The Great Resignation! The Big Quit! Recent headlines have been shouting about massive resignations by employees in 2021. It isn’t just hype: according to the U.S. jobs report, over 20 million workers quit their jobs in the latter half of 2021. For companies that want to retain talent, it is a very concerning time. 

The pandemic has changed the world in ways we are only starting to comprehend. It has affected all facets of our lives, including how people think about work. Many workers are re-examining their priorities are around their careers – whether it is income, flexibility, benefits, environment, location (or flexibility on location), colleagues, management and overall job satisfaction. Workers at all levels have been forced to reevaluate what is most important to them. 

While the highest level of resignation is in the retail and hospitality sectors, the fact remains that there are millions more job openings than there are jobs. As of November of 2021, there were 10.6 million job openings and only 6.9 million people unemployed. It is currently an employee’s market. Employers need to take note and adjust their practices. 

What can companies do to retain top talent? What are the best moves for firms to avoid the expense and stress of having to repeatedly hire for the same position? At Lancor, we are advising the private equity firms we work with to think about the following factors in order to retain their executive employees: 

Create a Long Term Career Plan For Your Most Valued Employees

At Lancor, we work with a lot of CTO and CIO placements. These candidates are telling us that although engineering talent needs seem to be at an all-time high, their direct and indirect reports really want to work for firms that will support their long-term career plans. They often value that support, more than higher salaries alone.  In addition, when they are looking to hire new colleagues to their teams, these new hires are almost always going with the firm that is focused on the individual’s career progression and one that provides a clear development path. This focus is very cheap (compared to losing top talent and then going through a process to hire top talent again at an even higher rate). It is certainly better than simply coughing up more capital and therefore lowering profitability. Instituting a clear path towards progress keeps the best talent, and allows firms to augment their talent with the best from outside the firm.

Mentor Your Employees

One way to make employees feel valued is to pair them with mentors. Having a well-organized mentorship program is a draw for employees. It shows a personalized commitment to an employee’s growth and trajectory. A mentor can provide guidance, be a sounding board, and help an employee navigate a variety of workplace situations. It can also provide real insight into their next steps and career paths, ensuring that employees feel certain about the next steps of moving up in the company.  Many mentors also gain personal and professional satisfaction, plus the relationships can be an added level of glue to retain top talent (mentee and mentor).

Don’t Just Pay More

More pay is the easiest thing to do, and what most employers think can solve job departures. The harder thing is to fix the problem that is causing employees to leave. If a company doesn’t have an improvement plan and the only solution is to pay more, they will not stem the departure tide. The best managers are focusing on addressing what their individual employees are looking for. That means addressing remote work needs/requests, job flexibility, benefits and company culture among other things. Each employee has a different set of needs so find out what is important to them. The best managers are minimizing their attrition and maximizing their ability to recruit by supporting their employees on a case-by-case basis.  Yes, this takes effort but the results are worth it.

Invest in Your Employees Future

Many companies are looking closely at employee benefits including 401K accounts. Facebook is just one company that is increasing their contributions in 2022 (and they are an example of a firm with a less than perfect press record that still needs to keep top talent). Another way to invest in your employees is to pay for their continuing education. It can be more beneficial than direct cash to the employee since the money spent on their education comes right from the company vs receiving a benefit after taxes.  Many firms also provide a loan that is “paid back” after some time period that also acts as a retention tool.

Make a Decision Around Remote Work

Many employees and their managers have developed strong opinions around working in an office vs. remotely. Some people crave the camaraderie of the workplace, while others prefer working from home. With almost two years out of the office, many workers have gotten accustomed to working remotely and the transition back might be a difficult one. Firms should try and weigh personal preference with productivity (perhaps your employees are more productive out of the office) and try to take an understanding approach that focuses on productivity.  As a result, managers need to learn how to manage differently… 

Ultimately, companies should be focused on supporting their employees, invested in their long-term success. By thinking differently and understanding that throwing money at the problem isn’t the solution, employers will have better and longer relationships with their colleagues.