How to retain employees

The U.S. labor market is at its lowest unemployment rate in 50 years. With a rising demand for talent, employers are competing to attract and retain employees—and are struggling. The “quits rate,” the number of people who voluntarily leave, rose in 2018 and remained at its highest since 2005. Of the employees hired, 29% leave within their first 90 days and 74% turnover annually. It costs an average of $5,864 for each person who leaves and those costs can really add up.

Recent trends suggest that hosting employee events, a ‘cool’ workspace, or dolling out swag will keep your team happy and engaged. Unfortunately, that doesn’t deliver desired results—especially in the hospitality industry. So how can you do a better job of attracting and retaining talent?

Pay a fair wage. 51% of Americans are just one paycheck away from a financial crisis. When cutting costs means choosing between paying for groceries or an electric bill, the only real choice is to look for higher-paying work or additional opportunities to make money.

By paying higher wages, you ensure your employee’s mind is focused on the job, not on how they’ll pay their next bill. Moreover, low wages leave you vulnerable. Every penny adds up. Why let a competitor scoop up your best talent and all their institutional knowledge over a few cents per hour?

Instant pay. When you live paycheck-to-paycheck, pay frequency is a big deal. Despite making enough money to pay their bills, many workers are still charged late fees because their paycheck hasn’t arrived yet. To compensate they often turn to payday lenders or overdraft accounts, incurring huge fees. They do this because they have to wait to be paid.

At a minimum, there is a federally mandated waiting period for ACH transfers of three to five business days to transfer funds between institutions. However, there’s a bill currently being proposed to change this. Many businesses face their own cash flow issues, making it challenging to pay workers more frequently.

The simple solution? Look for services that can help you pay workers at the end of their shift.

Schedule ahead. Your employees need to have predictability in their lives—to plan childcare, chores, and time with family. While predictive scheduling laws were passed in a number of states, the more time you give employees to plan, the less unnecessary stress your employees will face.

However, there will always be call-outs, no-shows, and quitters. Many states require that you offer new shifts to current employees first and use scheduling software that automatically finds employees eligible to take additional hours.

Offering hours to your pool of employees may not fill all open shifts though. That’s where on-demand staffing comes in. Supplement or temporarily grow your staff with short-term staffing. Outsource your stress and work with someone who can provide you high-quality vetted talent.

Be Flexible. Employees need flexibility in their schedules. Accommodating them, within reason, means they’ll be able to spend time how they want while earning enough to live. Who wouldn’t love an employer who allows you to earn the money you need without having to miss time with friends, family, or just recharging?

Keep an open-door policy. Don’t wait for an annual review to evaluate performance. Your employees are on the floor, operating in the details of your business and are often the first to spot a problem. Using only a top-down approach to performance reviews means you’ll miss important suggestions on how your business can improve.

Look at performance reviews as a two-way street.  Give and get feedback as often as possible—at the end of each shift if possible. When you care about providing a good working environment and implement employee feedback, employees feel like a part of the team. They’re more likely to feel comfortable talking about the big problems when they come up.

It’s not just a job. Your workforce is a community, and especially in the world of hospitality, they are the face of your business. To create a strong employee community, hire professionals with experience. When employees see coworkers operating at their best, they rise to the occasion, expanding their professional and institutional knowledge. Not only do they stay longer, but good talent attracts good talent—often through personal referrals.

As you build your community of high performers, employees can be thought of as either a niche specialist or an industry specialist. Niche specialists are the ones who know every in and out of their job. Successfully managing them means providing ongoing training to help perfect their skills, recognizing their hard work, and giving opportunities to mentor new employees.

Industry specialists are the employees who immerse themselves in the world of hospitality—they need to understand their long-term career in the industry. Providing a clear career path that includes consistent feedback on performance, opportunities for job shadowing and promotion, and investing in them as a person will help earn loyalty.

When in doubt, place yourself in your employees’ shoes when you make create or change policies. Often, when you take the extra step to make life better for your employees, they’ll make your life and your establishment better.