In politics, the axiom “It’s the Economy Stupid” may hold sway, but not so in the domains of HR, talent management and compensation. In today's competitive business landscape, the economy is often seen as the most critical factor in a company's success. However, companies that focus solely on economic trends may be missing out on the most critical component of their success: their employees. Hiring and retaining top talent can be a game-changer for any business, regardless of economic conditions.
Attracting and retaining top talent can improve a company's performance and profitability. Top talent tends to be more productive, creative, and innovative, leading to higher-quality products and services. This increased quality, in turn, can lead to higher profits and growth for any company.
Also, having a team of top-performing employees can give a company a competitive edge. In today's fast-paced business world, companies need to stay ahead of the competition to succeed. Hiring and retaining top talent can provide a company with a competitive advantage that can help them stand out in the market.
Employees are a critical part of a company's brand and reputation. A company with a reputation for treating its employees well is more likely to attract and retain top talent. This reputation can also attract customers who want to support companies that value their employees.
Investing in employees can have long-term benefits for a company, regardless of economic conditions. While economic trends can change rapidly, the skills and expertise of employees with proper training and upskilling can last a lifetime. That investment in employee development and training can help a company build a strong team that can weather economic downturns and emerge stronger on the other side.
Not investing in employees carries its own set of perils and costs. When you must go out to the market to replace a quality employee, it’s not only the hard cost of recruiting and onboarding you need to worry about. Soft costs can often dwarf the hard costs. That position may remain vacant for some time. When you do hire a new employee, it takes time for that employee to get up to speed. The more complex the role, the longer it takes. While the position is vacant and while that ramp up is happening, customer service is diminished, the number and severity of errors go up, and your other employees get stressed out covering and training the new hires, increasing the likelihood of additional turnover. You get the drift.
By reacting in a knee-jerk manner to potential economic downturns and laying off employees you value to create a more attractive P&L, you are sacrificing known assets that secure your future for some spreadsheet-inspired benefit that will likely evaporate in short order. Even laying off employees that may not be top notch but are reliable producers can put your company in jeopardy. We are in a period of prolonged labor shortages. As we peer out of the far side of this economic ripple, we’ll see the labor market heat up and be right back in this war for talent, that frankly, we haven’t escaped from yet. Trading in even qualified talent now, may come back to bite you in a future where a tight labor market will be with us for the foreseeable future.
At the foundation of these decisions is understanding the work people do at a granular level. With that understanding in hand, you can effectively recruit, evaluate and retain talent. It all starts with accurate and up-to-date job descriptions. Just sayin’….
Written by Don Berman - Co-Founder, VP, Sales & Chief Evangelist. Throughout his career, Don Berman has been a driving force in the world of HR and talent management technology, collaborating with both domestic and international companies to empower them with innovative solutions. As the co-founder and business development lead of JDXpert, Don was instrumental in the company’s pivot towards a job description-centric model, which has helped establish JDXpert as a market leader in job description management solutions. Currently leading the company’s sales, thought leadership, and partnership initiatives, Don’s unparalleled expertise and guidance are instrumental in shaping JDXpert’s direction and driving its continued growth.