Johnny C. Taylor, Jr. is president and CEO of the Society for Human Resource Management. Views are the author's own.
Throughout the tumultuous journey of the past 21 months, HR has responded admirably to an unprecedented series of challenges. Business and society-at-large have grappled with problems on health, economic, social, political and environmental fronts.
HR’s role in ushering business through this array of disruptions has been focused on maintaining the viability of the workplace. In essence, HR has acted as workplace first responders working to stabilize organizations in the midst of calamity. Through adversity, we’ve witnessed the power HR has to uplift business. But as we take a step back and survey the last two years, we are realizing how much more HR is capable of.
Businesses’ most pressing challenge to date is the lack of access to human capital. Leaders are seeing staffing shortages threaten our economic recovery and limit the expansion of business. Many organizations are scrambling to respond to a surge in workers leaving their jobs at unprecedented levels, dubbed the Great Resignation or Turnover Tsunami. While some point to the Great Resignation as being a result of the COVID-19 pandemic, the origins of these workforce trends predate the emergence of COVID-19 and have been accelerated by the pandemic’s onset.
In response to the Great Resignation, many businesses have aggressively mined the same talent pool to depletion. With an abundance of cash resources on hand, organizations competing for talent has led to widespread wage inflation. In a recent SHRM survey, almost one-third (32%) of organizations that have seen higher turnover these last six months implemented new or additional employee referral bonuses. Twenty-eight percent have implemented new or additional merit increases, and 27% said they have implemented new or additional spot bonuses (beyond annual or holiday bonuses) to reduce turnover.
Even workers who are content with their positions are drawn to lucrative opportunities, further exacerbating the turnover trend. As the SHRM survey highlights, more than half of U.S. workers (55%) say they’ve had direct colleagues voluntarily leave their organization within the past six months, leading many to reconsider their options. Businesses cannot survive — much less thrive — without adequately meeting their staffing needs. Moreover, understaffed businesses risk overburdening their remaining workers and further undercutting retention.
Employee turnover data can help assess the health of an organization and the effectiveness of its talent strategies. But data is more than just numbers — it should reveal the reasons employees stay or leave to better inform retention strategies. In focusing on keeping the lights on, organizations have lost sight of evolving worker needs. This disconnect between employee and employer is something HR is uniquely suited to solve.
There are several emerging employee expectations that stem from workers’ desires for control over their career path and desire to be valued as whole, unique individuals. It is critical for organizations to monitor employee expectations as they evolve. Losing sight of what workers want leaves employers behind the talent curve. HR’s expertise and responsibility are to unite the interest of employees and employers to optimize business performance.
In an ultra-competitive talent market, cash is king. Employee perks no longer carry the weight they once did.
Johnny C. Taylor, Jr.
President and CEO, SHRM
According to job candidates SHRM speaks with, career development is the new job security. They realize the career investments employers make in their growth and development will serve them in their current position and downstream in their careers.
The push for remote work, hybrid work and flexible scheduling stems from the desire for greater workplace flexibility. While some people want a 100% remote-work experience, many are looking for the flexibility to accommodate their style of work and/or their competing demands from their personal life.
To workers, base compensation and bonuses give them the freedom to create their own "perks."
Additionally, ancillary diversity initiatives have been pushed for decades but workers felt minimal impact. Today, workers are looking for diversity, equity and inclusion to be a cultural imperative in the workplace. They want to feel the tangible advantages of an inclusive work culture.
Finally, the importance of empathy cannot be overlooked. For too long, workers have been viewed as containers for skills and experiences. Businesses must fully understand the physical, emotional and mental needs of their people, and empathy is the first tool in fostering this understanding. According to a recent SHRM survey, 93% of workers agree they would seek an empathetic company if they were seeking a job. Empathy, as a value proposition, has a measurable, tangible impact among workers and on business performance.
Stewards of the workplace
Our actions — big and small — ripple out far beyond this moment. As HR professionals, we can empower others, drive productivity and value for our companies, improve society, and perhaps have a positive impact on people we will never even meet.
HR has long waited for our turn at the decision table. Now that we’re there, we must seize this opportunity to effect real change — to shape the future of work. As we have seen, the business climate certainly impacts the workplace. Conversely, the workplace also has the power to impact the business climate. As stewards of the workplace, it is within the power of HR to make a difference in business and the world.
Business is best served when HR leverages its knowledge, expertise, tools and support to interpret trends and regulations, apply new approaches, and succeed in disruptive times. It is not enough to be ahead of the curve; we have to do our part to generate the curve. Now is the time for HR to — as SHRM’s slogan encourages — Cause the Effect.