Survey uncovers concerns about staff retention in current economic environment

In a recent survey conducted by Kettering-based HR Solutions, it was revealed that 50 per cent of respondents expressed concerns about staff retention in the current economic environment. The HR consulting firm emphasised that SMEs can boost their profitability by developing a strategic and cost-effective people plan that fosters a solid, engaged, and committed workforce.

Greg Guilford, CEO of HR Solutions pointed out that taking care of employees' needs plays a crucial role in their desire to stay with a business, stating that when an employer takes care of an employee's needs, the employee is more likely to want to stay with that business.

With challenges arising from changes in UK immigration and employment law, as well as labour and skills scarcity, it becomes imperative for businesses to maintain employee satisfaction and loyalty. This is especially as a report revealed that vacancy growth is at its lowest since early 2021, but employers still cannot find qualified staff – especially as wage growth continues, albeit more slowly.

The HR Solutions CEO stated that it is much less expensive to retain employees than to hire new ones, saying that businesses should consider creating a people plan that is in line with the business's plan to help their staff members advance and develop.

The survey highlighted the economic benefits of retaining employees, including increased loyalty, reduced employee transfers, fewer interruptions within teams, stronger customer relations, improved brand reputation, and a highly skilled workforce. The survey also revealed that retention also leads to cost savings by reducing administrative fees associated with resignations, hiring expenditures, and productivity losses during the onboarding and training of new employees.

Furthermore, the HR Solutions survey emphasised the importance of enhancing staff capacity through upskilling to attract and retain personnel, while also supporting current and future business needs.

Guilford suggested that implementing strategies such as upskilling and emphasising employee benefits can help ensure that top employees remain committed to achieving positive outcomes for the company. By increasing staff knowledge, skills, and experience, businesses can stabilise their operations.

The HR Solutions SME Survey serves as an annual pulse check on the SME world, examining how businesses were affected in the previous year. The survey outcomes were used to forecast important elements for the coming year and to provide insights on leveraging opportunities and overcoming challenges.

The survey also reveals that employees are reevaluating their salary and benefits due to current economic pressures. To maintain a productive and motivated workforce, reward and recognition programs can be effective. In a recent webinar, Guilford shared that 27 per cent of participants stated their intention to increase pay in 2023, and 77 per cent planned to give a one-time bonus.

However, Guilford acknowledged that bonuses or wage increases are not always feasible strategies. He suggested alternatives like offering assistance through share-saving programs, employee assistance programs, or employee cash plans that cover essential services like eyeglasses and dental checkups.

Furthermore, Guilford stressed that creating a strong company culture characterised by shared values, objectives, attitudes, and practices can contribute to employee retention. A positive work environment fosters happiness among employees, increasing their likelihood of remaining with the business.

The survey results indicate that 39 per cent of SMEs rank company culture as the third most essential aspect of people management. Moving forward, Guilford emphasised that employee retention remains a critical theme in 2023, and businesses must proactively work to reduce worker turnover. He stressed that SMEs must maintain competitive pay and benefits packages or risk losing top personnel to rivals as the cost-of-living problem persists.

To address these issues, HR Solutions will be hosting a webinar on Thursday, August 10, at 10 am, where they will share their expertise.