What's fresh

Employee retention strategies for top graduate talent

The recruitment process can be a draining one for businesses. Not only does it take up precious business time, it's expensive too. In a report from advisory firm CEB , it was found that British companies collectively spend nearly £900 million a year trying to attract the best and brightest university leavers.

The problem is even if companies do attract the best graduates, many new millennial recruits leave for different jobs within a short amount of time. Current figures show that the average time a new graduate spends in their first job is less than 18 months, with 1 in 4 graduates moving on within a year. Eugen Burke, chief science and analytics officer at CEB says “Today’s graduate recruitment market is stuck in a vicious circle,” he said. “Graduates are struggling to wade through generic company messaging to find their way to the right job while businesses are wasting millions chasing high numbers of graduates who leave within the first year.”

So how can businesses create strong employee retention strategies and make sure graduates won’t disappear within the first 18 months or even 3 years?

Before they join

Be clear in your application what the daily job is - Many graduates say that, a lot of the time, there’s nothing within the assessment, marketing or careers fairs that show what day-to-day job actually entails. Being very clear in recruitment pages about this will likely avoid dropouts. Some graduates will not actually have a conception of what 'retail' or 'consulting' actually is on a day to day basis, especially if they have not completed a work experience scheme.

Give them a chance to experience it

  • If you are a big company offering a graduate a job in October to start the following year, getting them in for a day or two can be a good way to give exposure to the actual day-to-day. This is a lot more effective than people leaving after training them for a year, for example.
  • If you are a smaller company, not recruiting a year in advance or without the bandwidth to bring people in is more effective. Also, make sure that the assessment involves doing some of the work that they would actually be doing. Did they enjoy the task?

Progression and learning

Keep in touch with your grad - Make sure line managers for graduates are personable and approachable. Negotiate future possibilities, address any concerns immediately. Don't let it get to the stage of a surprise hand in of notice – make sure open, honest and frank discussions are encouraged so that you can get the most out of each other. 

Advertise your continued training beyond a scheme - To draw the best out of staff, continuing to offer additional training as an important way to develop talent within the company. If graduates know they will be invested in for a long time and won’t be ignored after the graduate scheme, they might be more likely to stay beyond the training programme, rather than seek additional training elsewhere.

Give responsibility in new emerging fields - Graduates know the latest trends, particularly in technology. They can offer you fresh perspectives and directions your company may never have thought of. Graduates love being trusted with some extra responsibility or having their own project to work on and develop. Career progression and contribution were ranked higher than salary by graduates when asked what they want from a job. Don’t be scared to give them different projects or tasks which test their ability. This will only help them to develop their skills set.

Rotational schemes are attractive - A rotational structure during a graduate scheme provides candidates not only with the opportunity to show off their talents over a broad range of area but to understand how different departments work and link together in a business. It also helps graduates to see all aspects of your company and work out what they might actually like to do in the long term, rather than moving to a rival firm in order to try something new. Obviously, not everyone can offer a rotational scheme, in a smaller context just think variety where possible. 

Reward people who stay - It’s well known that job hopping is the best way to secure promotions and pay rises. If you have had a promotion dangling over you which you have been chasing for you a year and someone is parachuted in at the same level or higher, with much less experience and you pay them the same or more money you will cause resentment. Reward the people who stay is a simple way to keep loyalty. 

Remuneration

People always ask fresh graduates how important money is for them, and a good proportion usually says it isn’t.

They are not lying, however, bear in mind they haven’t started working yet and the pay check is quite theoretical. Over the first year or so when they realise what real life costs, and see their friends being paid more than them, have to live somewhere less than lovely and can’t go on holiday it becomes a bigger consideration.

The problem is disguised by candidates not being honest with either future employers or their previous employers on why they are moving. Sometimes they are not even honest with us! However when the offers comes in, and push comes to shove the salary is a big reason why people move or stay. In fact, in our recent Question of the Month survey on factors for job satisfaction, which was taken by different career levels in the network, salary came out as second most important aspect after company culture.

So here are some things to consider:

  • Survival - If your employees are on baked beans for the last week of the month, can’t go on holiday or unable to have any fun with friends because they are broke they will be miserable. Miserable people are unproductive and are easily tempted away. So what’s enough? In London, paying a starting salary of £23,000 a year, after bills, rent, council tax, travel card, phone bill, and a gym membership they are essentially left with approximately £80 a week for clothes, food, necessities and, maybe, have some fun. One unexpected cost in a month and they are in a bad position. A base minimum of £25,000 is far more attractive and sustainable, and £27-35k, especially in comparison to your competition, is much better.
  • Beyond Survival - Money past a certain point is not really about money. As time goes on if other businesses are constantly offering more, friends are earning more and other colleagues at similar levels earns more, there will be feelings of being undervalued. Pay reviews and checking in is worthwhile in the long run.
  • “But we…” There are a lot of “sexy” start-ups, desirable brands and fast growth companies who rely on brand to not pay as much for salaries; “we are changing the world”, “we don’t want people chasing money”, “they should just want to be here”. That’s ok, but with retention, thinking long term about progression and other opportunities when the initial excitement has worn off is worthwhile.

Recruitment has become more of a two-way process – not only does the employee need to vy for the position but the company needs to show why they should choose them rather than another one. In contrast to previous years, the job market is booming, there is vast competition and you may find that you need the top graduates more than they need you.

Chris Long Freshminds

Chris Long

Head of the Graduate and Early Careers Team

 

Chris leads the Graduate and Early Careers team, helping businesses to find the top talent for commercial and strategic roles or as part of internships and schemes.

 

Interested in finding out more about how to hire and retain graduate employees? Get in touch with Chris to discuss how Freshminds can help.