If you are not proactively taking measures to retain your people, someone else is trying to steal them. Here’s what to do about it.
Someone is recruiting your employees, and your employees may be looking for new jobs. What are you doing to keep them?
According to Prudential’s Pulse of the American Worker Survey, an estimated 25% of workers are planning to look for a new job “once the threat of the pandemic has subsided.” This data was collected in March 2021, and we’ve only seen the labor market continue to speed up since then.
In April 2021, The Wall Street Journal reported about how trucking companies are boosting pay and bonuses as the need for drivers continues to increase. One trucking company in the article cited that wages for recently certified drivers jumped by more than 40% in early 2021.
All of this data supports the notion that not only are your employees willing to look for new jobs or move to new companies, but also that those other companies are ready and poised to lure them away from you.
We’re already seeing significant churn and challenges in retaining and hiring the right talent across the industry: for freight brokers, carriers, and freight tech providers as well. Welcome to the Talent War of 2021: It’s gonna be a bumpy ride.
We’ve spoken to our network of Industry Leaders to understand why such a high number of employees are open to new employers, and what are the real drivers of employee retention. We identified 5 key factors: Career Growth, Flexibility and PTO, Community Impact, Bonus Incentives, and Base Pay.
1. Career Growth
The majority of the group in the Prudential survey, 80%, cited concerns about career growth as an influencing factor for being open to new employment. Does your business offer development tracks? Developmental training? Coaching? Mentorship?
If you do, that’s great! Take time to review and revive those programs so your employees understand how to be involved and make the most out of them.
If you don’t, you need to organize clear career growth messaging and programming for your employees yesterday. In the world of hyper growth startups, employees can rapidly ascend the ranks as a business scales.
Charlie Saffro, President and Founder of CS Recruiting, explains that career growth has always been the number 1 reason people change jobs in our industry. Something interesting that is happening, especially after what we all went through in 2020, Saffro explains, is that people are now more willing to make lateral moves at a company where they feel truly appreciated. Sharing your appreciation for your employees is a key part of a strong company culture.
CarrierDirect CEO, Peter Rentschler, chats with Kaylee Nix and Anthony Smith on FreightWaves NOW about The Talent War in Freight. Catch the full segment here.
2. Flexibility & PTO
Do you offer benefits like remote work and flexible hours? Unlimited PTO? While benefits such as remote work are more realistic than flexible hours in our transportation and logistics space, you owe it to yourself and your team to do an honest evaluation of what could work for your business. Across the freight industry, we are getting to the point where almost every role that does not require hands on a truck or hands on freight could be operated remotely.
If technology is the reason why you are unable to allow many of your employees to work remotely or with more flexible schedules, it is critical that you evaluate that right now. We’ve seen first hand that companies with strict in-office requirements for roles that could be done remotely have higher attrition. Employees feel that management doesn’t trust them, and they feel disempowered.
KJ McMasters, President of Talent Solvers, agrees that flexibility is important to employees and should be an integral part of your company culture, thus contributing to your retention strategy. He adds that more important than offering flexibility and unlimited PTO is truly encouraging employees to use it and embracing them when they do.
3. Community Impact
McMasters also shared that the impact your company and team has on the greater community is an increasing priority for employee happiness and retention. It’s great to know that employees want to contribute and give back to their communities. Providing opportunities to do this with their peers as part of your company, further strengthens your company culture and contributes to a happy, healthy workplace.
Best yet: McMasters cites companies that participate in team-wide or company-wide volunteer days. Alternatively, he notes that some companies, in addition to PTO days, also offer Volunteer Days. This is a very meaningful benefit for a lot of people, and it shows that you care not only about them, but also about the greater good.
4. Bonus Incentives
Last but not least, we have to discuss compensation. TransportDive states that pay and work-life balance are amid the top retention factors for truck drivers. It’s no secret that compensation is a key part of any employee retention process.
Huge bonuses are happening across banking and insurance industries. We’re seeing this in freight through more lucrative, uncapped commission programs. There has been unprecedented job growth. With all of the new venture and private equity money coming into our space, freight companies have come to care more about results. Thus, they are financially incentivized to offer very competitive compensation packages to high performers in the industry.
It will take some consideration to create the right incentive structure that works for you and your people, but you need to do something. Incentives can be done in short, medium, and long-term retention bonuses, base wage increases, profit sharing, and stock options.
Whether you need to tweak an existing program or conduct a complete compensation overhaul, you need to be intentional about the changes you make or risk driving the wrong behavior. We’ve seen a 125% increase Year over Year in the number of our consulting engagements that touch compensation.
5. Base Pay
The norm has become new hires who care more about earning a higher base compensation - even if that means a lower total compensation. This is due to the fact that you need to prove a base salary to get approved for things like car loans, credit cards, apartment leases and mortgages. Saffro also points out that a higher base salary provides a level of stability that is more appealing these days for many workers. The historically low salary in our industry for roles like customer and carrier sales reps has become a blocker for attracting new talent. The good news is this is something you can fix.
Your competition has the same growth goals that you do. You are not just competing for customers and business; you are fighting in the Talent War. Your retention strategy needs to be as much a focus as your recruitment strategy.
Saffro states it clearly when she says, “You can’t recruit if you can’t retain.”
McMasters adds to the picture, “This is the most candidate-centric market that I've seen in over 15 years in Talent Acquisition.”
Employee satisfaction, and thus employee retention needs to be a top priority for businesses like yours that want to be able to successfully retain talent and continue your business growth journey.
One key takeaway from this article is: It doesn’t all come down to compensation. Yes, paying more can make it easier to get people in the door, but keeping them comes down to how you treat them as members of your team. This is what determines the winners and losers of the Talent War.
No matter how you look at the data, the sentiment is undeniable: People are open and, in many cases, eager to find new jobs when the pandemic settles down.
Well, the pandemic looks to be settling down soon. Are you confident that you can keep your talent?