Low unemployment is generally seen as a good thing, economically. But it can spell trouble for companies who need to hire and retain workers. While the hiring drawbacks are usually quite clear, as low unemployment means there is a smaller pool of available job seekers to choose from, retention-related issues can be somewhat sneaky.
Often, when competition for top talent is fierce, businesses must try to lure professionals away from another company to fill their vacancies. This approach typically leads to the creation of strong compensation packages with higher salaries and a range of perks that competitors may not yet be offering.
Luckily, the techniques used to convince passive job seekers to abandon their current positions can also be used to protect your company from this form of turnover. Here’s what you need to know.
When companies are fighting for top talent, compensation is often their primary weapon in the battle. Many businesses will increase salary offerings, make benefits packages more comprehensive, and include a range of perks designed to lure in applicants. To keep workers from turning to another business based solely on compensation, you need to make sure your offerings meet industry standards.
You can also use compensation to help promote longevity. Time-based incentives, such as becoming vested in the retirement plan, can encourage workers to stay on longer, at least until they can access the benefit.
Additionally, not all benefits have to come with a distinct price tag. Options like flexible work schedules and the ability to work from home may be particularly attractive to certain employees, and may not be as impactful to the budget as offering raises or similar benefits.
Most workers haven’t reached their peak when it comes to their careers, and employers who support their desire to move forward along the path are highly desirable. Investing in career development plans, continuing education, tuition reimbursement, and skills training can improve retention while also attracting job seekers to your vacancies. It also serves as a method for filling any skill gaps teams may have with internal staff, providing a benefit to the business as well.
When low unemployment shrinks the candidate pool, it may be tempting to hire the first professional who has the ideal mix of hard skills, even if they might not fit into the company’s culture. But choosing a candidate that may struggle to fit in at the workplace is almost guaranteed to lead to an early exit.
Employees who aren’t satisfied with their employer are going to seek out new opportunities, especially in a job market where they are relatively plentiful. This means you could hire a new employee only to lose them quickly because it wasn’t a great fit in the first place.
If you are looking for a person to join your team, the professionals at MindFinders can connect you with top talent who will thrive in your company’s culture. Contact us to see how our customizable approach to recruitment and hiring can help you meet your retention goals even during low unemployment.
Written by Tim Booker, President and CEO of MindFinders, with over 20 years of industry experience.