Australia is experiencing employment boom and skills shortage as a result of tighter immigration rules and recovery from the recent global recession. More than that, Australia’s unemployment rate is now 5 per cent, its lowest point in two years. Top that with rising bank interest rates, rising living cost, rising food prices, your employees might be demanding a wage rise this year. So, how to retain your employee during skills shortage?
“Exit” bonuses – For companies looking to be brought out in the future, this is a great way to retain your employees. You may provide all your employees with options that convert to shares when the company is sold or when the ownership changes. So employees who stick around will end up owning equity, whereas employees who exit early get nothing.
Know the market value of your employees – Are you underpaying or overpaying your employees? Start utilising external consultants or internal source to estimate the market value of each staff. That way you will have an idea of what to do when your employees ask for a pay rise or if they are being headhunted.
Plan – Planning is crucial in all aspects of business, including human resource management. Make sure your business has policies and procedures entailing job performance and pay rise. It can be an annually or bi-annually job performance review, or even just a system for dealing with employees that threaten to leave or demand a pay rise.
By having an effective plan and system for facing labour shortage, employees will not have excuse to complain to their peer. You and your managers will have time to focus on the bigger picture of your business rather than spending time dealing with employees with other job offers and pay rise demands.