By Brett Fellows, CFP
The “Great Resignation” is upon us. According to the U.S. Labor Department, a record-high 4.4 million people, or 3% of workers, quit their jobs in September. And this trend isn’t limited to the United States. Indeed, data from Microsoft Research found that roughly 41% of the global workforce is considering leaving their current employer this year.
As the Great Resignation presses on, retaining key employees is more important than ever—especially if you’re a business owner planning your retirement. If your exit strategy or succession plan depends on retaining key personnel, understanding some of the drivers behind the Great Resignation may help you minimize employee turnover.
Here are five considerations for retaining key employees amid the Great Resignation:
#1: Employees Want More Flexibility
Numerous studies show that most employees want to continue working remotely at least three days a week–even once it’s safe to return to the office. As a result, many employers are embracing a hybrid model, allowing their employees to work remotely part-time.
Be sure to talk to your key employees about their needs and work preferences. If they express a desire for more work-life balance, offering them increased flexibility may be an effective way to prevent unwanted departures.
#2: Employees Want More Meaning from their Jobs
According to a recent study by the IBM Institute for Business Value, more than a quarter of employees surveyed took new jobs to find more purposeful and meaningful work. In addition, a third of workers say they would trade a potential salary raise for paid time off to volunteer, according to data from PwC.
Again, simply opening the lines of communication with your key employees can go a long way towards protecting your future, as well as the future of your business. While a sense of meaning and purpose looks different for everyone, understanding what your employees value can help you develop policies that keep them happy.
#3: Office Culture May Be More Important Than You Think
Remote work has been a net positive when it comes to employees’ sense of belonging, satisfaction, and stress and anxiety at work, according to Pew Research. In other words, employees simply feel better working from home.
If you’re worried about losing key employees due to the Great Resignation, you may want to consider whether your office culture could be a contributing factor. And if so, look for opportunities to make it more inclusive for everyone.
#4: Employees Don’t Want to be Tied to One Location
Remote work has made it possible for many workers to leave expensive, crowded coastal cities for locations with cheaper housing and lower taxes. In fact, one PwC survey found that 12% of workers have moved more than 50 miles away from their company’s core office location. Another 22% are considering a similar move.
Many older workers have chosen to retire early due to a variety of factors during the pandemic. However, in some cases, allowing key employees to live where they want may be all that’s needed to keep them onboard.
#5: Employers May Need to Upgrade their Policies
As remote and hybrid work models become more mainstream, many businesses will be able to recruit from a larger talent pool. However, that also means that competition among employers is likely to rise.
As a result, you may have to find new ways to retain your key employees. That may mean updating your compensation structure and employee benefits or giving them the opportunity to have more skin in the game.
If Your Retirement Depends on It, Check in With Key Employees
One thing is true for all business owners: you will eventually leave your business. Depending on your exit plan, the future of your business (and your lifestyle in retirement) may depend on retaining key employees.
The Great Resignation is a good reminder to check in with your employees from time to time. They may give you valuable feedback to improve your policies and procedures and ultimately increase the value of your business.
About the author: Brett Fellows, CFP®
Brett Fellows, CFP®, is the founder and president of Oak Capital Advisors in Charleston, South Carolina. As a small business owner and financial planner, Brett's expert insights help entrepreneurs successfully exit their businesses and plan for a financially secure retirement.