I was reading an article in the Wall Street Journal about the recent flood of pay raises, bonuses and other increases in compensation that companies have been giving to their employees after the recent tax cut was announced. As an employee retention speaker and employee retention author, I work with a wide variety of companies in their attempt to retain people. Frankly, I was not surprised when I saw the pay raises and bonuses take place. Wages have not been a major factor in retaining people. They have been a factor in attracting them.
Once someone settles in and feels good about an employer, unless they feel like they are significantly underpaid, they will not actively seek a new job. When they do start to look they look for an employer that can give them a nice pay increase to move. People like to stay in one place, get comfortable (as long as they don’t get bored) and make a home for themselves with an employer. My clients realize that if they give their employees C.R.A.P. (Caring, Respect, Appreciation, and Praise) and pay people fairly to the market, people will stay. Unfortunately, what happens is that many employers don’t keep an eye on the wage market for the particular talent they are trying to retain, fall behind significantly and then the person starts to look. One of my “secrets” in my book “Give Your Employees C.R.A.P…and 7 Other Secrets to Employee Retention” is wages and benefits. You have to be competitive in the wage market or people and if people fall too far behind it can prompt them to start looking for a different job. That is the bottom line.
Many employers, particularly manufacturers, have had profit margins squeezed by their customers for years and have struggled to pay more. At the same time, they have struggled to attract talent that is looking to leave because they can’t pay much more than their competitors. The tax cut gives them that opportunity. Smart employers will realize this is a great tool to gain a competitive advantage and to retain people. Pay raises and bonuses don’t get paid out of benevolence. They get paid because people can afford them and it enables them to keep the talent that they need to make products or produce a service. Smart employers will take advantage or the tax cut to use it as a tool to gain a competitive advantage.
Finally, let’s not forget that C.R.A.P. is still what people want. If they are paid fairly and given C.R.A.P., people will stay with an organization. So…get out there, look at your wage structure and…Give Your Employees C.R.A.P®.