Weapons in the War for Talent

Posted on November 10, 2010

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Google’s decision to increase the salaries of all its employees by 10% is a rather radical response to a problem with employee retention that the company is struggling with.

Given an economy that is improving at a slower than expected pace, and an unemployment rate that has yet to dip under 9%, some may be forgiven for scratching their heads and wondering what Google executives were thinking.

According to an article in the Wall Street Journal, the pay hike is an effort to hold on to staff, many of whom are seen at risk of defecting to competitors. In fact, a number of key Google executives have joined rival Facebook in the past year.

So, should your company take Google’s lead in giving everyone across the board a big raise?

The answer is probably not. But one thing employers might want to consider, if they aren’t doing so already, is doing a better job of communicating the value of the compensation and benefits they are already providing.

I was reminded today of the importance of this as I was reviewing the results of a survey we conducted to gauge employee responses to recently distributed total compensation statements:

I didn’t know that the company pays as much for our benefits as it does.

I didn’t realize the amount that the company pays for family health insurance. Thank you for doing this and my family and I really appreciate the company covering this.

I sometimes take health care for granted and this brings my focus back to what it really costs for those benefits.

The amount the company pays to cover our health, dental and vision. It really makes our compensation package even more impressive!

The common theme in these comments is that employees didn’t realize what the employer was actually paying on their behalf.

So for those employers who may be looking for tools to hold on to employees, there are options other than massive, Google-style raises. Making sure that employees are made very well aware of what they are already receiving may be a good place to begin.