It seems as if every billboard and building is advertising hiring bonuses in an effort to attract a limited labor pool. As labor supply issues continue, many organizations have increased starting pay. We currently see this within many Washington County organizations. Without addressing those compression issues through wage market-level adjustments, the practice of hiring bonuses and increased wage levels for new hires can create significant discord among long term employees. This creates the unwanted outcome of attracting employees at the cost of retaining others.
An Argument for Non-Compensatory Rewards
Although pay level is an important tool in employee retention, it is a short-term satisfier. So, unless you are willing to give multiple raises each year (I tried that logic with my boss and it didn’t work), you may want to focus some resources on non-compensatory rewards. Why? People tend to use raises and signing bonuses for one-time purchases or adjust their lifestyle upward, resulting in the same level of discretionary income.
Raise Attraction & Retention Levels
We can design other ways to raise the attraction and retention level of your entire organization by using those funds in a different way. In other words, ways that create “stickiness” to your organization and our communities. Those can include:
- Supplement child and senior day care expenses
- Help pay down school loans incurred in exchange for agreements to remain employed a specific amount of time
- Help with a home purchase down payment to help get employees past the down payment barrier
- Pay dues for civic organization membership and provide time off to participate in those organizations creating a sense of community engagement
- Time off as a reward
- Events that include employees’ families
- Happy employees respond better to employee referral programs that have flexible rewards rather than strictly cash
Note that many of these options are non-compensatory. According to a study by the Incentive Research Foundation for the Incentive Marketing Association, 65% of employees prefer non-monetary incentives instead of monetary rewards.
Consider how you can increase your return on investment through programs focused on making your organization more attractive to current and prospective employees.
For more information regarding how EDWC can help your organization, get in touch today.