Focus on non-financial benefits in difficult times
July 24, 2008
Yesterday I was commenting on the likelihood of pay increases being squeezed by organisations in the current difficult economic situation, and the probable backlash from employees in the face of this as their personal finances take a hit from each end with rising living costs such as food and fuel. Salaries are a very emotive subject and this often has an effect on staff satisfaction and retention (although it’s rare that salary is the sole reason for an employee jumping ship as it’s only one in a multitude of motivating/demotivating factors). So what can organisations do to ensure they retain their key staff and still attract new talent in the difficult times, when at the same time they’re under pressure from shareholders/the board to cut costs due to falling sales or rising outgoings?
If an employer is struggling to stay competitive on salaries, then perhaps one option is to concentrate on other aspects of the employee experience. As well known motivational theorists have told us, pay isn’t the most important factor keeping employees happy and committed to their organisation. The opportunity to develop and learn new skills, autonomy and the chance to work with inspirational leaders and within innovative teams are all reasons for employees to feel satisfied with their jobs. In terms of the package available for employees, introducing less costly benefits that have shown to be proven winners such as flexible working options or purchasing/selling annual leave can have as much of an effect on job satisfaction as a big pay rise or bonus.
It doesn’t all have to be doom and gloom for organisations faced with the task of cutting expenditure and even those dealing with redundancies; as long as the remaining employees are given a clear message; that the organisation still has a clear and positive goal, that the employees are a valued contributor to this goal, and that any financial issues leading to cuts are shared fairly across the company. In other words, it’s no use telling everyone that salary reviews or bonuses are going to be a lot less this year when senior executives are clearly receiving huge pay outs, which is something you read about quite a lot in the news. It’s no wonder people get hacked off with their employers when they see this happening when at the same time they’re struggling to pay for the fuel to get them to work!
Comments
Got something to say?