Employee loyalty is as valuable and sought after as skills and experience. Reliable, dependable, tried and tested, no executive can deny the depth of appreciation held for loyal employees.
There, through thick and thin, loyalty is a soft skill set; truffle-like in its rare and exquisite desirability and equally as difficult to find.
Employee loyalty is great for business. It creates economic value, a competitive edge, and has a significant positive and sometimes sizable impact on financial performance and operational excellence. It is no wonder business leaders so ardently pursue it.
Is loyalty great for employees?
Financially, our employees may be better off not being so loyal. Recent job switchers in the United States were paid 7.6 percent more than a year earlier – compared to the increase of just 5.6 percent for job stickers. Australia has a similar story.
Pre-pandemic figures show a causal correlation between higher rates of job hopping and faster wage growth. And post-pandemic, with the labor market shifts and the Great Resignation, we know well the value of employees who stay.
Post-pandemic, with the labor market shifts and the Great Resignation, we know well the value of employees who stay.
Loyalty, viewed through the prism of reciprocal expectations, holds a virtuous status.
Based on equal relationships, reciprocity is almost an automatic reaction, a moral imperative founded on social expectations that good deeds should be repaid. But that is outside of work.
It is elusive. We label it employee loyalty, but really what we seek is tenure, commitment and engagement. As for loyalty bonuses, it is a guise. Instead, call them what they are, retention bonuses. If they were based on loyalty, you wouldn’t have to pay for it.
So, is it fair to expect employee loyalty when we can’t deliver it back?
Let’s face it. The employer–employee relationship is transactional. When cost-cutting comes into play, even with sentimentality, affection and attachment, loyalty to employees is rarely on the balance sheet.
Instead, how can leaders foster a culture to promote tenure and engagement and, if we are lucky, capture the gift of employee loyalty?
Know your workforce
At the end of 2021, the rate of resignations in the United States was the highest in 21 years.
Generationally though, only 18 percent of baby boomers and 22 percent of gen X changed jobs. Millennials led the way, with a whopping 52 percent resigning. What is the makeup of your workforce, now and in the future?
Out-of-date strategies won’t cut it.
Pain points and trust
Your employees are combatting stratospheric costs of living. The global inflation rate peaked at 8.8 percent in 2022, and the International Monetary Fund forecasts 6.6 percent for 2023. Compared to pre-pandemic times of 3.51 percent in 2019, it is a marked difference.
The decision to change jobs may be more of a necessity than anything else.
Have an understanding culture demonstrated behaviorally through open discussions on such serious pain points. Joint problem-solving and brainstorming innovative ways to combat some of these issues create engagement and a feeling of being in it together.
If you want loyalty, trust is the titanium link.
Be transparent about what you can and cannot deliver. It builds trust. If you want loyalty, trust is the titanium link.
In today’s working world, we are all upskilling and reskilling our employees. Provide a supportive environment of understanding and patience. Mistakes are a necessary part of learning. Make them OK. It further strengthens relationship bonds.
The good news, learning environments keep people. Even better, companies that excel at internal mobility retain employees for an average of 5.4 years.
The role of a leader
Your role differs from pre-pandemic times. Leaders are now more involved in supporting their employees’ vision of their life’s meaning and purpose.
To be a successful promoter of your evolving employee needs requires leadership skills to care, nurture, mentor and inspire.
To do so, know your employees really well. Those casual catch-ups or coffees promised, which are sometimes missed, make a big difference. Make them your priority, not a peripheral fill-in. They are valuable times to connect.
Alumni strategy
We can never totally combat resignations. Nor, as leaders, can we ever negate making those difficult calls on cost-cutting and redundancies.
We can, however, make the exit in either situation as good an experience as possible.
When global research shows more than 40 percent of employees who changed jobs in 2022 felt they were better off in their previous job, it’s a no-brainer to make it oh-so-easy for your valued ex-employees to return.
