7 Employee Retention Tips in a Recession
Recessions can be tough times for businesses and their teams, causing financial strain on companies and worries about job security for employees.
During a recession, employee retention is of utmost importance to keep your team functioning and motivated — not only so you have the experience needed to continue achieving within this turbulent economic climate, but also to reduce recruiting costs once things stabilize.
So if you're wondering how best to retain your staff during uncertain economic circumstances, the 7 retention strategies below are just what you need!
1. Check if You’re Eligible for ERC
Let's start off with something every business owner should know about an Employee Retention Tax Credit (ERC). The ERC is a federal tax credit that provides reimbursement of up to 70% of wages paid between March 13, 2020, and December 31, 2021. This could be extremely beneficial for those who have kept their employees on board during the pandemic.
To qualify, an employer must meet certain criteria set by the IRS. Employers must have experienced a 20% decline in gross receipts compared to the same quarter of the prior year. Additionally, employers must not be federal, state, or local government entities (including public schools and universities).
An ERC is an excellent way to start your employee retention strategy because the more money you have as a business, the more you can invest in your employees’ well-being and security. This could come in the form of better wages, additional benefits, or even training programs.
2. Celebrate Achievements, Big or Small
Showcasing milestones and achievements, big or small, is essential for maintaining employee morale during difficult times. Acknowledging your employees’ hard work allows them to feel valued, recognized, and—most importantly—like all their hard work was actually worth it.
Celebrating these victories together creates a sense of unity and shared purpose within the team, which can help drive retention during a recession. It also reinforces the idea that everyone is in it together as one team, which helps your staff stay motivated by each other’s successes.
Setting up an employee milestone program is also a great way to reward and recognize employees for their efforts. You can provide personalized rewards like extra days off or bonus vacation time for meeting certain goals or have employees nominate one another for special awards and recognition.
When you take the time to celebrate each other's achievements, whether through a cost-effective team retreat, fun team outing or an engaging virtual event, you can create an atmosphere of positivity that will encourage your employees to stick around for the long haul.
3. Be Transparent About Finances
Your team deserves to know the truth about the business’s financial situation. A recession can be a scary time, and if your employees are aware of what's going on, they can help contribute to solutions and make sure everyone is working together to keep the company healthy.
Not only that, involving your employees in the cost savings process allows them to feel like a valuable part of the team and builds trust and transparency. This sense of camaraderie will create a more unified and engaged workforce, resulting in increased productivity and better performance.
To make things fun, consider incentivizing certain cost savings goals with non-monetary perks like gift cards or extra time off. Not only will this motivate your team to find creative solutions, but it will also help boost morale and keep them engaged in the process. Recessions don’t last forever. By making sure everyone is informed about the financial situation and doing their part to help improve it, your business will be ready to take advantage of the recovery when it comes.
It’s never easy talking about money but having an open and honest conversation with your team will make all the difference in staying out of the red and keeping everyone motivated during hard times.
4. Engage Remote Employees
They don't call remote work "remote" for nothing! It can be difficult to stay in touch with employees when everyone is scattered across different locations and time zones. However, staying connected with remote staff is an essential component of having a successful team. Here are some great ideas you can implement:
Host virtual team-building events: These could be anything from hosting a cocktail or cookie making class to an art or yoga class. These activities help build relationships amongst the staff, create a sense of community, and provide a fun and stress-free environment for employees to interact.
Create a recognition program: This could include a recognition email to an employee on their birthday or anniversary, sending a thank you card for a job well done, or even awarding a certificate for completing a project. By recognizing and celebrating accomplishments, remote employees will feel appreciated and valued, which can lead to increased job satisfaction and engagement.
Conduct regular check-ins: Set up a regular check-in schedule with your remote staff to make sure everyone is on the same page and that communication lines are open. Having weekly or bi-weekly one-on-one meetings with each staff member will help strengthen relationships and ensure that everyone is getting the support they need.
Remote work is all about trust and flexibility. As a business owner or manager, it's important to create policies and procedures that ensure remote employees understand expectations and feel supported, no matter where they are!
5. Start a Coaching Program
When it comes down to it, all your employees want is to feel valued and secure at work. During a recession, it is often the case that employees feel their job security slipping away. That’s why launching a coaching program for your staff can help retain workers and improve morale.
A coaching program can give your employees increased confidence in their abilities through professional development. This in turn leads to better performance, which helps build trust between employer and employee. Coaching can help workers stay productive during times of uncertainty, giving them the tools to succeed in their roles.
Whether you decide to hire an external coach or to have someone internally facilitate a coaching program, it is important that your employees feel involved, heard, and supported throughout this process. Setting clear expectations from the outset will ensure everyone understands their roles in the program and how they can gain from it.
On top of this, providing regular feedback on your employee’s progress is key to the success of a coaching program, as it helps them recognize areas of improvement and motivates them to strive towards their goals.
6. Gather Feedback & Implement It
You're never going to know what your employees are thinking/feeling until you ask them. And during a recession, it's critical to keep your team engaged and loyal. Asking employees what they need is key for creating an environment that encourages retention and job satisfaction.
Once you gather employee feedback, don't just let it sit there lookin' pretty! Take action to show that you value and respect their input. This could mean implementing new processes, creating training opportunities, or investing in employee development initiatives. Showing your employees that you're listening and taking steps to improve their lives can go a long way in building trust and morale.
It's also important to stay flexible and open-minded during a recession. Don't be afraid to try something new or explore unconventional solutions. It may even be necessary to review and adjust existing policies or procedures, in order to remain competitive and make sure your business is running smoothly.
7. Activate Stress Management Strategies
Have you seen the world out there lately? It's a lot! So stress is a given already, but toss in recovering from a pandemic, a shaky economy, and workplace instability into the mix and it's no surprise that 58% of employees feel their job is the main source of stress and anxiety in their lives.
It's up to leaders like us to help our employees get through this tough time and create an environment that prioritizes self-care and stress management. To do so, you can encourage your employees to:
Healthy Habits: Inspire healthy habits like drinking plenty of water, eating nutritious meals and snacks, and getting enough sleep. These are all essential for maintaining good mental and physical health. By implementing these stress management strategies, you can help your employees stay productive, healthy, and happy.
Take Breaks: Encourage your employees to take regular breaks throughout the day. This could involve taking a walk or getting up from their desk and stretching. A break may also be in the form of unplugging for an hour or so by putting away their phone, laptop, and other distractions, allowing them to focus on themselves.
Mindfulness Exercises: Start your daily team huddle with a moment of mindfulness. This could be anything from a breathing exercise or guided meditation to meditation or yoga. Regularly practicing mindfulness can help employees feel more focused and calm.
When your team feels like they are in good hands, you create a work culture of stability and resilience that will help them stay happy and motivated.
We’re All In This Together
Companies are whispering (ok, maybe shouting) the word "recession" like a bad omen, but that doesn't your business has to make mass layoffs or take drastic cost-cutting measures that'll be too hard to recover from.
A recession can actually be an opportunity to increase efficiency and productivity and even improve morale if you're willing to think outside the box and make smart decisions. And implementing an employee retention strategy is certainly one of them.
From being transparent about the current state of the company to encouraging stress-management exercises, your company can come out of the recession stronger and better than ever before.
The key is to focus on your people. And what better way is there to show them your appreciation than sticking around during the hard times than by hosting a corporate event?
At Happied, we specialize in helping companies reimagine their staff outings with fun and engaging activities that allow teams to relax, socialize, and have fun!
