent months, America and many other developed nations are currently experiencing a severe skilled labor shortage. According to the U.S. Bureau of Labor Statistics, approximately 8 million skilled-labor jobs were lost during the pandemic, with only half thereof being filled.
Industries including food, social assistance and health care, transportation, logistics, construction, and mechanical needs have seen widespread shortages, despite experiencing an uptick in employment levels in recent years.
Companies are experiencing severe talent shortages, and workers aren’t afraid to jump ship if they come across a more lucrative and attractive job offer these days. Keeping employees satisfied will cost employers more money, and more focus on employee demands to hold onto their current workforce.
Skilled labor shortages are widespread, and every industry will experience it differently, yet for smaller and more niche-like sectors, business owners will need to be more agile and innovative if they want to attract and retain the right talent.
Recruit The Right People With The Right Benefits
Ongoing worker shortages, especially in skilled positions have made recruitment a critical facet of finding the right people to work at your company or business.
Younger generations, those deemed Millennials and Generation Z, which currently make up a majority of the global workforce are seeking employer-based benefits that would help improve their well-being and their position within the organizations they work for.
In a Deloitte Global 2022 Gen Z and Millennial Survey, respondents cited work-life balance, learning opportunities, financial benefits, positive work culture, career opportunities, and flexible working schedules as the most important reasons for staying at their current organization.
This shows that employers and hiring managers will need to be more agile in the way they approach younger hires and the type of benefits they can offer potential employees. While it’s not possible to deliver all of these, and more at once, it’s important to consider how these benefits are woven into the fabric of the modern workforce, and offering employees attractive benefits will help retain them for longer.
Be Adaptable With Current Employees
Oftentimes companies lose valuable and highly skilled professionals due to their inability to utilize their skills effectively in the workplace. Employees that feel they have more to offer than what their current position allows them to do, are often more prone to quit than others.
Studies have shown that 79% of employees who end up leaving their jobs cite a lack of appreciation as one of the major reasons for leaving.
Employers will need to look at their current workforce, and recognize which of them have been underutilized, or simply placed in the wrong position. It’s essential to become more adaptable and realize that a job role doesn’t encompass two or three major factors.
Nowadays, employees want more opportunities to grow within their companies, learn new skills, improve their abilities, and be considered a valuable part of the company. Removing employees from mundane positions will help to keep them motivated, and also help them feel recognized in the workplace.
Improve Training Opportunities For Existing Employees
Aside from existing perks such as remote or hybrid work, or big paychecks, employees should be motivated with learning or education opportunities as well.
In a Gallup study, 87% of Millennials said that they believe learning and development in the workplace are important to them and their job. Additionally, in a different study, 76% of Gen Z workers said that learning is key to their success.
These two generations have become the biggest workforce globally, and companies will need to adapt to how employees are changing. Against this backdrop, and considering labor shortages, employers should consider how many learning and development opportunities they have offered employees in recent months and years, and if not, how can they address this issue.
Providing employees with the ability to learn new skills, improve their careers and further develop not only helps them grow as an employee but these theoretical aspects can be directly applied to the business as well. This not only helps employees grow their career opportunities, but it makes them more valuable in the workplace too.
Consider Using Freelance Or Contract Workers
Over the last few years, a growing number of workers have left the labor market to pursue a more freelance-based career. For some, this has given them more flexibility and time to do the things they enjoy, grow their careers, and develop new skills.
For employers on the other hand, and especially those experiencing labor shortages, utilizing contingent workers means they can fill open positions with skilled professionals.
Contingent workers are typically part-time or contract-based, and will most likely complete work assigned to them by a manager or the employer. This allows employers to fulfill their business-related duties, but also more time to evaluate what the company needs are and what will be required from new hires to fill open positions.
There are both risks and rewards that come along when working with contingent workers or freelancers, but given the fact that the talent pool is much larger, and employers can hire from anywhere in the world, it allows them to find the right person, for the right job, even if it’s outside of their direct vicinity.
Adjust Hiring Criteria
Job postings are often misleading, requiring several years of experience for an entry-level or junior position. Hiring criteria have become so stringent in recent years that it can feel almost impossible for even the most skilled worker to land a job at a high-paying company or small business these days.
In times when labor shortages are taking a toll on the business and other workers, it might be wise to consider adjusting hiring criteria to give more applicants a chance to showcase their skills.
Making changes to the hiring process will help employers see the type of talent that is currently out there and widens the talent pool. Allowing current employees to grow and develop their skills, and pairing new workers with skilled professionals will help make the process less stringent.
In highly skilled roles, experience, knowledge, charisma, and professionalism are crucial for the job. Yet, it’s not possible to see all of this in every employee out there, so it’s important to take a bit of time to consider what’s valuable to the organization and existing employees to see how hiring criteria can be adjusted according to these needs.
The Bottom Line
Retaining valuable employees is crucial, especially when labor shortages are on the rise, and employers are struggling to fill roles due to soaring quit rates. To mitigate these challenges, employers need to take a good look at their current workforce, how to incentivize them, and what they require to improve their development and career growth.
When there is a sense of care, respect, value, and meaning in the workplace, employees are often happier and become more loyal to their employers. While it’s not always easy to give employees exactly what they demand, it’s best to see how employers can meet employee demands halfway to minimize absenteeism and boost employee morale.
