Get better at attracting and retaining team members by participating in two CUES surveys by March 31—and then purchasing the data.
Practically every employee at any organization has at least entertained the prospect of leaving their current workplace. Whether a fleeting thought or a serious consideration leads them to actively pursue other employment, this is the reality of the current marketplace.
We are in the midst of unprecedented times of employment activities. While it is well documented that baby boomers are staying in the workforce longer than ever, the sheer size of the generation still equates to thousands of them retiring every day. In addition to the positions that baby boomers are leaving vacant, new jobs are being created all the time. Currently, there are more jobs available than people looking for employment, creating a job surplus that is growing daily.
This job surplus has been coupled with historically low unemployment rates (3.7% in 2019) that we have not experienced since the 1960s. With excess jobs and fewer people to fill them, there has been a power shift in workforce dynamics from the employer to the employee. Many employees who thought the “grass is greener” elsewhere were in the past too fearful of the unknown to pursue a new position. Now, they know they are in high demand and are more likely to make a move. As a result, turnover rates across all industries have exceeded 44% annually, driven by 27% quit rates.
With historically high quit and turnover rates, the hiring and onboarding process can feel like a never-ending cycle. The continuous flow of new hires is a strain on institutions from a financial and human resources standpoint. It takes time to fill the position, train and onboard the new employee, plus present a package that attracts the talent you are seeking.
It is hard enough to attract new employees, but once you have them, the question now becomes, how do we keep them? To answer this question, we need to understand why employees are leaving. Are they looking for higher compensation levels or an opportunity for advancement? Have they become complacent/bored in what they are doing? Do they simply want to try something new, feel unappreciated by the organization or seek a better work/life balance? Ultimately, they are dissatisfied for one reason or another—or hundreds of reasons.
Conventional thinking tells us the best way to attract and retain employees is to increase base salary levels and/or year-end bonuses. While research has historically supported this, and even current research shows this can improve attraction/retention rates, there is a compensation cut-point where monetary increases become substantially less important to job satisfaction than other aspects of their work.
In a recent study, we asked individual respondents—with a median base compensation of $80,000—to rate their overall job satisfaction along with how they feel about several attributes of their job. We found that the top five job-specific attributes that correlated to job satisfaction were:
- Personal fulfillment
- Involved in decisions
- Valued by the organization
- Recognized for their work
- Sense of accomplishment
Looking at the top 10 job attributes on the list, none of them had anything to do with compensation levels. In fact, compensation ranked 13th overall in terms of the importance of correlating with job satisfaction. It may seem surprising that compensation was rated so low, however, the pay of this group exceeded the national averages for other professionals ($47,060 as reported by the Bureau of Labor Statistics’ usual weekly wage report).
Since the basic compensation needs of the respondents are generally being met, less tangible factors were more important. While the responses to the survey are weighted more toward higher-earning individuals, the results should be considered when developing a workplace environment and total compensation packages for those higher-earning employees (e.g. management, senior management, executives).
The findings of this study provide powerful information for an employer to have in recruiting new talent as well as ensuring the commitment of those currently employed. Consider if there were a way to provide “extras” within the work environment that may not come with as large of a price tag as salary (and may be viewed as more important than the number that appears on their checks). Things like purpose, fulfillment, value and recognition are all free and, if framed appropriately, can be the difference-maker in employee longevity at your organization.
It is easy for employees and employers to focus only on the compensation aspect of what is being offered for services. Salary is a tangible, quantifiable number that is easily understood. However, it is becoming vital for employers to promote and communicate the value of the total rewards package of being an employee. Of course, the full package includes compensations levels, plus conventional benefits (health, vision, retirement, profit sharing, etc.), vacation/paid time off, and the work environment/culture of the company (advancement opportunities, flexible schedules, being appreciated, a feeling of purpose, etc.)
I always recommend that employers highlight the total rewards package at annual reviews to ensure their employees are aware of what they are getting and taking advantage of all of the offerings. This is especially true for retirement plans that do not auto-enroll employees, which can often lead to them missing the matching terms and not knowing the full extent of their compensation.
To help credit unions better understand compensation practices and policies in the industry, CUES offers the CUES Executive Compensation Survey and CUES Employee Salary Survey. These surveys provide detailed results of compensation and benefits packages offered by credit unions. Additionally, new to the survey this year, questions have been added on attracting/retaining employees and the top concerns/issues credit unions are facing. The results of the study will provide invaluable benchmarks to help you provide the right total rewards package for the talent you seek to help your credit union grow and improve.
Both surveys are now fielding. Participate by March 31 to take full advantage of these offerings.