The last big summer holiday weekend is a big deal in the retail industry. And most IGA owners are going into it with strong shopper demand but weak inventory and even weaker staffing. COVID-19 has disrupted the U.S. economy, along with Americans' interest in actually doing any labor, some have said.
This summer, my youngest kid got herself a job. Like millions of teenagers before her, she went to work making sandwiches for a restaurant to make extra money for college. When it came time to quit and go off to her freshman year of college, we talked about her experience. See if this sounds familiar:
Food retail is hard. You have to be super careful to make sure everything is safe; people don’t appreciate what it takes. A lot of people who come in are jerks. Why does someone want to yell at her for a store policy (like wearing a mask)? She didn’t make the rules! The employee discount isn’t much of perk after you are sick of eating turkey wraps five days in a row. The job is okay, but one manager is especially difficult to work with. And how come they take so much money out of your check? That doesn’t seem fair.
In grocery we hire young people all the time. My 19-year-old focus group of one is certainly not breaking news. Neither is the fact that it is hard to hire people. We were struggling before COVID, and though it's worse now, we are likely to still struggle after, unless we rethink what we are doing.
With so many jobs available, we're facing a basic supply and demand scenario. Just like with commodities—when there is more inventory than demand, prices plummet; when inventory is restricted, prices skyrocket—the same happens with the labor market. Regardless of why so many unemployed people are not taking the jobs available (you can see the reasons in this story about the IGA labor survey), the fact remains that there are too many job openings right now.
So how do we, as independent grocery retailers, figure out how to get available workers to join our teams? Our competition isn’t just each other, but also the restaurant industry, hotel industry, travel industry, car rental industry—you name it, it's competition.
Some IGA members are trying new tactics and seeing results, and they're finding it isn’t all about pay. For example, many retailers have learned that time off is often more valuable to workers than wages. They are giving an extra day off for perfect attendance or giving 3-day weekends to workers who hit performance milestones.
Just like in merchandising, sometimes people value perks more than the real value. Fuel reward programs are great example— people will do more for $0.10 off gas than they will for actual product discounts. Recruiting is no different—one retailer is paying for hourly workers’ mobile phone service if they use their phone to take the IGA training course. “To young people, this is a huge perk that seems to have higher perceived value than actual cost," he told me. Grocery retailers have a lot of tools to make our industry more attractive, and in a buyer’s market we need to be more creative to attract people.
In our industries—grocery, wholesale, transportation, and manufacturing—we have to see the world through the lens of a worker who has lots of choices. And what they want is clear. They want flexibility. They want safety. They want meaningful work, and they want to feel like they are improving themselves and their community. They want a fun work environment and a good boss. If we can’t offer it, they will go somewhere else.
I asked my teenager if she will go back next summer to the place she worked this year. Her answer? “NO!” But it won’t be because she is lazy, or because she is holding out for more money. “Why go to work for a terrible boss?”
Like most U.S. workers, the biggest reason we stay at a job and the No. 1 reason why we flee is the same: our relationship with our supervisor. Great bosses keep talent; weak leaders create churn (and have a harder time recruiting).
Dr. Paulo Goelzer, who leads the IGA Coca-Cola Institute, sees the same thing in hard data research. I call it “hard data” because it is based on market research, and because it is hard to hear: our first level supervisors and managers often have bad management habits, and they carry those habits with them because they don’t know better.
“When we do surveys of IGA shoppers, we find that customer service and employee satisfaction go together,” he says. “When we train store management, customer satisfaction goes up, sales go up, and those stores attract and retain more employees.”
IGA offers a leadership program that includes a research step to let managers and owners learn where store leadership needs improvement. Likewise, the Way to Care program helps leaders assess and improve store culture. “It may be hard to hear sometimes, but you can’t hide from the results,” Paulo tells me. “The good news is we can fix it. And when we do, the managers are happier, too, because they know how to improve their leadership.”
Most of the Way to Care program is free to IGA retailers so take advantage of this benefit—it works! And spend some time reflecting on creative ways you can make your business more attractive. We've spent the last few weeks sharing tips, from breaking down the reasons people aren't flocking to open positions right now to offering guidance on how to attract new talent. This week, Paulo shares four best practices to retain current employees, so be sure to use these tips and resources.
If there are more jobs than people, then the smart workers are going to be picky. We would be too, if we were in their situation. Let’s use the timing of Labor Day weekend to inspire us as retailers to go get them!
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