Savvy shift managers and supervisors with highly productive, well-trained teams have a solid foundation for operational success. But maintaining an excellent workforce over the long-term is challenging, especially when labor and retention costs factor heavily into an organization’s ability to compete and remain profitable.
The key to hiring and retaining top employees often hinges on money, for both employers and employees, and employee loyalty can quickly diminish at the prospect of another organization’s higher paycheck.
Randstad recently explored this issue in a survey of manufacturing and logistics professionals
across the United States. When asked to rate which retention programs work best at decreasing turnover rates, over half of all respondents point to the power of the money, with salary increases deemed most effective. Each of the other highest-rated strategies reflect a component of “more money,” including the opportunity to advance within the organization, accessibility to healthcare benefits and the prospect of monetary bonuses.
However, when asked about their organization’s salary trends, a solid majority of manufacturing professionals state that employee pay has remained steady over the past year, with far fewer indicating salary increases.
It is here at the confluence of labor costs and workforce retention that employers can utilize the benefits of a contingent workforce to boost competitive advantage and contribute to organizational profitability.
The contingent option: Aligning labor needs with labor expense
Because labor needs tie so closely to fluctuating internal cost controls and competitive pressures, the most effective employment strategies contain a component of flexible labor to allow for just-in-time workforce contraction or expansion.
While a fixed line item clearly sets expectations of annual labor costs, it does not promote workforce flexibility
in cyclical markets or during periods of growth or decline, adjustments that impact bottom-line profitability. Because of this, the trend toward organizational flexibility and flexible employment is growing, and some predict that contingent labor could eventually comprise up to 50 percent of the U.S. workforce.
Optimizing the contingent option
To make the most of a contingent workforce strategy, many shift operations utilize the expertise of a staffing partner
to handle all phases of recruiting, screening, hiring and onboarding. With their industry knowledge and talent resources, recruiting specialists reduce time to fill, more quickly move fixed employee costs to variable employee costs and provide a predictable cost per hire. They can also generate additional savings related to replacement hires, unemployment and workers’ compensation.
With the right talent management partner, an enterprise is more likely to optimize its contingent
talent investment. Randstad is ready to share its labor management expertise and talent resources
to help your organization improve its competitive edge and boost its bottom line.