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Expert: Retaining employees is key as economy improves

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Peter Hutton, resident managing director in Morristown for Aon, the insurance and benefits firm, said employers now face a challenge to attract and retain talent as the economy recovers and the job market heats up.

Peter Hutton

"Companies have to be more and more diligent to identify where the talent is and how to retain it," Hutton said.

Hutton said much of the issue comes back to the financial crisis of 2008.

"Many mature workers sort of gave up, so we have many workers that have actually left the marketplace and may not come back as the uptick occurs," he said. "So the first struggle is how are companies going to identify and actually find candidates."

Hutton said many companies recruit workers who are already employed, creating difficulty.

"How are they going to pull them away and show them why it may be time to look at something better?" he said.

Companies need to consider providing training to retain talent, but Hutton said some employers refuse to train workers who might pick up and leave.

"But if you don't train them and they stay, then what?" he said.

To retain workers, companies "need to offer a career path, then use training to keep the talent and continue to home-grow it."

Hutton said health care, technology, real estate and retail are among the sectors hiring.

"This will create opportunity for those that are unemployed that haven't been able to find jobs, especially in that white-collar service provider sector," he said.

And the increase in retail jobs "will be good for our younger workforce as well as the older population."

To find talent, companies are using staffing firms, their own internal recruiting departments and luring workers away from the competition.

What Hutton hasn't seen is a widespread movement of workers as the job market has improved. He said observers had been predicting that as the job market came back, "there was going to be this magical moment in time where there may be an exodus of employees leaving for greener pastures, and we really haven't seen that happen to any extent."

However, he said companies will have trouble retaining workers "if they are not really showing a true career path in position, title and income. Those companies are going to suffer, and they will lose some people either to their competition or to another industry."

Hutton said employers need to offer competitive compensation and look at the entire compensation packaging, including benefits.

"Companies have to do a much better job of identifying for employees: what is your total compensation, and it is not necessarily just the paycheck," he said.

Hutton said benefits are the "hidden paycheck," and many companies are now informing their employees, every six months or annually, what that total compensation is.

Employers can also retain talent by providing "a mentor who can influence their career path."

And employees may decide to stay or leave based on the stability and future prospect of the company. "Do I think my company is a potential takeover (target) and would I rather be with a bigger fish or a smaller fish?"

He said the "stronger, better companies" know how to identify ways to reach their people and "show them a road map" to get ahead.

 
 

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Beth Fitzgerald

Beth Fitzgerald

Beth Fitzgerald reports on health care, small business and higher education. She joined NJBIZ in 2008 after a 34-year career at the Star-Ledger and has been reporting on business in New Jersey since 1978. Her email is beth@njbiz.com and she is @bethfitzgerald8 on Twitter.

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