Investing in and retaining employees crucial for the future
A report from the spring Mackinaw Policy Conference discussed the need for skills in order to meet the needs of businesses in Michigan. The gist of the report was that skill requirements are changing as jobs are changing, and we have lost some key skills that, in the past, brought business to Michigan.
It is not surprising if you’ve watched how business and communities have addressed the issues associated with education and investment in people over the last few years. Everything is about reducing costs, and not in a selective way. There is no thought about what might be needed at some point in the future, even the short term future of three to five years.
Two leadership perspectives
We see this every day as CEOs get more tied up in the quarterly results published to assure analysts they are doing a good job for the investors. The short-sightedness is sometimes incredible. These people are often saving their way out of business because they are not doing strategic reinvestment in the business, particularly in people. Investing in human capital is just a buzz phrase. They wonder why there is no employee loyalty. They wonder why results are not as desired when the employees are only expected to hit imposed targets. And they take no notice of the spread between executive pay and workers’ pay getting wider each year. The message is loud and clear: Look out for yourself, as you are just a cog in the wheel.
The leaders who are pushing for investment in development — and there are a number of them — whether it is infrastructure, people or intellectual knowledge, will be the winners in the long term. It is amazing what happens when people are asked to get involved and feel they have an actual say in what the results look like. They become invested in the process because they think someone believes in them. These people won’t walk away and leave their employers hanging, and workers in government agencies or school systems won’t just go through the motions when they are actually in a position to make a difference.
What can we expect?
As we come out of the recession, the revised economy is starting to make a difference in people’s lives, but this may be a two-edged sword. There are a large number of folks who will take a different strategy about their work lives. The good workers will change jobs or perhaps careers if they are sick of the disrespect shown the past few years. The baby boomers who have been waiting to change their status will start to come forward. There are people who think they got the short end of the stick for the past eight years who now will take counteraction many employers won’t like. What is going to be left to many employers is second-tier talent, people with partial skills and a young work force that isn’t trained or educated.
Following are some examples of results stemming from lack of people investment:
One organization we encountered decided to set new education standards by requiring a high school diploma or a GED to be hired. They had to reverse the policy as they could not fill their positions.
At the other end of the skill spectrum, we have a heavy push in the current discussions on immigration for two to three times as many H1B work visas to fill critical jobs with foreign staff, since domestic talent isn’t available.
A new report shows nearly all new teachers coming into the education system are unprepared for the job. They are still being trained for the classroom of 30 years ago.
What will employers do when the real shortage of brain power arrives, one that many economists warn is coming when the baby boomers leave the work force?
Working on a solution
We can’t solve the whole problem, but business owners had better give serious thought to employee retention. It is sort of like the issue of customer service: You do it because you know how much harder it is to get a new client than to retain an existing client. It’s the same thing with quality employees. When you count the hours of training to bring someone up to speed only to discover they don’t fit or you’ve lost key customer contact or process knowledge and you have to start over, employee retention makes a lot of sense.
As a prudent businessperson, identify the issue, apply your resources where they will do the most good and, if you can, do a simple fix with limited expense, which is better than a complex fix that costs a lot of money. That is exactly what I think is possible with the potential large loss of talent in the baby boomer work team. You don’t have to wonder what motivates them; you know what they can do and you can ask them to go the extra mile, as many of them have fewer time demands than those with family and social pressures. What you need to do is recognize that most of them are looking for “environmental change.” That is what people are about when they consider retirement.
You should understand that people don’t really retire in the sense that they did 25 years ago. They don’t want to watch the world go by, or fish or play golf every day. They want to feel useful. They want to live, not just exist. Employers who figure this out will be the real winners, especially when they see how a little effort to help these employees move into the third phase of their lives can pay off.
Instead of pushing these people out, why not retain them for another five to seven years? Help them approach the next phase of their lives and be integrated with it. They will appreciate the support, they will stick around a bit longer, and they will work very effectively for you. How do you do this? We’ll share some ideas with you in our next column: Planning for the Third Phase.
Ardon Schambers is a principal with P3HR Consulting & Services, based in Grand Rapids.