Retain Star Employees in Shifting Market
In today’s candidate-hot market, construction companies face many challenges when it comes to retaining talented employees. One of the most critical is keeping your star employees grounded in the reality of shifting market conditions. We are seeing increasing numbers of candidates consider making a jump for more money – the offers are rolling in for in-demand candidates, and the economic conditions are favorable enough for companies to offer them premium packages. However, this is not a sustainable market condition – the market will correct itself, and when it does, companies might implement “last in, first out” policies that could leave eager new employees in the dust.
Consider the following situation: The workload at your company has increased beyond the current team’s capability, and you need to hire a second Project Manager to help carry the weight. The candidates who meet your experience requirements are commanding $140K salaries, but your current Project Manager, who is a high performer and has been with your company for several years, earns $120K, which is more in line with true market value for the position. How can you keep your current Project Manager content with his or her compensation while still bringing in the new talent your company needs to meet the demands of your clients?
Before your employees express frustration about pay raises that don’t seem in line with the boom in the economy, or which don’t match competing offers they’ve received from other construction firms, we believe that the best course of action is to be proactive and educate them. Talk about the long-term strategy behind compensation decisions within your company and the risks of making the leap to a new company just because the market is hot today. Let employees know that company loyalty increases job security, and emphasize the true value they bring to your company. With open communication, you can increase confidence in the direction of the company and help ease the natural tendency to wonder if there’s something better out there.
Candidates Inflate Salaries
Another important factor to remind candidates about is that if they’re collecting market value information from colleagues or peers in the industry, they must take the information with a grain of salt. Many candidates inflate their current salaries in order to secure higher-paying jobs if they’re on the hunt, or to present themselves as particularly valuable to companies if they’re seeking to build a reputation. Everyone’s motivations for sharing salary information are different, and there’s no guarantee that the information they’re sharing is accurate.
Proactive Market Education
Candidates have more options than ever in today’s construction market. The best way to keep your employees satisfied and prevent turnover is through clear and proactive education about the realities of market dynamics, the value each employee brings to your company, and the benefits of long-term thinking when it comes to making big career choices.