Yahoo Finance 5 tips for businesses to retain staff in 2023
With unemployment still at record lows, employers are working harder than ever to retain staff.
Despite the economic headwinds of high inflation and wavering consumer confidence due to cost-of-living pressures, the Australian job market is still marching ahead in 2023.
Figures from the Australian Bureau of Statistics last week confirmed that the unemployment rate for December remained at a historically low 3.5 per cent, meaning Aussie workers were still in high demand.
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With current skills shortages projected to continue into the new year, Australian employers are focusing harder than ever on retaining their existing staff, since replacing them in the current labour market is proving difficult for many.
But, to remain in their current role, what are the key things employees want?
Yahoo Finance spoke with Peter Acheson, Asia Pacific CEO of leading HR Services firm RGF Staffing, to get his views on the top five tips for businesses to retain Australian workers right now.
1. Flexibility is key
“The single most important factor for employees in the last 18 months has been flexible working conditions,” Acheson said, outlining how job seekers were walking away from opportunities with employers who were unwilling to offer working-from-home options and flexible working hours.
“In the current job market, being able to offer a true work/life balance to your employees is fundamental to retaining them, and the pandemic has turbocharged this.”
Acheson, whose organisation includes well-known recruitment brands Chandler Macleod and Peoplebank - among others - believes providing flexibility around working conditions goes a long way to being perceived as ‘a good employer’, which is critical to staff retention in the current market.
2. Leadership still important
While the pandemic has had a significant impact on what employees want, things such as leadership still remain a high priority for Australian workers.
“The old adage that people join companies but leave managers has never been more relevant in the current job market, which is the tightest we have seen in a generation,” Acheson said.
Having a leadership team that is able to connect with its staff, understands their development needs, and can effectively manage people as well as work processes is critical to success, according to Acheson, particularly with key resources in short supply.
3. Team culture critical but challenging
Although effective leadership is key, it's only part of the equation, according to Acheson, who highlights a positive and supportive team culture as being equally important in keeping key staff engaged.
“Creating an environment where employees feel supported and part of something bigger than just their own work is really important at present, and that is challenging when many organisations have embraced hybrid working arrangements,” he said.
In Acheson’s view, developing a structure that enables group participation and collaboration, when many members are working remotely at least part of the week, is one of the challenges of our time, and companies that get this right are likely to overachieve in terms of staff retention.
4. 'No longer just about the bottom line'
One trend Acheson is keen to highlight is a growing focus on company values and purpose.
“Being a good corporate citizen is growing in importance for many when choosing their next employer. It’s no longer just about the bottom line, especially for younger workers,” he said.
Organisations that can clearly outline their environmental credentials and how they contribute to the broader community are likely to attract and retain workers from most demographics, particularly those in Generation Z.
Given this group is set to make up one third of Australia’s working population by 2030, companies need to make efforts to meet these altruistic expectations in order to continue workforce growth in the future, Acheson said.
5. Higher salaries becoming more of a focus
Although working for a highly profitable organisation isn’t necessarily top of the list of requirements for many Australians these days, the ability to pay competitive salaries still is.
“Salaries need to be perceived to be competitive in order to retain key staff, and this is likely to become more of a factor in the coming 12 months as cost-of-living impacts rise,” Acheson said.
With increasing mortgage payments and higher-than-average inflation becoming a challenge for many, it’s perhaps inevitable that a workforce that knows its skills are in demand is going to be asking for higher salaries to compensate.
However, Acheson is quick to point out that handing out big pay rises isn’t necessarily a silver bullet.
“Although paying staff more will have an impact, it will be a combination of all the above that will secure their long-term commitment,’’ he said.
It’s a valuable piece of advice for Australian businesses, as they seek to navigate continued skills shortages in 2023.
Understanding the shifting priorities of their workforce post-COVID, and aligning these with business outcomes, will continue to be a key focus for many employers in the next 12 months.
As for Aussie workers, they seem set to continue driving a hard bargain for a while yet.
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