Due to economic restraints companies are losing valued employees at an alarming rate. The two main reasons seem to be the inability to increase salaries as well as employees either finding a better offer or they simply wish to go into business for themselves. While the rate of cutbacks has significantly dropped since 2010, studies have shown companies are now in a panic as they struggle to find experienced, well qualified individuals who are willing to work for salaries equal to or less than what they were making even a few years ago. As a result, the term employee poaching has become popular because larger companies are offering positions to people who currently have a job rather than to those who are looking for a job. The belief being that if someone was able to keep their job through the years of downsizing they must be a valued employee and therefore have more to offer than someone who was a victim of downsizing. Smaller companies are then forced to hire someone who is either inexperienced or not as qualified to handle the tasks of the former employee who has left them. The irony is that it actually is not about the money, in fact here are some of the main reasons why top employees leave their current job for another.
• Benefits packages: top ranked companies offer better benefits that include health insurance, prepaid legal services, dental care, and even financial assistance such as credit unions.
• Performance bonuses: Larger companies are not actually offering higher salaries but they do offer quarterly or annual bonuses as well as stock options to their employees based on performance. This gives an employee more incentive to go with a company where their hard work will pay off.
• Location: many small businesses around the country moved out of major cities due to the high cost of rent and taxes. This forces people to commute longer to work if they already live in the city.
• Advancement: A smaller business cannot advance employees as quickly or as highly as larger companies can.
How can a smaller business compete with this? One of the fastest ways is to improve the benefits packages offered to employees. Smaller businesses are capable of strengthening their employee benefits packages as a way of sweetening the deal to current employees. The good news is that some of these added benefits do not cost the company anything. An example of this is pre-paid legal services at Countrywide which offers optional legal services which are paid 100% by the employee through small payroll deductions. The employee is protected from major legal fees should they need an attorney for any matter such as divorce, foreclosure, identity theft, legal documents or anything else. The company benefits by strengthening their benefits package without spending any money to do so. You are not losing your employees because of how much money you give them, you are losing them because of how much money you are not saving them. If someone has to pay more in gas to commute to your place of business, and they have to pay for their own legal service plans, health insurance and other things because your benefits packages does not offer them these services, why would they stay?