Employee loyalty is more important than ever. The current labor market is considered uncomfortably tight - a situation that creates an excess need for workers. This makes it difficult to hire for open positions and makes it increasingly expensive to lose valued employees.
Employers should follow these three steps to improve employee loyalty.
1. Be invested in your employees
Employees are asking for a helping hand when it comes to covering essential expenses - in MetLife’s 10th annual study of employee trends, 40% of employees say they want help in achieving financial security. And as a result, a popular trend for new employee benefits in 2017 is the shared responsibility of employees’ financial wellness.
How widespread is the issue?
It turns out financial insecurity knows no age limits. In a PricewaterCoopers employee wellness survey, they found that of the employees who find it most difficult to meet their household expenses on time each month, Gen Xers are the highest generation at 50% of all employees. 41% of millennials claim it is difficult for them to meet their financial expenses each month.
The same study shows that 54% of millennials are more likely to say that their loyalty to their company is influenced by how much the company cares about their financial well-being.
Employers who invest in their employees create an indispensable relationship. Employees are able to achieve their future financial goals and feel secure in their careers, while employees reap the benefits of employee loyalty.
There are a variety of ways you can show you are invested in your employees and their financial wellness: financial education opportunities, employee loans, and daily payment are a few options.
If you are invested in your employees, you have begun your company’s path toward improved company culture.
2. Improve company culture
Culture in the workplace is the next step to increasing employee loyalty. Culture seems to be more of a buzzword than anything and it usually seems isolated to particular industries or start-up companies, however, the fact of the matter is culture exists in every organization, whether it is by design or by default. Improving company culture can go a long way with your employees.
The benefits of an improved work culture abound:
- Increased employee engagement
- Increased productivity
- Improved recruitment process
- Aligns an employee's goals with an employer’s goals
A strong culture isn't just about fun and games and wacky perks. Employees want to be proud of the organization they work for. According to HBR, employees may be asking themselves two very basic questions when it comes to gauging the culture and enthusiasm within the workplace. Are people treated well economically and interpersonally? And is the work itself fulfilling and enjoyable?
While it is more difficult for an employer to help an employee find their work fulfilling, treating employees well economically and interpersonally is well within their abilities. The better your company’s culture, the more engaged your employees will naturally be.
3. Show your employees that you care
Corporate Social Responsibility (CSR) is one way to show your employees that you care about the causes they care about. Programs such as donation matching, volunteer outings, and even product donations that your employees choose have shown to be beneficial to improve employee morale and improve your employees' loyalty to your company.
CSR software company YourCause reports that engaging employees in CSR programs can reduce turnover by up to 50%. They have also reported similar statistics such as 75% of millenials are willing to take a paycut to work for a company that are "socially responsible."
CSR programs aren't a waste of time, either. YourCause reports that 34% of employees participate in giving programs at companies with CSR programs and 18% end up volunteering for causes through the programs.
By showing your employees that you care, their loyalty to your company will increase as they become more and more involved in programs such as these.
4. Improve employee engagement
According to a recent study conducted by Deloitte, culture and engagement are the most important issues companies face around the world. 87% of organizations cite culture and engagement as one of their top challenges, and 50% call the problem “very important.” The Harvard Business Review shows that not only do highly engaged organizations have double the rate of success of lower engaged organizations, higher engaged organizations also have lower absenteeism and turnover.
We recently put this theory to the test. We recently tested a group of rideshare drivers in San Francisco to see how offering daily pay services would improve engagement and attendance. The results were staggering. The number of people who drove at least once during the test period was 26% higher than the control group, proving that employee engagement can be improved through certain types of employer perks. But even more impressive, the individuals in the test group increased their productivity by 51%.
This industry isn’t the only one to thrive with a daily pay system in place. We’ve also tested manufacturing, tutoring, and more. The results, across the board, are uplifting. The more you invest in your employees, the better the culture will be. With a strong culture, your employees will be more engaged. The equation is simple - these components combined are what create employee loyalty.
Check out our cost savings calculator to see how much your company could save in preventing turnover costs by improving employee loyalty.
Recommended reading >> The 7 Intuitive Laws of Employee Loyalty