As if the pandemic isn't enough of a challenge for retailers now the retail industry is facing another critical hurdle: finding and hiring staff. Nearly four million Americans left their jobs this past spring and retail came out front with the highest amount of turnover.
That's a grim scenario as retail heads into its busiest, and most prosperous, time of the year — the holiday sales season.
Retail Customer Experience reached out to Dr. Natalie Baumgartner, chief workforce scientist at the Achievers Workforce Institute, for insight on what retailers can do in light of the labor shortage and how they can better retain retail associates once they're hired. Retention is just as critical as finding good employees as replacing one worker can cost as much as $15,000.
Q. Retailers are struggling with trying to hire and at the same time retain staff. Is this one of the most challenging hiring/retention times you've seen and was it unexpected?
A. This past year and a half has been extremely challenging for retail organizations and their staff. Employees have been forced to navigate the stress of uncertainty of massive layoffs, with almost 2 million workers losing their jobs during the pandemic, and a record-breaking number of employees leaving their jobs — in April alone 649,000 retail workers quit. Furthermore, labor shortages are putting more pressure on current employees to do multiple jobs and work more hours than usual.
For retail leaders, as it was for the rest of us, it was nearly impossible to predict the rapid change brought forth by the pandemic, causing an uphill battle for employers aiming to foster a stable work environment. Employees want to feel a sense of belonging and connection to their place of work and the constant stress and uncertainty of the pandemic has made it more difficult for employers to provide this kind of stable culture. As a result, employees are leaving and retailers are struggling to fill these open positions. To overcome this, retail leaders need to prioritize driving engagement across their workforce.
Q. What are some real quick 'fixes' and should the focus be on keeping current staff or finding new staff?
A. To cultivate a culture of engagement that both attracts and retains staff, retail leaders must create a comprehensive strategy that takes into consideration employees' current needs. However, employers can kickstart their engagement initiatives by focusing on two main drivers of engagement — recognition and a healthy work-life balance.
Employees that receive more frequent recognition are more likely to say they feel engaged than those that receive it less frequently. Retail organizations can easily integrate appreciation into their workforce through a recognition platform. These platforms incentivize workers to acknowledge each other's accomplishments and hard work, while also allowing managers to show their gratitude, developing a culture of recognition that's both top-down and bottom-up.
When it comes to retention, the top reason workers stay in their position is work-life balance. To provide a healthy work-life balance, leaders should start by modeling it from the top. Retail workers are more likely to receive core benefits than other industries but these benefits are not effective if staff don't feel comfortable using them. When managers lead by example and openly utilize the company benefits, such as mental health resources or paid time-off, employees are then motivated to do so as well - creating an environment where employee health is prioritized.
Q. How critical is ensuring the culture in the workplace is a welcoming one in hiring and retaining staff and how can a retailer gauge its culture in that way?
A. Creating a sense of belonging and welcoming employees into the workplace is a necessity for every retailer. Research from the Achievers Workforce Institute found employees who are warmly welcomed and invited to be part of their organizational community are twice as more likely to feel a sense of belonging. The same report also discovered employees with a strong sense of belonging are twice as likely to say they would recommend their company to others and that they rarely think about looking for a job elsewhere. Highlighting that a welcoming environment is an important asset for both retention and recruitment.
Implementing continuous feedback loops, such as pulse surveys, can help retailer leaders gauge how welcoming their culture is. Understanding employee needs straight from the source, allows employers to zero in on the critical areas that need improvement, and on areas of success. Going a step further and acting on this feedback encourages employees to continue to provide this type of candor, allowing organizations to more effectively measure the state of their culture.
Q. What are some best practices in engaging current staff and how important is getting feedback from staff about the culture?
A. Our research found nearly half (46%) of employees feel less connected to their company or colleagues since the start of the pandemic and 42% say company culture has diminished. Company culture is the foundation of an organization and a lack of connection results in a lack of engagement. To foster this needed culture of connection, retail leaders must align their business decisions with company values. Employers can preach about their culture all day, but until it is ingrained into every facet of the company, efforts will fall flat. For every aspect of the employee experience, feedback needs to be a top priority as employees desire to have their voices heard and listened to in order to feel appreciated. In fact, when an employee feels heard, they are 4.6 times more likely to feel empowered to perform to the best of their abilities.
Retail leaders can also engage current staff by focusing on DEI and building a culture of connection and belonging. Our research found 52% of employees would be more engaged at work if their employer improved its diversity and inclusion efforts. Before the pandemic, many organizations centered their employee engagement around "fun perks", such as free lunches, gyms in the office, etc., but that won't cut it for employees in today's environment as engagement relies heavily on company values – nearly half (49%) of workers said they'd be more engaged if their employer took a stand on racial and social injustice issues.
Q. What do you recommend a retailer do first in its efforts to boost hiring success and the same for retaining workers?
A. My biggest piece of advice for retailer leaders looking to boost hiring efforts and retain workers is to listen to your staff. No one knows the ins and outs of a retail organization better than its frontline employees. They hold a wealth of knowledge from their biggest pain points to what they enjoy most about the job. These conversations can occur at various levels - from one-on-one meetings to employee-wide surveys.
Employee insight is invaluable and when retailer professionals quickly process their staff sentiment and take action faster and more effectively, they're better able to set themselves up for success in both hiring and retaining staff.