As a small business owner, your employees are your greatest resource. Just like you can’t have a business without customers, your business can’t thrive without a team to serve those customers, directly or indirectly. With the labor shortages accompanying ongoing pandemic recovery efforts, many employers are finding themselves in a tight spot. They have plenty of customers, but not enough employees to meet their customers’ needs.

Small businesses everywhere are struggling to keep the doors open because they are short-staffed, and far too many are losing the battle every day. Everyone seems to have an opinion about why we’re in a labor shortage, but the reality is it’s most likely the result of a combination of issues, including low wages, expanded unemployment programs, childcare shortages, illness and death, fear of personal safety, pandemic stress, burnout, and job or career dissatisfaction.  

6 Keys to Small Business Employee Retention in 2021 and Beyond

Recruiting and retaining good employees is never easy, but it’s especially tough in a tight labor market. And this market is unlike any we’ve ever seen. Not only are employers having a hard time filling open positions, but they are also losing employees in what’s been coined “The Great Resignation.” People are quitting their jobs in record numbers, and experts project another big wave of resignations is coming.

To meet this challenge, small business leaders are going to have to rethink the way they approach employee retention. Here’s how.

1. Show That You Care

Small business owners have been through the wringer over the past year. It can feel like a real gut punch to realize people want to walk out of the jobs you fought so hard to save. However, it’s important to put yourself in your employees’ shoes; they’ve been through a lot over the past year too, and there’s a good chance they are experiencing burnout. There’s also a chance that in your heroic efforts to save the business, they may have felt underappreciated or as if they have little to gain from the outcome. 

Put as much effort into trying to save your employee, and improving your relationship with them, as you would your top client, or someone you love. Let them know you see them, appreciate them, and make a concerted effort to recognize and meet their needs. Make sure they know you care about their safety and what matters to them. 

2. Open Lines of Communication

Employees value transparency; it helps them feel like they are part of something. Being kept in the dark breeds suspicion, discontent, and trust issues. While you might not be able to share everything all the time, the more you can bring them into the fold, the better. 

Let employees know your plans, what’s going well, where you’re being challenged, and what keeps you motivated. Equally important, listen to your employees. Ask for their feedback, input, and updates. Do this regularly and often, not just during official meetings and performance reviews. Don’t leave them guessing and feeling disconnected from what’s going on in the company.

3. Create a Path for Success

One of the biggest reasons employees experience job dissatisfaction is that they can’t envision a future with the company. Looking for more than a steady paycheck, your best employees also crave opportunities for learning, growth, and advancement. If you can’t offer that or help them see the benefit of sticking with you, they’ll seek opportunities elsewhere. 

Creating a path for success might look different for each employee. Some may want opportunities to expand their skills and impact, some may want to move into leadership, and some may be most interested in what they can do to increase their pay. Find out what motivates them, and offer regular feedback, ongoing coaching, and a compelling path forward.  

4. Build an Employer Brand

If you think of branding as a marketing activity, you’re missing out on a big opportunity for both recruiting and retention. According to the Society for Human Resources Management, “an employer brand is an important part of the employee value proposition and is essentially what the organization communicates as its identity to both potential and current employees. It encompasses an organization’s mission, values, culture and personality.” 

It’s about employee culture, but it’s also about embracing an identity. People want to be a part of something bigger, they’re looking for meaning in their work, and they want to feel like they belong. They want to be able to say why they do what they do and who they do it for—from a big-picture perspective—no matter their role. When employees have a strong connection with their organization’s culture and brand, they show a higher level of engagement and are more likely to stay. 

5. Provide Employee Recognition

While it might seem obvious that employees are more committed and work harder when they believe their efforts are appreciated, employers often put little thought or action behind their employee recognition efforts. Even if the sentiment and intention are there, it’s not the thought that counts–your employees need to believe they’re appreciated. 

Employee recognition is not just about handing out gifts and awards; it’s about cultivating a culture of appreciation, becoming an advocate and cheerleader, and doing what you can to ensure employees want to show up and put forth their best effort every day. 

6. Support Work/Life Balance

Over the past year, millions of people have reevaluated their priorities. Chances are, even your most ambitious employees are placing more value on life outside of work than ever before. From putting family first to valuing self-care to carving out time for hobbies, travel, and other interests, more and more people are no longer willing to let work consume them; supporting work/life balance is key.

Workers want more control over their schedules, work environment, and ability to take care of responsibilities outside of the workplace. People who had a taste of working from home are not willing to go back to long commutes or distracting office environments; they’re insisting on hybrid options if not fully remote. Some jobs lend to more flexibility than others, but employers are going to have to do what they can to meet this seachange. 

Lead Through Change

Overall, once again, small business leaders must rise to the occasion. You can’t make everyone happy all of the time; jobs have to get done, and it’s not always fun. But the reality is, job satisfaction is the key to retention, productivity, and your long-term business success. You are probably in a tough spot, and it’s not your fault, but blaming all labor shortages on factors outside of your control is not going to help you make the most of what you have right now. 


Do you need help creating or managing an employee retention or recruiting program for your small business? Contact us for a free consultation today.