NFIB

How to Avoid Losing Employees in Today's Tight Labor Market
03/ 28/ 2002


In today's tight labor market, it's vital for key employees to be retained by a company for the long-term, both because of the cost of replacing and training, and to maintain continuity of all the company's projects. The best way to accomplish this is to get employees involved in the long-term goals of the company. In today's Workshop, contributor Jeffrey Moses offers some tips on how to do this.

Key employees need to feel that the company's ultimate growth and success will assure their own growth and success, both financially and from the standpoint of job satisfaction. For this reason, ownership and managers should make key employees apart of the decision process as often as possible. Involve them in high-level meetings, making them feel a part of the overall momentum of the company. At these meetings, let them know that they are part of the company's inner team -- and that they will directly benefit from the company's success.

Be sure to give tangible financial incentives to key employees as you involve them in the company's inner decision process. When possible, outline projected company revenue and profits, and show how the employee's salaries and benefits (stock options included, when appropriate) will correspondingly increase.

Work with key employees to help them design a "personal mission statement." This should define their responsibilities, current and future, and set goals for their growth within the company. Mention the employee's role in specific projects, current and projected. The mission statements should integrate personal goals with company goals. Ultimately key employees should clearly understand that the future of the company is "up to them."

Keep all employees informed about the financial status of the company -- good and bad. This allows them to feel that the company is really "their company, "not just a place to visit for eight hours a day. The company's financial situation could be discussed by management during a special early-morning meeting for all employees, which could be held two or three times a year. Most companies find that when employees are kept informed about their company's finances, they begin to work harder and smarter because they feel that what they do is important to the company's overall success.

Often a company bases employee raises on job performance ratings. Rather than letting managers or ownership create these ratings, consider encouraging each employee to rate himself or herself, with the understanding that these personal ratings will become part of any decision to raise pay. This empowers employees, and makes them feel that they are more of an integral part of the company.

In general, the more that employees are brought into the mainstream of their company's decision-making processes, and the more clearly they understand that they have a chance to grow along with the company, the better the chance that they will stay with the company for a longer period of time.

Be sure that every employee in the company understands that if he or she is considering leaving the firm for any reason, they should immediately consult with management or ownership. The best way to prevent unnecessary employee losses is to catch dissatisfaction in the bud, before it's too late to address specific needs and changing personal situations.

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