What Companies can do to Retain Talent in 2023
Article by Mansi Tyagi (HR Head, Trycon Technologies)
New Delhi: According to a 2022 survey conducted by Aon plc, India’s attrition rate was 20.3% in 2022. Regardless of the reason behind these high resignations, the most affected were HR Managers. This meant the stress of re-hiring and a substantial increase in the cost of both recruitment and training.
Moonlighting and ‘side hustles‘ are other major by-products of COVID-19. Employees now can choose their work environment and simultaneously increase their income. This change in employee behaviour has brought a lot of uncertainty and mismanagement in organizations. HR Managers need to figure out how to deal with this.
In all, retaining an employee has never been more challenging.
However, remember that the team that hires employees also can retain them. So, as HR Managers, we need to tweak our approach to the problem, and the solution will present itself.
It’s almost 2023. HR Managers who believe that an employee’s motivation is still based on compensation and benefits should think again. To understand employees’ motivations, it is first necessary to see them as fellow human beings. Simply what works for you as a human will broadly work for others too.
The last couple of years has proved that working from the office and productivity are hardly interlinked. Work can now be only two steps away if needed. People are now more ‘at home’ and more productive in their chosen work environment.
So, if you’re planning to force team members to come to the office, first expect frustration and then, ultimately, resignations.
Instead, HR Managers can develop a process to ensure higher productivity of their people. They can do this by giving people the right to choose the work environment they thrive in-work-from-home, work-from-office, or both. Any other measure and you will lose people in the short term, especially smaller companies with little or no brand bargaining power.
Demand & Supply
The booming tech industry is not a new phenomenon. The number of jobs in tech and compensation has steadily increased over the years.
But what’s new is the sudden rise in money in the industry. With the surge in ‘exciting‘ start-ups and the funding they are getting, it is a job seeker’s market. Even more so if you’re good at what you do. As an HR Manager, you probably needed help hiring people in the last year or so. You know it.
If you wish to keep up, you’ll need to convince upper management that salary/appraisal corrections will need to be made. ‘Industry-standard hike‘ data, found on HR websites and reports, is no longer valid. We must go back to the good old days of on-the-ground research and have in-person discussions.
We need to have more ‘human discussions. In addition to higher compensation, think about what more you can offer positions of responsibility, better soft skills, personality growth, and a better lifestyle. Help them become better versions of themselves.
People will want to stay and learn if you can match their idea of growth.
How often have you heard the phrase “this generation is smarter than we could ever be“? That too by people to describe the generation next to theirs?
Gen Z has been much more prepared to take up responsibilities than any other generation. They know their job and their capability to do it as well.
You can no longer expect them to be submissive. You cannot treat them as individuals who can be told what to do at every step.
If you want to retain this generation, show them kindness and respect. Focus on their strengths, and accept their imperfections and diversity.
Job Security v/s Collaborative Ownership
It’s also important to understand that most Gen Z has grown up with all the essential requirements that an individual needs. That is food and nutrition, a roof above their head, and decent education. Their parents-the generation driven by job security-have taken care of this.
So now, people in this generation want more of what life offers. They need both self-esteem and self-actualization.
Work has to transcend from ‘telling them what to do to ‘a collaborative effort‘. They need to know why they’re doing what they’re doing and what impact it will have on the company’s growth. They need to feel invested and be ‘part owner‘ of the value creation.
Here is what HR Managers can do. Train managers to throw out micro-management and give more creative freedom to people. Trust them and allow them to prove themselves.
Cost of Recruitment
Imagine an existing employee coming to you with a higher offer from a different company. You now have two options: either reject the hike request or match the offer. What will you choose? If you choose the latter, you can relax. But if you choose to ignore the request, get ready to list the upcoming expenses.
When an employee quits, first is the full-and-final settlement. Next, the cost of recruitment tools and platforms. Not to mention the time and energy spent by the HR team and hiring managers during the interview process. Let’s say you do manage to find a candidate in this challenging market. Now you have to wait. The candidate may or may not join. Next is the hike the candidate is expecting for switching companies. Then comes the cost of training, including the time and energy spent by the training managers. Now compare the sum of all of this with the requested appraisal cost. Simple math?
More than tactics, it’s the change in mindset that will help HR Managers retain people. This also needs to happen from top to bottom from an organization’s point of view. But it is the job of HR Managers to influence upper management and show the right direction.
So, in 2023, start seeing your employees as “humans” instead of “resources“. Make them a part of your team. Take care of them as you would of any of your loved ones. You will be surprised to see how beautifully they showcase their loyalties.