The U.S. labor market is nearly back to full employment–more than 1 million jobs have been added since the start of 2017, the unemployment rate was at 4.4 percent as of May, and job switching is at an all-time high with about 27 percent of U.S. workers changing jobs on an annual basis. As a result, employers are nervous about how to find and keep top talent, and they should be.
"Training and development programs are also an important component to successful employee engagement"
In a recent study, the ADP Research Institute (ADPRI) found that employees now have leverage, and they know it. 63 percent of an employer’s workforce is open to leaving for another job and 46 percent of employees would consider a job that matched their current salary or paid less. Employees also say that just a 13 percent raise is all they would need to prompt a job change. However, employers underestimate how many of their workers (49 percent) are open to new opportunities, creating an increased risk for talent drain if employers do not focus on employee engagement.
This highlights a growing disconnect between both employers and employees. Employees tend to concentrate on their work environment, look for meaning in their job, and want immediate advancement opportunities (the “me” mindset). Whereas, employers tend to focus on bigger picture areas like financial performance, reputation, and long-term career pathing (the “we” mindset). As the U.S. labor market improves, the “me” vs. “we” disconnect becomes most apparent in the area of employee retention.
While pay and work hours certainly play an important role in retaining employees, meeting employee expectations is also critical. Employees say they are more likely to stay with a company if their experiences in-role align with the expectations agreed to when hired–and if they understand how their role helps to achieve business goals. But when a position shifts away from that understanding, employees are already thinking of leaving–in fact, 47 percent of employees have walked away from a job that did not meet their expectations.
Training and development programs are also an important component to successful employee engagement. Currently, just one-third of U.S. employees give their companies high marks on career performance, learning management, and succession planning. This provides an opportunity for employers to improve these programs and by gathering feedback from employees to understand what they want to learn.
With competition for top talent a priority, employers who want to successfully retain and engage their employees need to focus on understanding what is most important to them and making efforts to address those needs. While compensation and benefits are still important factors, a healthy work environment, meaningful work, and opportunities to grow and advance are also critical.