The importance of employee happiness for retention: Why it matters and how to achieve it
E: In the current jobs market, businesses are finding it hard to source people with the right skills to fill vacancies, which means it’s more important than ever to keep existing employees happy.
In the current jobs climate, where many organisations are plagued with a shortage of skilled workers, it is important to take care of existing employees’ happiness and wellbeing – as content staff members are less likely to look for pastures new compared to their dejected counterparts.
According to the latest Resource and Talent Planning report from Hays and the Chartered Institute of Personnel Development (CIPD), retaining talent has become increasingly challenging for organisations in the UK. Of the 462 respondents polled, just one-fifth (22 per cent) reported that they had no retention difficulties in 2013, compared to 34 per cent in 2012.
The results reveal that managers and specialists are the most difficult type of employee to keep, particularly in the public sector, as 60 per cent of participants here reported difficulties in retaining workers versus 40 per cent in 2012, indicating that the situation is worsening rather than improving.
Despite the challenging environment for organisations, one in five admitted that they hadn’t implemented any specific initiatives to rectify the issue. CIPD and Hays believe that the focus on retention dropped away in the aftermath of the global financial crisis in 2008 and hasn’t been climbing back up at a quick enough pace.
The skills shortage means that the situation is likely to become more challenging for employers when it comes to retaining staff, as some employees will realise that they are in high demand, which could encourage them to jump ship and join a new firm.
This means it is now more important than ever to take charge of keeping staff happy and take care of their wellbeing.
Organisations can do this in many ways and it doesn’t always involve grand gestures or financial rewards. Often, a few kind words of encouragement or positive feedback on a project can be enough to keep an employee content and motivated.
Here are some of the things an employer can do to keep its workforce feeling happy and fulfilled.
The standard 9-to-5 working structure may not work for everyone for a variety of reasons, such as childcare and caring for a family member. Being flexible and offering employees the opportunity to set their own pattern to some degree allows them to feel like they are more in control of their work-life balance.
Research from Lloyds Commercial Banking reveals that more than two-thirds of small to medium-sized enterprises (SMEs) in the UK offer flexible working, such as adjusted hours and working from home. David Oldfield, managing director of SME and mid-markets banking at Lloyds Banking Group, believes flexible working is crucial in creating a happy and dynamic workforce, as it was found to boost morale, help employees better meet customer demand and improve productivity.
One of the simplest and most effective ways of keeping staff happy is to reward hard work and praise them when they deserve it. Employee benefit schemes are a great way to do this, such as a salary sacrifice programme that allows staff to get something they want at a cheaper price than they would find elsewhere. Those involving technology prove to be particularly successful, as employees can get their hands on the latest gadgets and devices at more appealing prices.
Employee reward schemes that involve technology are a win for both the employer and worker, as the former gets happy staff and the latter gets to access the latest gadgets at a much cheaper price than they would find on the high street. The devices can also be utilised for personal use, meaning the reward doesn’t necessarily have to be connected to work.
According to Motivation Matters, cash incentives can cost up to six times as much as their non-cash counterparts and not be as effective. The firm also believes that cash rewards lose their value over time, as once the money is spent, it’s gone for good.
While it’s incredibly important for an organisation to build brand loyalty among its customers, it’s also vital that it nurtures the same kind of environment internally. This can only be done if employees can interact with management – if this isn’t done, a business risks becoming faceless, leading workers to remove themselves from the corporate identity. Emails and conference calls are a convenient method of communication with employees, but an effort must be made to schedule face-to-face time.
Ramesh Tainwala, chief executive officer of luggage maker Samonite International SA, told the Wall Street Journal that getting together with employees is important and other forms of communication, including video conferencing, can’t make up for it. He said: “A conference call cannot substitute for face-to-face interactions. When we meet in person, we almost hear each other’s thoughts.”
Meeting staff in person is the perfect time to pass on praise, discuss improvements that need to be made and open the floor for employees to air their grievances.
Every little helps
In a market that’s working against employers, it’s important that businesses do all they can to keep existing talent just where it is. Whether it’s done by changing the way the company works, by improving management or by offering additional benefits, it’s important that an organisation has a plan in place to stop the best employees from looking for greener pastures.