The fourth business quarter of 2018 marks the ten-year anniversary of some of the more notable events of the Great Recession, including record drops in the stock market, the enactment of TARP (Troubled Asset Relief Program), and the federal bailouts of AIG, Chrysler, and General Motors. By the end of 2008, unemployment had risen 3 percentage points in the calendar year, and was set to climb even higher throughout 2009. Today, the U.S has a notably low, 3.7% unemployment rate and the global rate of what the IMF (International Monetary Fund) classifies as “advanced economies”, is a very stable 5%.
Today’s employees enjoy a much more favorable labor climate than they did a decade ago. But, the Recession had a lasting impact on both those who were part of the workforce in 2008 and those who entered it more recently but experienced the economic collapse as youngsters.
Young Workers Influenced By Great Recession
For workers who were still in high school or college in the years of the Great Recession, job security is very important. Some watched parents and other important adults in their lives lose their jobs, and others may have personally experienced the loss of a family-owned business or the family home due to the economic downturn. For those just entering the workforce during a recession, finding a employment was more difficult. In fact, millennials still experience a higher unemployment rate than other generations. Workers who begin a career during an economic downturn are often expected to have relatively lower life-time earnings than those who enter the workforce in a more favorable economic climate.
Impact of Recession on Attitude Toward Pay and Benefits
A decade ago, many workers were grateful for a paycheck and basic benefits like health insurance and retirement savings plans. Today, workers have higher expectations. They are 15% less likely to perceive the benefits offered by their employer as competitive and many are attracted to less traditional benefits or perks, including gym memberships and pet-friendly workplaces. 50% of workers states that better benefits alone would entice them to leave their current job.
In 2018, employees are also 4% less likely to find their pay competitive. This is not a simple issue of perception or satisfaction, as wage growth has not risen commensurate with job growth. According to research by Randstad, 44% of workers who leave a job cited insufficient pay as the main driver of the change.
Employers should keep worker satisfaction top of mind as 2018 comes to a close, as Randstad research also found that 45% of employees have changed or planned to change jobs in the next 12 months. In a tight labor market, retention strategies are vital to maintaining a productive workforce.
Training and Performance Management Post Recession
In the decade since the recession, employees do report improvements in their relationships with management. 28% employees believe that managers support their development and 15% more report that their organization demonstrates care and concern for its employees. Most importantly, employees are more confident in the success of their organizations (up 17%).
There is also some dissatisfaction in other areas. Employees expressed concerns about career paths and workload issues. Workers are 10% less likely to feel confident about available career paths beyond their current roles and are 6% less likely to agree there are enough team members to do the work in their work group, as compared to a decade ago. The later statistic is likely a reflection of the overall global talent shortage and its impact on organizations.
Talent Retention a Decade After the Recession
As organizations work to attract and retain talent in an increasingly competitive labor market, talent management becomes vital to success and productivity. Training is important to retaining workers, particularly younger workers. And, career progression is important to workers at all levels.
Talent management tools help organizations manage talent more efficiently. With the productivity gains realized through integrated recruiting tools and paperless onboarding, your HR team can focus on strategies to impact engagement and improve retention.