Keep Key Staff
Employees with essential skills could be at risk of leaving as hiring picks up.
Turnover levels at your credit union might be low, but lose just one of your key employees and you’ll feel the impact—and bear the cost.
Employees with skills in accounting, information technology, legal, compliance, or marketing (social media) can be difficult to retain and replace, says Beth Soltis, CUNA’s senior research analyst.
Credit unions’ overall turnover rate remained at 12% in 2012. That’s similar to the two previous years, according to the 2013-2014 CUNA Turnover and Staffing Report. While the turnover rate presents no cause for alarm, the departure of essential employees can be difficult for credit unions to overcome.
Two-thirds (66%) of organizations currently hiring fulltime staff indicate they’re having a difficult time recruiting for specific job openings, according to the Society for Human Resource Management (SHRM). Analysts largely attribute the increase from 52% in 2011 to an improving economy and better prospects for job hunters.
In a survey charting the ongoing impact of the recession, SHRM notes the degree of difficulty human resource (HR) departments experience in filling key positions: u Information technology (IT)/programmers (88% of HR departments report difficulty finding these skills);
“IT positions are hot,” notes Soltis. “These are skills that everyone needs, and the skills are constantly changing. Credit unions need to make sure they pay competitively to retain these key employees.”
Marketing positions are also in great demand, especially marketers with social media skills. Larger credit unions might be able to employ a dedicated social media expert , notes Soltis, but small to midsize credit unions frequently add those duties to other marketing or HR staff .
“Credit union executives need to consider which positions, if vacated, would have a negative eff ect on the credit union,” says Soltis. “Think about how long those positions could remain open, and how difficult it would be to operate with a vacancy in a key position.”SIDEBAR:
Your HR staff might need to convince hiring managers that filling some positions will be more difficult than expected, particularly IT jobs . HR staff should work with hiring managers to develop eff ective compensation packages for hard-to-fill jobs.
NEXT: The IT battle
The IT battle
It’s a constant battle to find and retain key IT staff . “We go back and forth all the time, finding and keeping good employees,” says Chris Ayer, chief information officer at $26 billion asset State Employees Credit Union (SECU), Raleigh, N.C.
Between January 2012 and October 2013, SECU had 220 employees in information services. Of those, 41 terminated employment during that period, for a turnover rate of nearly 19%.
The credit union is located near Research Triangle Park (RTP)—a world-class center for technology firms and research institutes. “The good thing is that SECU is located near RTP,” says Ayer. “The bad thing is that we’re located near RTP.”
When looking at IT positions, job applicants will consider salary, the technology environment, and the organization’s culture.
“You’ll never win on money,” advises Ayer. “There’s always some firm out there willing to spend more for experienced staff . But most credit unions are great organizations with a purpose, and that’s hard to find today.”
Turnover by position
In addition to overall turnover, the CUNA report provides turnover data for jobs in the areas of management, lending, front-line, back-office, multitasking, part-time, and other positions (“CU turnover rates in 2012”).
Following historical trends, front-line staff turnover is the highest of all the full-time job classifications studied. Whereas turnover rates for other full-time jobs studied ranged between 5% and 10%, front-line turnover was 18% during 2012.
Front-line staff turnover was higher at larger credit unions, running 22% at credit unions with $100 million to $1 billion in assets and 31% at credit unions with more than $1 billion in assets.
Front-line turnover also varies considerably by region. Turnover rates were 10% and 13%, respectively, in New England and the Middle Atlantic zones, but stood at 33% in the West South Central region.
NEXT: Training trumps skills gaps
Training trumps skills gaps
About 30% of organizations SHRM surveyed made major strategic changes involving the use of technology in the past 12 months, such as new computer systems or soft - ware that aff ect employee work processes. Another 10% plan to do so in the coming year.
At most of these organizations, changing technology does not mean the number of employees will increase. Seventy-two percent of these organizations say these technological changes would require new skills—not new staff . Only 18% of respondents say employees would need the same skills, while 10% plan to hire new staff for those new skills.
“Culture is key to retaining IT staff ,” says Ayer. “One way to do that is to recognize your IT people, especially in the business lines.
“Th e best IT person is one who knows the technical side as well as the business side,” Ayer adds. “We make sure that most of our IT staff are heavily involved with the business side. Conversely, all our key business folks are technologists. This is tough to pull off —a clash of two worlds—but it really helps on both sides.”
SHRM’s survey of HR professionals, including those in financial firms, also identifies skill deficiencies among job applicants in other areas, including critical thinking/problem solving, professionalism/work ethic, written communications, leadership, and oral communications. (“Top five skills gaps in 2012,” p. 32. )
Recruiters also report levels of deficiencies in job applicants’ basic competencies, including:
Technology changes and skills shortages call for renewed emphasis on training. In the years ahead, SHRM encourages HR professionals to work with organizational leaders and trainers to invest in education and training as a way to meet potential shortfalls.
“Credit unions could benefit from grooming and retaining existing employees,” says Soltis, “rather than facing the prospect of paying high salaries when competing for external candidates.”
“Your employees might not currently have the skills they’ll need in the future,” she adds. “But they might have aptitudes in certain areas, and training could help them develop those skills.”
Recruitment and retention
Recruitment trends are changing in a global, mobile landscape. Investing internally could help reduce the need for external hires, particularly among younger employees. “Younger employees appreciate having an actual career path, rather than relying solely on money as an incentive,” notes Soltis.
Typically, employees searching for a new job don’t feel recognized or appreciated, or they don’t see any career trajectory at their organization, Holly DePalma, director of HR services at MidAtlantic Employers’ Association, tells SHRM.
“Let’s say they’re interested in new challenges, but they perceive an inability to move up in the organization, and you identify this person as a potential leader,” says DePalma. “Wouldn’t you be better off implementing a plan for that person to grow and develop? Turnover is costly, and good employees are hard to find.”
Replacing staff as baby boomers retire will create staffing challenges in years ahead. The U.S. Bureau of Labor Statistics forecasts a decreasing labor force from 2010 to 2020. Replacement needs will exceed new job growth vacancies in four out of five occupations.
Overall, turnover and staffing trends provide a basis for strategic planning. By projecting these trends forward, your credit union can enhance staff skill levels while containing operating expenses—and better position itself for success in a competitive marketplace.