The 5 pillars of an EVP that attracts and retains top talent
Finding top talent has never been harder—or more critical. According to McKinsey, 87% of companies say they’re already experiencing a skills gap or expect to soon. And a survey of C-level executives by West Monroe Partners found that hiring and retention are the top threats to U.S. businesses.
In this labor market, you need to reconsider how you attract and retain top talent.
That starts with evaluating your employer value proposition. This guide explores the five pillars to consider as you look to differentiate your company from the competition.
Candidates and employees care about compensation, but it’s just not the only factor when making an employment decision. Research shows that compensation alone doesn’t predict employee satisfaction more than other factors.
In an increasingly tight talent market, you have to offer more than just a paycheck. You need to create a path forward for employees so they can progress in their careers and earn more over time.
Target permanently increased starting wages from $13 to $15 an hour and paid a one-time $200 recognition bonus to frontline store and distribution center workers for their efforts during the pandemic.
But they took it a step further. They also launched a reskilling program to help employees grow their careers.
2. Total rewards package
There’s a growing awareness of the importance of total rewards. “Any company can provide money—it has to be the total package,” says Tamla Oates-Forney, Chief People Officer at Waste Management. And 94% of employers surveyed by Willis Towers Watson said voluntary benefits would be an important part of their total rewards strategy over the next three years.
What exactly should your total rewards package include?
In addition to the basics like healthcare and paid time off, consider the needs of your workforce like mental health support, childcare, and educational opportunities.
According to McKinsey, the pandemic has led many companies to expand benefits to provide tools to help employees work remotely, mental health resources like counseling and enrichment, and training to help managers support employees’ well-being.
With the Your Tomorrow education and upskilling benefits program, Waste Management offers nearly 36,000 US employees access to more than 170 fully funded programs, including undergraduate and graduate degrees, short-term technology and business certificate programs, and high school completion.
And as of January 2022, the program will expand to include employees’ dependents such as children and spouses.
Chief People Officer Tamla Oates-Forney believes the program will pay for itself by reducing employee turnover and attracting top talent. Offering educational benefits for dependents can also create a natural pipeline for young people into the company. “It’s going to really be beneficial to us as a company as we compete for talent, specifically drivers and technicians,” Tamla told HR Dive.
”There is such a war for talent that compensation isn’t a differentiator.” – Tamla Oates-Forney, Chief People Officer at Waste Management, New York Times
3. Career advancement opportunities
Today’s candidates want to see a path forward and opportunities to grow.
According to Harvard Business Review, the top predictor of workplace satisfaction is the culture and values of the organization, followed closely by the quality of senior leadership and the career opportunities at the company.
With the current labor shortage, the need for advancement opportunities is only becoming more pronounced. And employers are responding.
Employer job postings for positions that do not require a four-year degree included the phrase “career advancement” 35% more from March through July 2021 than in the same span two years ago.
The term “training” appeared 32% more often, the New York Times shared in an article very tellingly titled “Workers, in Demand, Have a New Demand of Their Own: A Career Path.”
As mentioned before, Target increased wages during the pandemic but they took it a step further by offering career growth as well. All 340,000 Target employees are eligible for debt-free education made available through their partnership with Guild.
“The most innovative companies are realizing the best thing they can do to differentiate themselves as an employer is to offer economic mobility, reskilling, and the opportunity to gain more skills or move up within a company,” says Guild CEO Rachel Carlson.
4. Contribution to the world
Employees want to feel like the work they’re doing every day is making a positive contribution to the world. In fact, 9 out of 10 people are willing to earn less money in exchange for more meaningful work.
Younger generations in the workforce feel strongly about living in alignment with their values. Millennials are willing to make sacrifices for the issues they care about, including paying more, sharing products rather than buying them, or even taking a lower salary to work for a more responsible company.
According to Deloitte, “To win the hearts of Generation Z, companies and employers will need to highlight their efforts to be good global citizens. And actions speak louder than words: Companies must demonstrate their commitment to a broader set of societal challenges such as sustainability, climate change, and hunger.”
The pandemic also served as a forcing function in this respect. If your job is not fulfilling and meaningful, is it really worth risking your health and safety to show up every day? Employees have answered this question by leaving jobs in record numbers—or at least admitting that they’re planning to leave soon.
And according to Robert Half, 1 in 3 workers whose feelings toward their work have changed due to the pandemic want to pursue a more meaningful or fulfilling job.
What matters most to employees and consumers?
You won’t know unless you ask them. Engagement surveys helped Chipotle confirm that their company purpose and values were competitive differentiators for their employer brand. Reflecting on these lessons, Chipotle’s VP of Talent and Culture Tawanda Starms says, “Employees are going to want to work for organizations that can get behind a purpose and not just talk about it but actually live it.”
To learn more about how to communicate to your employees that your company stands behind social causes, join leaders from Gap Inc., Shipt, Whole Foods, and Guild to discuss how to tie the social implications of ESG into your EVP.
Creating an engaging employer value proposition isn’t just about attracting people. Any talent you bring in won’t stay if they don’t feel like they’re in a welcoming, inclusive environment.
“Our EVP starts with culture,” says Tamla Oates-Forney, Chief People Officer at Waste Management. “Someone can make a lot of money, but if they’re not happy with where they’re working, they’re not going to stick around.”
Your company culture plays a major role in employee retention: almost a third of employees quit due to company culture. And if diversity, equity, and inclusion (DE&I) is a priority at your organization, your company culture can be a huge help—or hindrance.
Chipotle Embraces a Learning-Oriented Culture
According to Harvard Business Review, companies with learning-oriented cultures tend to be more diverse and inclusive. When companies emphasize flexibility, open-mindedness, and exploration, employees from diverse backgrounds are more likely to thrive.
“I started Chipotle as a summer job. I never thought it would turn into what it did for me,” says Alyssa Riegel. Now a General Manager, Alyssa enrolled in a BA program at Brandman University through Chipotle’s partnership with Guild.
The flexibility of the online program has allowed Alyssa to continue working and study at her own pace.
And she’s convinced that this type of opportunity is only available because of Chipotle’s growth-oriented culture.
“I think it says a lot about Chipotle as a company that they’re willing to invest in their people because cultivating a better world doesn’t just mean food and the food industry. It also means cultivating people and they truly do do that,” says Alyssa.
Employers looking to compete in the war for talent need to adapt to the changing expectations of employees in a post-pandemic world. Looking to improve your talent strategy in 2022? Check out our top strategies to help you win the war for talent or sign up for our upcoming webinar Owning Your “S”: Tie the Social Implications of ESG Into Your Value Proposition.