American workers are resigning in droves. What has been dubbed “The Great Resignation” is much more likely a “Great Reshuffle” as workers are not exiting the workforce but seeking something more fulfilling as the demand for their help surges.
The U.S. Department of Labor latest jobs report shows that the U.S. job market now has two job openings for every person unemployed. With so many opportunities available and inflation at peak levels, your key talent might be exploring other options. The question is, what are you going to do about it?
To address this “new normal,” it’s important to understand what’s driving it and how business leaders should respond to these changes.
Lockdowns brought an abrupt halt to the perpetual motion most American workers operate in and that pause caused some self-reflection. Many workers began comparing their pre-pandemic routines to newly uncovered measures of fulfillment, like work-life balance, scheduling autonomy and the daily commute. This reset in priorities has shifted mindsets and that can’t be undone.
The consequence is that American workers have a renewed sense of purpose around their work and what their workday should look like. Tenure, salary and other traditional benefits are being displaced by the promise of what could be—whether practical or not. This means more change is on the horizon.
As workers’ priorities shift, business owners need to perform some self-reflection of their own, challenging how their cultures, job responsibilities and other operational needs can be adapted to meet this new trend.
There are several factors that are driving wages higher. First, the unemployment rate is historically low (just 3.6%), but demand for workers is significantly high.
Second, inflation is affecting workers at home and at the office. American workers are seeking more money to keep gas in their fuel tanks and groceries in their pantry. This, all while supply chain shortages and price increases are affecting the projects they manage, putting budgeted profit margin at risk.
Lastly, the pursuit of talent is broadening beyond the flooring industry, and those businesses might be willing to spend more than you traditionally would. Workers with deep ties to the industry are recognizing this and considering options that may challenge their abilities but afford them a better quality of life.
In a low-margin industry like flooring, it’s important to assess the value that each staff member brings the business, both directly and indirectly.
- What key tasks or initiatives is that staff member responsible for?
- How does their involvement impact top-line growth and bottom-line profitability?
- What knowledge does that staff member possess that others rely upon or benefit from?
- If we lost him or her, what ripple effects might that create?
While affordability is operationally dependent, these questions can frame a team member’s value, helping you answer the question: Am I willing to lose this person to a competitive labor market?
Most of the time when we think about value propositions, we think about the customer-facing exchange of goods and services, but as flooring contractors strive to retain staff while seeking new talent, what are you offering that others can’t?
Knowing what you have—your secret sauce—and what you are willing to offer is paramount as you assess a team member’s value. What worked before may not work in this competitive environment and, thus, it’s best to approach the priorities and compensation needs of each staff member at an individual level, assessing how your business best aligns with your mutual goals for success.
The competitive market is desperate for experience and, thus, those considering retirement may be willing to extend their plans in order to capitalize on the knowledge and deep-seeded relationships that few others can offer.
For businesses reliant on those ties, it’s critical to plan around succession, leadership and professional development and the transfer of industry knowledge and relationships to preserve long-standing success.
Are you challenging and supporting your senior staff to pursue that end?
While we can’t predict how this Great Reshuffle will play out, we must understand that it is happening in every industry, including our service providers and customers. This will affect relationships with vendors, end users and our clients in profound ways. Those people are paramount to how we do business and, as they reshuffle their roles, their priorities will too. Disruption will follow. How will you prepare for and embrace that change?
Change is upon us. New cards are being shuffled and about to be dealt. Are you ready?
Grant Petruzzelli is president of Universal Metro, a Santa Fe Springs, Calif.-based commercial flooring contractor. As third-generation contractor and industry thought leader, he is focused on encouraging the next generation of sales and organizational leadership. Petruzzelli is actively involved in Starnet, where he serves on the advisory council and co-chair of the business development and specifier committee.