February 9, 2022Continuous Improvement
Navigating Labor Shortages & Turnover
If you’ve found yourself having to manage a higher turnover rate than usual, you’re not alone. Over the past year, companies of all sizes across industries have experienced wave after wave of resignations as workers contemplate post-pandemic priorities. Experts are calling it the ‘Great Resignation’. According to the US Bureau of Labor Statistics, 4.5 million people voluntarily left their jobs in November of 2021, a record-high. Since April of 2021, the Bureau reports that nearly 33 million Americans have moved on to new opportunities.
Losing the talent and company knowledge of any employee on short notice causes a hiccup internally. But what happens when it’s an employee that is integral to your company’s success or business continuity? While it may not be possible to prevent high turnover in the current job market, there are things that you can do to prepare your business for potential attrition. We sat down with Ana Woods-Hill, CPP and Manager of Payroll Services here at Wise Consulting, to learn how Wise has been providing additional support during this historic tumult.
Short Staffed, Long Impacts
Most employees don’t make the decision to leave their company lightly. And while the precursors to a resignation that move an employee to flight risk status may take months, their departure often happens all too quickly. “It takes someone two weeks to walk out the door and it probably takes two years to bring someone [new] up to speed,” points out Woods-Hill. This imbalance in process-length has left many companies in the lurch, pumping increasing time and money into recruitment, onboarding and development while looking for ways to entice current talent to stay.
Being without an employee for any length of time impacts your business, but long-term shortages can be especially harmful. The longer the shortage, the more ground a new hire will have to make up. In addition, the necessity of other team members having to jump in to cover the departed employee’s responsibilities can lead to a decline in morale and increased flight risk, explains Woods-Hill. “Someone can deal with covering another workload for a month, but once it gets to two, three, six months, that starts to not bode well for other employees.”
The result? Loyal employees become overworked and burned out, potentially causing them to make decisions about their employment they may not have considered prior to their job duties expanding. “Even though it wasn’t necessarily the fault of the company that those positions ended up needing to be filled or people were leaving, just with what we’re dealing with from an economic perspective, it can start to feel like it’s the company that did that to them,” says Woods-Hill. The cycle repeats itself.
Process Documentation is the Best Medicine
While all this talk about inevitable turnover could raise concern in any company leader, there are things that can be done to help businesses navigate the Great Resignation. Woods-Hill notes that one of the smartest preventive measures you can take to prepare for fast recovery from employee loss is documentation of all processes. “You can’t bank on anyone to stay. No one is for sure right now so every single process really does need to be documented so you can ensure you mitigate the cost for re-work, re-training, and re-hiring down to a minimum.”
She notes that no process is too small or too large to document, whether it be how your newest hire operates or how your president manages his workload. In today’s job market, no position is immune to vacancy. And, while documentation may feel like a taxing investment of time, it’s one worth making. “A recent example I’ve seen of this is in unexpected turnover for a client,” reports Woods-Hill. “As we stepped in to support them temporarily and navigate on an emergency basis, it became clear that many processes were not internally documented. Insult to injury occurred when this turned into a permanent employee loss for the client and they had to pay for staff augmenting support and new documentation as they searched to replace the role in the market. They paid the price, very directly, by not having documented the roles and processes run by people they thought would stay.”
Maintaining up-to-date documentation ensures the ability to pick up where the departing employee left off, and can be crucial for HR and payroll processes that are vital to business continuity. Failure to do so can leave your team spending hours scratching their heads, performing research to recreate undocumented checklists and trying to figure out what to do next.
Unfortunately, Woods-Hill sees documentation assistance as an underutilized service that many clients don’t realize they need until it’s too late. She’s advocating to change this, and has urged clients to build the time and cost of accurate documentation into their budgets. In some cases, knowing there are certified, seasoned payroll consultants who can come in and do this – suggesting improvements and spotting potential compliance risks in the process – is a game-changer. “There’s always going to be a reason to prepare for things to not go to plan, so it’s really important to address that in advance of catastrophe,” says Woods-Hill.
Looking for the Silver Lining
While there’s no denying that staffing shortages and high turnover rates are frustrating, debilitating and expensive, Wise payroll consultants have encouraged several clients to make internal improvements in reaction to this challenge. Woods-Hill explains that the current workplace shift, though frustrating, may actually be the best window of opportunity in which to conduct a system or payroll process review. “It’s important to have documentation maintained, but we try to find the value of utilizing new perspectives,” she explains. Wise Consultants have worked with clients to examine how current systems or processes can be improved, and green hires can be seen as another hidden opportunity because they do not have preconceived ideas or outdated checklists they are dragging in from previous roles. They can be trained to get things right and develop ideal habits from the start. Sadly, even for experienced teams, good intentions to review and document processes often get kicked down the road until the company loses a key player and realizes, “For five years, we’ve been talking about examining this process. Now, no one here has ever done it, so it’s the right time to learn and make improvements as we finally tackle it ,” says Woods-Hill.
What About Wise?
With all this mention of resignations and short-staffing, we can disclose that Wise Consulting has not been entirely immune to this phenomenon. However, our normal practice of building in resource redundancies and back-ups to enable continuity of service to our clients is helping us weather the storm. “The way that we set up our model to provide an additional support beam is that we have both a primary and secondary-support for each client based on the account size. We also have a floating role for each consultant to fill in an emergency that provides additional, cross-trained coverage should there be an unexpected outage,” explains Wood-Hill. “We have a back-up for our back-up.”
This resilient structure has allowed us to continue to provide our clients with unwavering support throughout the past year and a half. We continually strive to learn and make improvements, as we have with other aspects of the pandemic – such as forming our COVID Task Force to stay current on changing legislation impacting payroll – and that has helped keep the ship steady. When many clients are in the eye of the storm and needing access to our expertise the most, we are honored to be the reliable support they turn to.
Navigating Turnover? Contact a Wise Consultant!
We understand just how challenging the past two years may have been for your organization and your team. Navigating periods of high turnover and staffing shortages can be extremely draining, but you’re not alone. Our team of expert consultants at Wise understand how an employee departing can have a ripple effect on your business, and we’re here to step in where you need it. Whether you are seeking temporary payroll support, implementing new HCM software or want to invest in process review and documentation, our team can lend a hand. To learn more, contact a consultant today!
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