Amid the ongoing workplace churn wrought by the pandemic and Great Resignation, talent retention is perhaps more important than ever to organizations that want to sustain success and build prosperous futures.
Yet, as workers’ priorities evolve, retaining top-performing talent isn’t as simple as offering greater compensation. While competitive pay remains crucial to attracting and retaining elite workers, cultural factors have gained ground in recent years.
According to Procom’s most recent Voice of Talent report, 68% of workers identified maximum compensation as the most influential factor in accepting a job or — in the case of contingent workers and contractors — an assignment. Hot on the heels of pay, however, were collaborative/supportive work environments, minimal commute, meaningful work, and schedule flexibility.
The benefits of talent retention
As workplace turnover is forecast to remain high in 2023, according to a recent Harvard Business Review analysis, retaining top performers requires an intentional strategy and ongoing effort. Following are a few fundamental reasons why organizations should prioritize retention in the new year if they’re not doing so already.
The high cost of turnover
Recruiting new workers is time-consuming and costly. Recent data from the Society for Human Resource Management (SHRM) pegged the hard costs of recruiting at about $4,700 (USD) per hire. This figure does not account for soft costs, such as the time investment of internal hiring managers and other departmental leaders or onboarding and training processes for new hires.
Top performer turnover
When high-performing talent leaves an organization, they take valuable institutional knowledge and other intangibles with them. Losing elite talent can equate to a loss of future leadership and necessitate grooming existing personnel or new hires to fill the void.
Top performers are often workplace “glue” who elevate the performances of their team members and contribute to the retention of other talent. When high-performing talent departs, organizations may face diminished productivity, tarnished workplace culture, and holes in their succession plans.
Effects on future talent retention
In today’s labor climate, where the demand for skilled employees exceeds the supply, the turnover of top workers makes it difficult to attract and retain other qualified talent. Retaining an organization’s best workers builds stability and institutional knowledge, and it fuels the retention of other skilled workers.
The benefits of employee retention to an organization’s current workforce include team cohesion, reliable productivity, and ongoing skills development. High retention rates also appeal to talented job prospects because they demonstrate steadiness and a positive culture.
Influencing talent retention
While fair pay remains critical to workers, issues related to culture — not compensation — are the top drivers of turnover. Procom’s Voice of Talent survey discovered that a toxic or disrespectful work environment was the leading trigger for talent flight.
While workplace culture is difficult to define and deeply personal, there are cultural aspects that speak widely to contemporary talent.
Autonomy within a collaborative environment
A collaborative/supportive work environment ranked second to compensation among factors influencing talents’ acceptance of jobs in Procom’s Voice of Talent survey. Whether contingent workers or full-time employees, talent wants to be treated with respect, given the opportunity for input and have accessible, supportive leadership capable of constructive insights and clear direction.
While the terms may seem contradictory, autonomy within a team environment is also essential. Workers desire collaborative atmospheres in which they’re trusted to achieve their goals without micromanagement.
Like workplace culture, the idea of “meaningful work” varies by individual. In broad strokes, meaningful work is employment that connects with a person’s values or otherwise engages their skills and interests; it’s work that talent perceives as fulfilling and significant.
This meaning may be inherent in workers’ job duties or come from the culture at large. For example, many employees find merit in working for organizations that:
- Maintain ongoing training and education programs
- Provide access to current tools and technology
- Offer avenues for advancement
- Are dedicated to their communities or charitable giving
- Have strong diversity, equity and inclusion (DEI) initiatives
Flexibility and life/work balance
The importance of job flexibility and work-life balance to talent were trending upward before the pandemic, but they have since emerged as vital. Considerations related to commute, schedule flexibility, and hybrid and remote work were among the top 10 factors ranked as extremely important to job seekers in Procom’s Voice of Talent survey.
Schedule flexibility and off-site work help balance the work-life scale. Another crucial component of work-life equity, according to the Procom survey, is the availability of health benefits and other wellness resources.
Retention requires attention and intention
Talent retention is a constant endeavor that relies on commitment and adaptability.
If there is such a thing as a “best” workplace culture, it’s the one that high-performing talent doesn’t want to leave. That type of culture must be intentionally cultivated and maintained, and it hinges on clarity about an organization’s values and direction.
It’s also important to note that not all turnover is bad – it opens up growth opportunities for top performers and can provide a better working culture if turnover creates a more positive working environment.
Organizations that promote positive cultures in addition to competitive compensation retain quality talent long-term. And that makes them attractive to premier job-seeking talent when new roles emerge, or on the rare occasions that turnover occurs.
The Voice of Talent Report: State of the Workforce
In October of 2022, Procom surveyed 1, 740+ contingent and permanent workers across the United States and Canada to uncover what’s most important to them amidst heightened expectations, competition and uncertainty.
We have distilled the data into actionable insights you can leverage to strengthen your position as an employer of choice and access the skills you need. You can get your copy below: