Organizations are seeing this more frequently; an employee is hired, trained, and just when they are contributing solidly to the team, FLASH, they’re gone! The employee has moved on and once again there is an unfilled position.
The ability to successfully entice, acquire and retain talent has become a high stakes battle as organizations place new attention on retaining employees.
According to a recent article by IRF, as the shift in demographics continues to decrease the talent pool, this once plentiful resource is set to shrink by 40%. That means there will not be enough new talent entering the workforce to fill the open positions. Of the nearly 76 million Baby Boomers that will eventually need to be replaced by the younger generations (GenX), there will only be about 47 million Gen X’ers in the funnel. There will not be enough workers in the next generation to fill the open positions in a stagnant economy or allow businesses to react quickly as the market gains traction in the future.
This deviation also means the employee has the competitive edge. When businesses cluster in the same local labor market, they face a tradeoff between the benefits of labor pooling (i.e., access to workers whose knowledge help reduce costs) and the costs of labor poaching (i.e., loss of some key workers to competition and the indirect effect of a higher wage bill to retain the others).
What can organizations do to lessen the blow from a hard hit economy and weakened talent pool? According to Ross Meyers, the Partnership Executive Director for Partners for a Competitive Workforces states, “It’s a grow-your-own strategy.” Organizations are turning to their own staff to cultivate the leaders of tomorrow and building a pool of talent. Known as “up skilling,” the practice builds on the “up from the mailroom” idea and the philosophy is that the best person for a job could be one a company already has. Providing employees with opportunities to grow their skills and move up within the organization may prevent them from looking elsewhere.
Additionally, to grow talent from within, the IRF sees a new emphasis on positive retention outcomes that are normally associated with employee recognition and incentives. In a 2010 study conducted by IRF, the results revealed, “Objective proof that a well-designed incentive travel program can help a company achieve its strategic goals and objectives. By creating an organizational culture built on rewards and recognition, corporate leaders motivate employees to be successful, thus ensuring the success of the corporation. From the design of the earning criteria to the blueprint of the travel program to the metrics used to measure corporate performance, this report provides a template that other organizations can implement to drive desired employee behaviors that will contribute to overall profitability.“
As the high stakes battle to retain top talent continues, organizations need to move away from the business-as-usual mentality. Developing a culture where great work is acknowledged by incentives or recognition and skills are strengthened through education might just be the winning hand organizations need.