Highly regarded employers, regardless of their size or industry, prioritize their employees much in the same way they prioritize their customers. And like their intimate understanding of the buyer’s journey, engaged employers understand the value of career mapping and allocate the same amount of time and attention to their employee experience as they do their user, or consumer experience.
If you’re like most companies, despite being mindful of employee retention and paying close attention to the needs of your employees, you’re still at risk of losing them. In their 2018 study, Retention Report: Truth and Trends in Turnover, Work Institute estimated that one-in-four employees would leave their jobs in 2018. And the cost of that turnover is expensive. They totaled that U.S. employers would pay around $600 billion in turn-over costs in 2018 and that by 2020 that cost will increase to $680 billion, according to the study.
Retention is easier said than done, especially right now, and especially when it comes to finance talent. That’s because the national unemployment rate is at a 50-year-low, at 3.6 percent, and the unemployment rate for finance professionals is even lower, at 1.6 percent as of May. In fact, for the first time on record, last summer the U.S. Labor Department announced that jobs outnumbered job seekers.
Retaining top financial talent in 2019 can be challenging. Luckily, however, there are actionable steps employers can take to buck this workforce trend.
Retention Tactics for Finance Talent
To keep finance operations running smoothly, and with minimal employee turnover, try these four retention tactics:
Account for Career Development
• Finance roles are shifting because finance as a function is expanding – read What’s Keeping Today’s CFOs Up At Night? – which means there’s a healthy blend of younger and older workers in finance. This presents both a challenge and an opportunity.
• It’s important to provide continuous career mapping, regardless of the generation of the worker, and to also provide them with the opportunity to continue developing their skills professionally.
• Be mindful of worker expectations and be sure you’re consistently meeting them. Working with a recruiting partner, specifically during the attraction and on-boarding stages of the recruitment process, can seriously help with the vetting and relaying of employer and employee expectations.
• TinyPULSE's 2019 employee engagement report found that 43 percent of workers would leave their companies for a 10 percent bump in salary.
• Paying competitively is important, but it also won’t make up for other employment factors that ultimately drive employees to leave, like bad managers, poor work-life balance or a lack of career opportunity. Be smart about what you pay your employees, but don’t rely on compensation alone to get your employees to stay. It is also worthy of noting that employers should be ensuring that current employees, especially high performers’ pay is in line with what they are willing to pay for new talent.
• Employee referral programs, bonuses and other variable pay plans that incentivize employee performance are good, and they complement a competitive salary without having to overpay for top talent.
Mitigate Management Issues
• The same Work Institute study found that unprofessional or unsupportive managers accounted for 11 percent of why employees leave their jobs.
• Hierarchy and a traditional workplace structure and culture are still fairly common traits among finance teams – which can be off-putting to some Millennial workers who enjoy flexibility and mobility in their roles – but employers should work to mitigate the amount of bureaucracy finance employees have to put up with. This alone can increase retention rates dramatically.
• Having involved managers and engaged executives is also directly linked to the success of high potential employees. Make sure the members of your management team are actively engaging – on a regular, if not daily, basis – with their direct reports. Regardless of what the market is doing, communication is key.
Make It More Than a Job
• Job opportunity and security is just step one to engaging and retaining employees. Then, employees want to know that their work has meaning – beyond the four walls of the company. Align corporate responsibility efforts with employee values to create a shared mission that everyone can get behind.
• There are countless reasons why multi-level employee engagement is important – this Quantum Workplace article cites the top 14, including that engaged employees are more productive, happier and healthier, to name a few.
• The Work Institute study also found that of employees’ reasons for leaving, 13 percent cited a lack of work-life balance. When work and life start to feel more like one in the same and missions and values are shared, that feeling of imbalance decreases.
What to Do When Someone Still Decides to Leave
Despite best efforts, sometimes people still find a reason to leave their jobs. And, by the way, these reasons do not always place the employer at fault. Relocating, a spouse’s job or any number of other, non-employer related factors can weigh into the decision.
If you find yourself down an important member of your finance team, here’s what you should do:
• Conduct an exit interview to gather critical employee feedback. How you handle an employee resignation says a lot about who you are as an employer. Make sure to always put your best foot forward, as you do with all your other employer branding efforts. This can be achieved by keeping in mind the employee leaving most likely has referrals he or she can share. However, you will only realize the fruits of those labors if you handle the situation tactfully.
• When the time is right, ask the person leaving, “If you were to hire someone for your position today, who would you choose?” He or she may have a referral outside of the company in mind, or, better yet, a beat on an internal employee who should be considered for the job. This will also help you diffuse a dissatisfied employee who gets overlooked for the job, should you go with someone outside of the organization. Knowing who’s in line next, and how to keep them engaged, will save you from a resignation ripple effect.
• Be honest while reassuring the other members of the team that everything will be OK (keeping in mind the communication advice given above – being thoughtful and transparent is important). If work will be shared among the team until the position gets backfilled, say that, and explain how you plan to course correct and reward the team for their extra efforts. Be sure to make good on your word. Now is not the time to overpromise.
• If time permits, have the departing employee help hire their replacement. Who else knows the job better than the last person doing it? If not, have the employee mentor other members of the team during the time they have left. The key is to retain what they know so there are no knowledge gaps after they leave.
• Now is also a good time to make sure your team has built-in redundancies, meaning no one person’s departure should be the demise of the finance function. Evaluate the structure and make sure the team is optimized and that there are overlaps where necessary. Succession planning is also a good thing to have done to account for employee promotions, too.
Do you feel prepared to handle an employee resignation on your finance team? Do you feel like you have an engaged workforce? If not, or if you’re not sure, contact us and speak with one of our finance staffing experts.