The notion of employee loyalty is complex and multi-faceted. It’s recently become even more complex following the “Great Resignation” that’s swept through much of the country and affected most industries over the last year.
Organizations are scrambling to hire talent to fill vacant roles and figure out what they need to do to keep their valued employees. Their concerns are well-founded, given that according to a recent study, only about half of employees – whether white- or blue-collar – are satisfied with their jobs.
Millennials and Gen-Z, who make up a fair portion of today’s workforce, are well-known for their willingness to switch jobs more frequently and spontaneously than their older counterparts.
This convergence of forces has made it imperative for businesses to strategically build employee loyalty in the workplace.
In this article, we’ll explore how.
The concept of “employee loyalty” describes the feelings and mindsets that make people feel a sense of attachment and belonging to their employer. But how well is it really understood? Ask a handful of people how they’d describe it, and you’ll likely get a range of different answers.
Some employers might describe a “loyal” employee as one who doesn’t steal from the organization or share confidential information. Others will say loyal employees are those who are willing to burn the midnight oil from time to time to complete important projects or those who never badmouth the company or their colleagues.
Most people will define employee loyalty in terms of how likely a person is to succumb to the lure of a higher-paying role in another organization.
Loyal employees are genuinely concerned about the success of the company. They’re prepared to invest their time and energy selflessly to do what they can to grow that success, both daily and over the longer term.
Loyal employees demonstrate perseverance and dedication. They’re never the ones to slack off just because the boss isn’t looking.
Rather than seeing challenges as nuisances or hurdles, loyal employees view them as an opportunity to find creative ways to overcome them and deliver new value. It’s not surprising that loyal employees generally progress into more senior roles or positions of leadership within their organizations faster than others.
Loyal employees typically demonstrate a professional and mature approach to their working relationships and avoid engaging in “office politics” or badmouthing their managers, colleagues, or the company in general.
The sense of reward and enjoyment that loyal employees derive from their work makes them less likely to “jump ship” if a more lucrative offer from a rival company is presented to them.
As we touched on earlier, in a tight labor market that’s facing unprecedented skills shortages, forward-looking businesses need to invest time and effort in building their employee value proposition if they hope to attract and retain scarce talent.
Businesses that fail to cultivate a sense of loyalty in their people will also impact their bottom line. The direct costs associated with replacing people who leave can quickly add up. This includes everything from recruitment agency fees and job advertisements to training new hires.
Building a happy and loyal workforce isn’t just something that companies that hire primarily full-time knowledge workers need to care about. Hourly workers – such as those who work in the retail, hospitality, and service industries – are currently harder than ever to find.
For decades, many hourly workers have missed out on the kinds of employee benefits and perks that their salaried counterparts enjoyed, such as paid vacation time and sick leave, retirement and health insurance benefits, opportunities for career advancement, and flexibility in terms of the hours they work. But now that they’re in equally high demand in the marketplace, employers must fundamentally rethink how they attract, reward, and retain these workers.
Organizations that intentionally build and sustain a loyal workforce start to see notable benefits for all stakeholders.
Aside from losing fewer people (such as those who go to work for a competitor or simply quit), these companies enjoy higher teamwork and internal cooperation levels. They also generate higher levels of innovation, as people are more willing to invest in their work and go the extra mile.
And the facts are there to prove it. One study by economists found that happiness led to a 12% spike in productivity, while unhappy workers proved 10% less productive. According to the research team, “Human happiness has large and positive causal effects on productivity. Positive emotions appear to invigorate human beings.”
Loyal employees are happy people and, according to Forbes, happy people translate into “hefty profits.”
It’s generally well-accepted that the prevailing employer-employee dynamic requires a few basic “must-haves”: better pay, more flexibility, and more personal fulfillment.
Following two years of trauma and disruption, another current trend is that people are first and foremost focused on their most basic needs: health, safety, and freedom from worry. Organizations that focus on these fundamental human needs will be the ones that emerge as winners in the war for talent.
Here are a few ideas for building a happier and more loyal workplace:
Rewarding people is one of the most effective ways to increase employee loyalty. But an attractive compensation package coupled with attractive perks and benefits is just one leg of the stool. Non-monetary forms of recognition are just as important. Give everyone the opportunity to make a meaningful contribution through their work and make a point of celebrating a job well done.
If you don’t acknowledge people’s efforts, there’s a good chance they’ll begin to feel “invisible” and undervalued, which could well lead to them looking elsewhere for a job.
Work with your human resources team to develop and formalize a fair and equitable employee recognition program if you don’t have one already.
Well before the pandemic hit, enlightened employers saw the merits of introducing flexibility into their workplace models. This flexibility takes the form of anything from remote working and flexible schedules to unpaid vacation days and job sharing.
For most businesses that employ hourly workers, the option of letting their employees work from home simply isn’t feasible. But there are many other ways to offer these employees a degree of flexibility. For example, allowing them to follow less rigid work schedules so they can choose to work when it suits them.
Another option is allowing employees to swap shifts. This can be particularly helpful if an unforeseen personal commitment or health issue crops up. Many hourly workers will jump at the chance to pick up additional shifts from time to time to get a little extra in their pay packet that week or month.
Digital solutions such as that offered by Payactiv allow employers to give their workers access to shift management systems. This lets them immediately see available shift openings or who they might be able to swap shifts with if they find themselves in a tight spot at short notice.
Earned Wage Access is recognized as a smart choice for businesses looking to foster employee loyalty and stand out from the competition as an employer of choice. Essentially, EWA allows employees to access the money they’ve already earned before their regular payday. It can happen in several ways; the funds can be loaded onto a debit or prepaid card, transferred to their bank account, or even picked up as cash at Walmart. The best EWA providers also allow employees to access their earned wages through a handy mobile app.
The popular EWA solution offered by Payactiv goes even further, allowing people to use their earned wages to pay for services like Uber and Amazon and pay their bills directly in the app. It also includes additional perks like discounts and special offers, handy features like budgeting and savings tools, and free bill management.
EWA is particularly relevant and valuable to lower-income, hourly-paid workers who live paycheck to paycheck.
Loyal employees are worth their weight in gold, more so now than ever in a tight labor market. If you’re looking to stop the talent exodus and build a compelling employee value proposition, focusing on building a loyal employee base is a great place to start.
Payactiv is here to help you on this employee satisfaction journey.
The Great Resignation continues unabated; currently, one in five employees says...
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