Using Pay to Recruit and Retain
You’re like most employers, using pay to recruit and retain. The pressures of recent years may leave you feeling backed into a corner like you’re forced to. It’s the only real incentive, right?
It’s easy to rely on this widely used, quick fix without realizing the long-term detriments to your company.
But it’s not really a “fix”. It’s a temporary solution.
Rather than scrambling to find more budget for payroll, shift your focus to making your company more attractive – to job seekers and your current team.
Using Pay as a Quick Fix
Maybe you’ve heard your team talking about how much your competitor is paying for the same job they’re doing for you. Or, there are rumblings about how people “deserve more.” You have three options: 1 – ignore the rumors, 2 – give everyone a raise, or 3 – give them a reason to want to stay.
The reality is, it’s easy to pay more. For now. But, what happens when the increase becomes the new normal? A raise of a few thousand dollars a year goes fast when you consider the cost of childcare or groceries.
As your employees adjust their lifestyles to the new pay, they’ll quickly want another raise.
“Once that newness wears off, once that becomes their new lifestyle, they’re going to start looking for other opportunities.” – Ryan Englin
Handing out raises like Halloween candy impacts your profitability, making it harder to compete in the marketplace. Your customers don’t want to subsidize unending raises. The market simply can’t support it, and neither can you.
Using pay to recruit and retain good people works in the short term. But you didn’t build your business for today. In order to attract and retain the top talent in your industry, you have to give them a reason to want to stay.
It Takes More Than Money to Build a Good Team
“If we use money as a way to attract people to our business, we’re setting ourselves up for failure.” – Ryan Englin
When you’re using pay to recruit, you should expect those new hires will leave you when a better offer comes along. Unless you want to enter the endless cycle of hiring, giving out raises, waiting for someone to resign, repeat, it’s time to figure out what it actually takes to build a good team.
You can start by looking at the root cause of your hiring troubles. What are the real reasons people are turning down your job offers or putting in their notice? Does it take weeks for you to get back to job applicants? Does your team understand their value to the company? Do they like the career path that’s available to them?
Determine What Sets You Apart
With all the talk about inflation and cost of living increases, it’s easy to assume the best people want more money. However, research shows employees need more than a raise to make them happy in the long term. According to Gallup, the top five drivers in employee engagement are:
- Purpose: People want meaning from their work.
- Development: Your team wants an opportunity to expand their skills and knowledge.
- A Caring Manager: Taking the time to build relationships that help your team grow benefits everyone.
- Ongoing Conversations: Gone are the days of the annual review. People want to know how they’re doing in real-time.
- Focus on Strengths: Your team needs you to recognize their strengths and put them in a position to succeed and help your company thrive.
Rather than using pay to recruit and retain, you must make your company more attractive to top talent. If you don’t know what sets you apart or why good people stay, ask them:
- What motivates you?
- What drives you to do your best for the company each day?
- What do you love about working here?
- What is the company culture like?
- What makes our company the best?
- Why would you tell your friends to work here?
Taking the time to ask these questions also allows you to build your relationship as a caring leader and create a culture with ongoing conversations. After all, people don’t leave jobs, they leave bosses. Start transforming yourself into the type of leader people enjoy working with.
While you’re thinking about that, how are you different? Your job ads should include something about what it’s like to work for you. If you don’t share it, there’s no way a job seeker will know. Are you a great mentor? Do you have an open-door policy? Do you rely on your team for feedback? Do you turn feedback into action? Market yourself in a way that people are drawn to work with you.
Once you’ve determined what sets your company apart and how you’re a unique leader, you’re ready to begin. Instead of “looking for people” or using pay to recruit you need to start attracting people to your company. Use marketing in your messaging. Make sure your message is attractive to the right people.
Rethink Recruiting and Retention
If you want to stay competitive in this job market, you have to rethink the way you attract, hire, and retain top talent. Finding the right people is worth the effort. Employees who are invested in their work are going to be more invested in your company and its vision.
If you want an expert in your corner, we’re here to help. Learn more about how the Core Fit Hiring System can transform your recruiting and retention efforts.