What’s in the Numbers?
Most of the time when I see the monthly jobs reports on the news, I don’t pay a lot of attention. Unless I was looking for a job, I really never gave much thought to how those numbers impact me. Times have changed for me though, and for some reason the May Jobs Report caught my attention. As I was examining the statistics, it occurred to me how this impacts business owners, and B2B businesses. It’s more than just a bunch of stats. The statistics represent actual trends in the job market, and this information can be used to plan hiring and employee development strategies. Here are a few insights I gathered from the report and some advice I shared with the Chamber of Commerce.
Just the Facts
To talk about the impact of the Jobs Report, I have to get into the data. According to the United States Department of Labor, Bureau of Labor Statistics, here’s what the May Jobs Report tells us:
- 92 straight weeks of job growth
- Unemployment at 18 year low of 3.8%
- The highest number of new jobs created in 2 decades at 223,000
- Companies are having difficulty finding highly skilled workers
- Salaries are increasing
These numbers suggest that employees, especially highly skilled workers, are in demand and this gives them more options. Workers can be lured to another company by higher salaries, better working conditions, or better benefits. Companies that have to hire skilled workers are likely to see an increase in salary base, which impacts the bottom line. The higher costs of salaries can result in lower profit margins, or higher costs of goods and services.
What are you doing to keep your employees loyal to you instead of going to your competitor to earn more money?
What are you doing to keep your customers loyal in the face of rising costs?
Thinking about these questions caused me to immediately remember a seminar I attended about the Ritz Carlton way. The Ritz Carlton serves the top 1% of travelers. Their guests are paying top dollar and they expect the best. Year after year, the Ritz Carlton is able to live up to the expectations of their patrons. How do they do that? When it comes down to it, it is just a hotel. Sure, they might have more excellent amenities, but the features don’t create loyal guests. It all comes down to the people. If you want to have world-class results, you have to employ and develop world-class people. The Ritz Carlton has a focus on leadership and engagement which results in low turnover and high customer loyalty!
Replacing employees is an expensive proposition. In a study conducted by the Center for America Progress, the cost of losing an employee can cost anywhere from 16% of their salary for hourly to 213% of the salary for a highly trained position! To keep your employees happy, and loyal to your company, you have to create an engaged and motivated workforce. Many business owners understand the need for attracting talent. They’ll tell me that they have “feelers” out for new prospects. When you think about it, if you have “feelers” out, can’t you expect your competition to do the same? And if you’re targeting their employees, aren’t they targeting yours? The bottom line is to keep your employees happy you have to have them engaged. Your employees need to have a reason to work for you and not your competitor. If they are working for you solely for the money, well when the competition offers more money, they’re going to leave.
Some of the best companies in the world, including the Ritz Carlton, put their employees first. It sounds backward right? Isn’t the customer or client the first priority? Not if you want to have the best customer service and loyal clients. Statistics show that happy employees create happy clients. Have you ever heard the old cold calling advice to smile when you dial? When your employees are happy, they are more likely to go the extra mile for your customer. They’ll be more inclined to listen to your clients’ problems and concerns. Most importantly they’ll be more inclined to help you find solutions to those problems and concerns. This makes you and your company a trusted resource, which creates loyal employees. Oh, one more thing…it’s generally costlier to acquire new customers than it is to keep your present customers happy.
This Week’s Challenge
What are you doing to keep your employees from going to your competitor for more money? What are you doing to keep your customers loyal in the face of rising costs? Begin to look at your company’s employee engagement and take a serious examination of your own engagement process. Decide to compete on value, rather than cost. Provide world class service to your team and your customers, and watch your results rise to the top.
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Quote of the Week
“When leaders throughout an organization take an active, genuine interest in the people they manage, when they invest real time to understand employees at a fundamental level, they create a climate for greater morale, loyalty, and, yes, growth.”
– Patrick Lencioni, Thought Leader, Business Management