With the tumultuous events of the past year in government as well as several leading industries, trust in leadership in general is trending downward. At the same time, the uncertainties and risks in the coming year create low business confidence and seem to be leading many companies to plan for cautious growth, if not targeted layoffs or retrenchment. These larger trends, in addition to the current generation’s comfort level with changing companies regularly, mean that investments in critical talent will likely need to increase in order for companies to retain their best employees.
Salaries have long been one of the largest line items in companies’ budgets, but many employees have not felt like they are treated with that same ranking of importance. The Year of the Employee means that a greater share of company attention and investment will shift to employee rewards of all kinds, and more focus on listening to employee needs, offering growth and development opportunities, and supporting employees as a whole person.
Investing in People Means Investing in HR
Those of us that work closely with the HR community, especially with startups, have noticed that HR is gaining influence at earlier stages, as Series A companies look for Heads of Talent and Series B companies look for Chief People Officers. Not only are they putting experienced people into these roles (v. promoting inexperienced people from within), they are giving them broader scope and a real “seat at the table” in many cases. The value of professional recruiting teams and people operations programs that focus on career development, leadership coaching and creative compensation are becoming more broadly understood by executives. It helps that the continuing advancement and awareness of “people science” or HR analytics is giving new credibility to People Leaders who embrace it, and helps leaders recognize that human resources isn’t just for welcoming new hires, planning company events, managing benefits and writing performance plans. When well executed, good HR practices have a dramatic effect on retention and general morale, and this makes HR’s benefits as quantifiable as any other function.
Advancements in Salaries and Benefits
Salary competitiveness, as well as the range of company benefits, are essential ingredients in a comprehensive retention strategy. It’s likely that more companies will be subject to unscientific internal self-surveys and public releases of unfiltered compensation data, as happened at Google this year. Alongside this, more cities and states will follow the lead of California and New York and pass laws focused on gender pay equity. Actions such as these, and the efforts of some companies to get ahead of these issues, will lead to more generous (and more fairly administered) compensation practices.
Time off policies are also evolving. Many companies are embracing “Open” vacation plans, and Paid Family Leave is replacing the traditional “Maternity Leave+” policy structures. Gender and role-blind parental leave is becoming more and more common with companies and will find its way into more legislation as well, as it has very recently in NYC. The distinction between primary and secondary caregivers is becoming less distinct as “secondary” parents gain recognition, which dramatically increases the number of people eligible for these benefits.
And in the modern workplace “soft” benefits are just as important as traditional ones (insurance coverage, vacation time.). To compete, progressive companies must make sure they have spaces for employees to relax/refresh, offer regular employee touch points with leadership (through company meetings, open town halls, suggestion boxes, etc.), and options to participate in employee resource groups or mentorship opportunities. All of these perks and programs will continue to grow and to gain acceptance (or expectance) in a broader range of industries. And of course there is the strategically critical area of career development – which requires long term structural planning, robust L&D programs, versatile Business Partners, and a sustained commitment from management to the mission of advancing employees in their careers. These are quantifiable commitments to employee health and loyalty, and will require continued investments in HR.
We expect all of these benefits to continue advancing in 2018. Whatever the underlying reasons are, policies and practices that put more emphasis on employee growth and rewards, that evolve workplace cultures are a welcome trend.
Written by Charlie Gray, Gray Scalable President
This post originally appeared on hr.com