Money can’t buy talent.
Even though the average salary increased by 5% in 2022, this didn’t stop bank employees from leaving at an alarming rate. 2022 brought on a 23% turnover rate amongst financial service institutions.
Banking leaders are concerned.
According to a 2022 Crowe Bank Compensation and Benefits Survey, “the top five human resource management issues were related to finding, motivating, and developing the right people. Finding and hiring the right people was top of mind for 95% of respondents.”
What was once held as a prestigious and promising career – has fallen prey to quiet quitting, where employees are buying time, or the great resignation, as they embark on a new career path altogether.
But your clients and stakeholders don’t care about this problem. They care about their needs and the results they expect you to deliver.
I recall my days as a Business Banking District Manager. It didn’t matter if we were short staffed or if portfolios were left unmanaged, clients demanded calls returned, financial needs met, and leadership expected sales targets to be achieved. Whether you were fully staffed or down by 20%, results were non-negotiable.
With the persistent departure of tenured and experienced talent, banks and credit unions run the risk of eroding client trust and loyalty and exposing themselves to undue risk. On top of that, they risk a loss of sales and revenue because of staffing shortages and an over-reliance on new and underdeveloped employees ill equipped to have effective, thoughtful, financial needs-based conversations with clients.
But all is not lost, and there is a way forward. Here are 3 ways to entice new employees to join your organization and engage and empower your current talent to re-commit their career to your mission:
- Invest in selling beyond the transaction
People in banking didn’t start in banking to sell mortgages and investments. They got into this business to help people. They just happen to sell financial products and services as a way to provide that help. Similarly, your FI’s mission is about more than sales targets. Your employees need to feel connected to that purpose and mission, and know they are contributing to advancing that meaningful mission. According to a McKinsey study, 70% of people define their purpose through their work, and millennials are more likely to see their work as their life’s calling.
Your employees need to know they can live out their personal purpose by working for your organization. More than that, they need to know how their unique perspectives, personality, and expertise add value to your clients. They need to be recognized and respected for the difference they bring and make.
- Improve employee financial wellbeing to increase engagement and performance
Gallup identified five elements of wellbeing that differentiate a life of survival from one that is thriving, many of which can be met in the workplace:
- Career Wellbeing
- Social Wellbeing
- Financial Wellbeing
- Physical Wellbeing
- Community Wellbeing
As financial professionals, the one I want to draw your attention to is #3 – financial wellbeing. When someone has financial wellbeing, they have enough money to meet their needs and don’t worry about how they will pay their bills. They feel financially secure. No matter if you live paycheque to paycheque or have millions socked away in the bank, you can still feel financially insecure.
Having the ability to navigate through financial stressors and hardships from unplanned life events is known as financial resilience. Research from the Financial Resilience Institute, an organization that partners with financial institutions and policy makers to help Canadians improve financial resilience, health, and wellbeing stated that 78% of Canada’s population have some level of financial vulnerability and that 77.8% of the population are not ‘Financially Resilient’.
These financially vulnerable people work for your organization. They are out there helping clients become financially resilient while at the same time struggling themselves. When employees are troubled by their finances, they experience more stress and worry. This impacts the emotional state they bring to work which ripples into their performance and engagement.
As a bank and credit union, you have the right resources to educate and empower your employees to be financially healthy, wealthy, and wise. Your compensation package is not only about salary and benefits. It’s about the tools and means you offer that teach your employees how to save, spend, and plan for their money so they too can be financially resilient and have financial wellbeing.
- Help your people financially empower your customers
What if you could overcome your talent shortage while at the same time improve client loyalty and increase sales and revenue? This trifecta solution is not a myth; it sits right in the hands of your employees who could be financially empowering your customers.
A Gartner 2022 Banking Study found that financial service institutions that enable their frontline retail banking employees to financially empower their customers double the percentage of high performing bankers on their teams. That’s right, when your employees do more than sell a transaction, providing advice, guidance, and support, that helps clients improve their financial wellbeing while you improve employee engagement, performance, and client relationships.
William Glasser, an American psychiatrist and developer of reality therapy and choice theory, said this about how we retain what we learn:
“10 percent of what we read;
20 percent of what we hear;
30 percent of what we both see and hear;
50 percent of what is discussed with others;
80 percent of what we experience personally;
95 percent of what we teach someone else.”
When you move beyond selling a transaction, elevate your employees’ financial wellbeing and have them teach your clients how to be financially empowered, you set your organization apart with highly engaged, top performing talent that stands out from the competition, because your clients learn how to be financially healthy, wealthy, and wise.
Want to learn more? Watch the ‘3 Trends in Financial Services to Retain your Competitive Edge’ webinar. This this presentation includes persuasive research, customer insights, and actionable shifts you and your sales team can implement right away. Check it out here.
Even with increased compensation, banks are struggling to hire and retain talent (prnewswire.com)
2022 Crowe bank compensation and benefits survey highlights
How to unleash the power of purpose at work and in life | McKinsey
Overcome the Retail Banking Talent Shortage (gartner.com)
Research Reports and Whitepapers | Financial Health Survey (finresilienceinstitute.org): June 2022 Index Report