In the previous four months, we have seen more turnover than in the previous two years combined. Why are good people, some who have been with us for 10+ years, deciding to leave?
Get Instant Access to This Article
Subscribe to Worcester Business Journal and get immediate access to all of our subscriber-only content and much more.
- Critical Central Massachusetts business news updated daily.
- Immediate access to all subscriber-only content on our website.
- Bi-weekly print or digital editions of our award-winning publication.
- Special bonus issues like the WBJ Book of Lists.
- Exclusive ticket prize draws for our in-person events.
Click here to purchase a paywall bypass link for this article.
As the CEO of a tech company for 15 years, I have seen employees come and go for many reasons. In a world where small employers are competing for talent globally, the challenges can seem insurmountable. In the previous four months, we have seen more turnover than in the previous two years combined. Why are good people, some who have been with us for 10+ years, deciding to leave?
Not only has my company not cut back on the significant investments we make into our culture and staff, but during the worst of the pandemic, we doubled down, making sure our staff were taken care of.
If it isn’t us, it must be them, right? That’s not it. While any business is going to turn over a certain percentage of employees for performance or compatibility issues, that’s not what’s happening. So what is?
Reduced workforce – Nationally, the labor force has been reduced by 3.5 million people, a situation largely created by the pandemic, but exacerbated by the massive number of Baby Boomers exiting the workforce.
Strong economy – While this is terrific, it creates more demand for talent.
Increased competition – Many companies are offering remote-only positions, targeting markets where their standard offer is going to represent a 20%-30% salary increase.
Desire for change – After putting their lives on hold for 18 months, many people have a desire to swing the pendulum in the other direction.
Increased dependency on tech – Businesses have become more dependent on technology, which means hiring more people to implement and manage that technology.
So what? Most small businesses set their pricing based on local factors – what they expect to pay for talent and/or what their local customers are willing to pay. If they need to compete nationally with major markets on wages, small businesses will find their prices are incompatible.
That leaves a best-case scenario of significant price increases to their customers, who will in turn have to increase their prices. Or a worst-case scenario where a business is simply unable to compete and closes up shop.
So who wins? Not the small business owner. But what about the loyal employees who stay? Surely it means more opportunities, but it also means more work, more stress, and less happy customers. What about the employee who is getting the 30% raise to jump ship? As the economy slows down and automation catches up, a number of those jobs created in a desperate dash will be eliminated.
Furthermore, I have yet to understand how anyone who by design may never meet their employer can truly be engaged. How does one get noticed, learn, grow, get mentorship, or connect with the mission of a company where their contributions will boil down to merely the work they can do from behind a screen in a remote location?
I don’t think any businesses have cracked the code on how to create meaningful engagement across a highly remote workforce being hired faster than it can be onboarded, but we need to face this situation with our eyes wide open and be flexible, innovative in our approach to fixing it.
While I don’t profess to have the answers, I think employers, employees and customers have some real soul searching to do when it comes to what they value and what they are willing to sacrifice to get it.
