24 Apr Hotter Economy Can Spark Retention Challenges
Although a recent report on U.S. job growth has left many observers disappointed, other economic signs are prompting employers to re-evaluate their benefits and retention strategies to avoid a potential talent exodus.
The Department of Labor reported that the nation added 120,000 jobs in March, down from the previous three months that saw 200,000 or more new jobs. Still, the stock market is up for the year, and U.S. employees appear to be more secure in their jobs. The Randstad employee confidence index — which measures how confident workers feel about their job security and the economy — rose in March to the highest level since October 2007, according to Workforce magazine.
An improving economy, however, has a dark side: Talented but unhappy employees will seek better opportunities elsewhere, experts say.
“There is a storm brewing,” said Lynne Sarikas, executive director of the MBA Career Center at Northeastern University, in a recent Human Resource Executive online report. “Many people will be looking to make a change once they perceive improvement and stability in the job market. This will have a significant impact on their employers.”
More movement in the job market can spur hotter competition among employers for good talent. In addition to competitive wages, robust employee benefits can help employers keep their best workers happy and productive — and employers are taking notice. A recent study by MetLife found that 90 percent of companies say they don’t plan to cut employee benefits in the near future, according to a report by CCH. A large majority (91 percent) of those polled expressed confidence that benefits work as retention tools.
While health, dental, vision and other stalwarts in the retention toolbox remain central to many companies’ overall offerings, employers may want to consider additional choices to sweeten the benefits pot.
For instance, companies that want to pull in younger workers may want to investigate defined benefit (DB) retirement plans, according to new research. A recent study by Towers Watson, reported in PLANSPONSOR, noted that 63 percent of workers younger than 40 said in 2011 that they chose their current employer because it offered a DB plan, compared with only 28 percent in 2009.
Education benefits are paying off for some companies, as well. United Parcel Service is sponsoring a program that pays up to $3,000 per year in tuition reimbursement for part-time employees. Executives say the program has spawned talented leaders who have stuck with the company.
“Enhancing the skills and knowledge base for our employees is a fundamental element of our success, and correlates directly with our policy to promote from within,” Susan Rosenberg, UPS public relations manager, told the Atlanta Journal-Constitution.