HR in the Current Economy Survey Results

The factors facing the banking industry today make finding and keeping talented employees extremely difficult. Low unemployment, candidate demands, employee expectations, and organizational performance goals mean more organizations are turning to their HR functions to reach their full potential. We heard those sentiments loud and clear from members of the WBA in the results of the 2019 Human Resources Planning Survey conducted by The QTI Group.

In September 2018, 90 banks and financial institutions participated in QTI's annual survey of HR challenges and practices within the state of Wisconsin. We have recently published the full results and findings on QTI and WBA's websites (www.qtigroup.com, www.wisbank.com/QTIsurvey). Key challenges highlighted by the members include:

  • Attracting the right talent
  • Higher compensation demands
  • Enhancing employee engagement

Attracting the Right Talent
We saw a substantial majority of banks (90%) finding moderate-to-significant challenge in finding good, talented candidates to fill open roles. The banks are not alone in this concern; we are seeing the general industry struggle as well. The difference we see for the banks is a battle (72% reported difficulty) to find entry level employees, those in the non-exempt office roles (such as tellers). Outside of the banks, the concern is more professional level white collar jobs.

As banks try to attract the best and brightest, they have turned to highlighting their company culture, benefits offerings, and environment to draw in people. Other ways to draw in talent is to seek known commodities… like friends and family. Some have turned to referral bonus programs averaging $400 per hire. Unfortunately, that is about ½ of what we see outside of the industry.

Higher Compensation Demands
Cash is still king when it comes to the importance of rewards at work. With unemployment at historic lows in Wisconsin, we see candidates and employees flexing their influence and demanding higher pay. Even as banks focus on culture, benefits, and total rewards to get people in the door, base pay ranks as the most important reward option reported. 

Banks see rising pay as a challenge (79% report a moderate-to-significant challenge) in 2019. After being 10 years removed from the Great Recession, we are only now starting to see pay increase budgets begin to rise. Wisconsin banks are anticipating 3% base pay increases, and other outlets are reporting 3.0%-3.2% increases for the upcoming year. As new hires arrive with higher pay, we find that 64% of banks experience pay compression between new hires and current staff, and over 50% are losing talent to higher paying offers.

Bank leaders are feeling the pressure on both the pay and benefits fronts. Eighty-one percent of respondents see benefit cost containment as a moderate-to-significant challenge. There are not unlimited resources to allocate to the total rewards pie; banks should survey their staff to understand what they value, as well as develop communications strategies targeted at the most valuable aspects of the rewards package for employees.

Enhancing Employee Engagement
Anything banks can do to get out of the vicious circle of turnover and recruiting, and retain their current talent by focusing on appreciating, recognizing, and rewarding them will create a more productive banking environment. Of the participating banks, 78% view enhancing employee engagement as a challenge for next year. Internal training programs, mentoring, and coaching are options that a majority of respondents are using to focus on development of the team to help the organization reach its potential. One way to understand how to engage your current workforce is to ask, either through formal employee engagement surveys, like QTI Engage™, or individual stay interviews, which only 27% of the participating banks are conducting.

Connections
QTI's final takeaway from the survey this fall is that banks have a great opportunity to create stronger bonds and connections to their staff in 2019. Competitive pay, accountability, recognition, and open communications can go a long way in driving performance of employees, attracting new talent, and ultimately providing great customer experiences for the bank. Balancing creativity and tried-and-true methods to engage staff will help the banking industry reach full potential.

Shefchik is COO - Strategy and Engagement at The QTI Group, a WBA Associate Member.