There are three primary components that go into every healthy economic system: Employers, employees and customers.
The buyers bring capital and demand into the economy, the employers deliver supply to meet those needs and the workers are on the front lines, making sure everything comes together on a daily basis. Without customers, there’s no reason for companies to produce or sell their goods. Without employers, there’s no one for employees to work for and no supply. And without a ready and willing workforce, there’s no one to do the heavy lifting of providing goods and services.
It’s like a three-legged stool. Together, the system works smoothly. But remove one leg, any of the three, and the whole comes crashing down.
Of the three, however, the workers themselves are often the most important part of the system.
A workforce is defined as the labor pool in a given economy. It can be local, regional or national, or limited to one particular industry, but without it nothing gets done. Demand is only as good as supply, and a healthy workforce effectively controls both sides, generating income for themselves and their employers and then turning around and spending that money locally on their own needs.
In the U.S., there are about 129 million people currently in the workforce, which for these purposes is defined as adults who work full-time for 35 hours or more per week. That number fluctuates from month to month as people leave jobs, find new jobs, or otherwise change their employment status, but it remains one of the closest-watched economic indicators in the country. On the flipside, the unemployment rate is near a 49-year low of 3.7%.
What this means is that, right now, the labor market is tightening up.
Need proof? According to the U.S. Department of Labor, wage and salary costs at private companies jumped 3.1% year-over-year in the third quarter of 2018, pointing to a market where employees hold more power over corporate America than they have in decades.
As a result, it’s imperative on employers to retain the workers they do have while simultaneously looking outside for more. They can do this by carefully cultivating their workforces. Here’s how.
Train Them: No two jobs are the same and no two workers are the same. What’s more, the skills needed to succeed in today’s information economy are changing every day. That’s why it is important for training to be a regular part of every employee-employer relationship. By providing training for your employees you’ll not only be getting better workers for your company, but they’ll be better positioned to help keep you ahead of the competition at the same time.
Help Them Succeed: Employment is not a one-way street. A workforce that does well leads to companies and employers that do well. That’s why it’s imperative to make sure every employee is set up to do their best. That they have the tools they need to do their job. That they have the skills they need. And that they have the support they need so they can focus on the task at hand. Supported employees are happy employees, and that’s what leads to a sustainable, healthy workforce.
Focus on Knowledge: Turnover is part of every company’s lifecycle, but just because a valued employee leaves for a new opportunity doesn’t mean that their skills and experience need to leave with them. A strong workforce is built on institutional knowledge and companies that create a knowledge transfer process and keep that information in-house are better able to weather changes over time. What’s more, by building a foundation of company-specific knowledge, you’ll be better able to get new employees up to speed quickly and effectively.
Think Long-Term: In today’s “gig economy” it seems like many employers and employees are only thinking as far ahead and their next paycheck. If jobs come and go, why should the relationship be any more than transactional? But that’s not the way to cultivate a healthy workforce. By thinking longer-term with every hire, employers can demonstrate to their current as well as their prospective employees that they care about their contributions and don’t see them as simply disposable assets.
Don’t Ignore Culture: In the workplace, culture is generally defined as what people do when no one else is watching. It’s the set of behaviors and values that define a company. It’s “why we do what we do.” It’s also a critical part of business success, according to 94% of executives and 88% of employees, per Deloitte. What’s more, companies with strong workplace cultures score higher in just about every rating category, including collaboration, work environment and mission and value alignment. Culture matters to today’s workforce. Ignore it at your own peril.
The good news is that cultivating a workforce is a marathon, not a sprint. All of these goals are achievable and possible for organizations of all sizes. It’s just important to identify the need and get started. The workforce of tomorrow is waiting.