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Small Business Center

Hiring Is Hard Right Now: Tips for Hiring and Keeping Top Talent

February 16, 2024

Labor has become the foremost challenge for small business retail owners, prompting a reevaluation of recruitment and retention strategies.

In 2021, corporate advisory and business transformation firm Lotis Blue Consulting wanted to get behind the headlines — what exactly was the reason for The Big Resignation, for instance? — and ask retail workers what inspired them to stay at or leave a job. “We had a lot of our retail clients ask us: “What the heck do we do about the turnover crisis?’” said Lotis Blue chief behavioral scientist and head of transformation Aaron Sorensen.  At the time, there were also “wage wars that were taking place in terms of escalating prices, and supply chain issues were just trying to peak their head,” he said. Retailers “were in a crisis and they wanted us to help figure out why people were leaving.”

Thus, for the past three years, Lotis Blue has surveyed 1,000 retail associates, gathering feedback on what values and factors make them decide to stay at or leave a retail job.

The third edition of 2024 The Future of Retail Workforce Study based on surveys conducted during the lead-up to the 2023 holiday season and lead-authored by Sorensen, came out last month. While some trends have stayed the same, others have changed. People still want to be paid what they’re worth, for instance, but safety has become one of retail workers’ top concerns.

Sorensen offered tips for attracting and retaining frontline retail associates.

1. Play both offense and defense.

The factors that cause someone to want to leave differ from those that cause someone to want to stay. To build a stable, happy workforce, address turnover drivers like lack of flexibility and insufficient recognition while also promoting job engagement and fulfillment. “In order to hold on to valued employees, retailers must simultaneously provide an environment where there are more factors that make workers want to stay and fewer that make them want to quit,” he said.

2. Tighten up security measures.

The health and safety of a retail establishment now rank among the top three reasons employees choose to stay at or leave their jobs, according to the latest study.  That's because, Sorensen hypothesized, “retail safety and organized retail crime have been significant in the headline and the threat of violence — real violence — is now in the psyche of the frontline worker.” According to a NRF’s 2022 Retail Security Survey, organized retail crime incidents increased an average of 26.5% for retailers in 2021. Eight in 10 also reported increased violence and aggression linked to thefts in their stores.

To assuage, attract and retain workers who fear for their health and safety, implement security measures, Sorensen said. That could mean panic buttons for emergency assistance and ensuring you have a well-lit premises or, if you have the funds, hiring trained security personnel to monitor the premises.

Additionally, communicate a clear policy that frontline workers should not intervene in the event of a theft. “It’s just not worth it,” Sorensen said. “We’re talking about not only the threat of violence and aggression but the trauma that follows after that I think is really top of mind for folks in retail.”

3. Highlight the social aspect of the job.

Another factor employees consistently cite as a reason for staying in their jobs is their co-workers. “We’re social beings,” Sorensen said.  Post-pandemic, this human connection has become even more vital.  Yet, the 2023 EY Belonging Barometer 3.0, released in September, found that 75% of workers report having felt excluded at work. That’s based on a May 2023 survey of more than 5,000 workers in the U.S., the U.K., Germany, Singapore and India. Retailers, whose setting provides constant interaction with customers and team members, hold an advantage over competitors. Retailers can leverage their social environment as “an appealing differentiator,” Sorensen said, that provides a more engaging and fulfilling workplace.

And to create a cohesive working environment, Sorensen suggested hiring employees who have experience on teams. It could be a high school sports team or a college club, anywhere where they had to work together to accomplish a goal. “That’s really going to be a key thing,” he said.

4. Consider your employee profile when deciding on benefits and incentives.

Employees in different retail subsets are motivated by varying factors, according to Sorensen. For example, in the most recent Lotis Blue survey, education and benefits like training programs and the opportunity for career advancement formed a significant driver for employee retention and attraction in big-box stores like Walmart. One can see those values in Walmart’s advertising, Sorensen said. Many of the retailer’s promotions discuss CEO Doug McMillon’s start with the company as a teenager and his progress through various roles en route to CEO, Sorensen said.

However, at fast-casual restaurant, the education and benefits factor was 26th most important among factors that employees would consider when deciding to stay at a business,” he noted. “That workforce would much rather have free burritos, free access to food and a flexible schedule than a 401(k). They prioritize immediate benefits over long-term considerations.”

Tailor incentives to match the preferences of your employee demographic.

5. Emphasize employee engagement.

“One thing I often tell folks when I’m speaking at retail conferences is that I worked at Abercrombie & Fitch for three months [as a teenager] in the early ’90s and it was so boring folding cargo pants that I just couldn’t do it,” Sorensen said. When designing and advertising available jobs, avoid that “boredom factor,” he said. One way to achieve that is to ensure that there’s room for engagement and encourage employee input in your descriptions. “If you are a small electronics store, for instance, your business tends to attract employees who are passionate about the product.” Tap into that passion, Sorensen suggested, as it can lead to valuable insights about your customers and employees and can result in loyal employees.

6. Ensure your rates are competitive.

Be aware of the prevailing wages in your industry and ZIP code, Sorensen said. If your workers discover they’re being paid less than their counterparts at other establishments or if a potential applicant perceives your pay as low, they are more likely to leave or to say no to a job offer, he said. “If you don’t feel like you’re getting paid your worth, relative to your neighbor, then it becomes an extreme dissatisfier, and you can’t get beyond that.” Take that off the table.  Companies like Lightcast Data gather information on job postings. “You can see the distribution by ZIP code of what people are paying for different retail jobs, and it’s dynamic to the day,” he said.

Think of your job descriptors like a magnet, Sorensen said. “You have the positive that’s going to attract and the negative that is going to repel.” And keep up on worker trends. What caused a person to stay this year might not be the same thing that keeps them there next year. Being proactive and responding to shifting priorities ensures that your job descriptors continue to resonate with employees over time.

By Rebecca Meiser

Contributor, Commerce + Communities Today and Small Business Center

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