How total compensation helps the public sector with employee retention

Organisations across all industries are feeling the effects of the heightened competition for talent. While executives are aware that the cost to fill open positions is much higher than the cost to retain employees, many are struggling to identify what motivates employees to stay. And the public sector especially struggles to attract and retain younger workers against a private sector that boasts high salaries and perks.

In Ceridian’s 2022 Pulse of Talent survey, roughly 600 public sector employees were included in the more than 6,800 workers surveyed from around the globe. Of these public sector employees, we found that 47% are a flight risk – 11% are actively looking for a new role and 36% would consider leaving their current role for the right opportunity.

Unsurprisingly, pay is a top driver of turnover. Of the public sector respondents seeking new jobs, 55% want better compensation. This is far higher than the 41% of total Pulse of Talent survey respondents who said better compensation is driving their job search.

But the survey also had good news for public sector organisations. Only 10% of public sector respondents said that they wouldn’t quit a high-paying job for any reason. Instead, we learned that retention is more complex – which means organisations can compete for talent with the right strategy.

One public sector organisation that has figured out a successful formula is Milwaukee County. Since the County can’t compete on pay alone, its total compensation package helps with retention and positions it as an employer of choice.

Let’s look at three ways Milwaukee County addresses employees’ needs. 

Outline a defined career path for employees

The notion that pay is the only factor driving employees’ decisions to stay or leave an organisation is too simplistic. Employees evaluate roles far more holistically. They want defined career progression and growth opportunities. Without a clear path, employees won’t be able to picture a realistic future with the organisation.

In our Pulse of Talent survey findings, respondents were asked what their top reasons were for searching for a new job. Nearly half (42%) cited a desire to change their career paths and the same number pointed to a lack of growth opportunities at their current organisation.

This shows that while employees want to be compensated fairly for the value they produce, they also want to have a clear path for progression – whether in their current role or another path.

Milwaukee County has worked to address this by using Dayforce for data and technology to define these paths, create standardised job types, and develop greater consistency across departments. “The [Dayforce] compensation module will help us to boil [multiple disconnected positions] down to three, maybe four positions,” says Genaro Baez, Director of HR Operations, Learning and Development, and Talent Acquisition at Milwaukee County. “Once we’ve set that up, we’ll be able to communicate career ladders and succession plans on how to get there vis-à-vis learning and development and performance management.”

Having insights at his team’s fingertips through workforce management software is critical to maximising the potential of the workforce. “Not having access to dashboards and just-in-time or point-in-time reporting across our disparate data sources really handicapped us on what we could communicate regarding where the organisation is, and where people can go.”

Milwaukee County shifted from reactionary to intentional workforce planning, painting a clear picture of the future for employees.

Create employee learning and development opportunities

While having a defined career path for employees is a great start, organisations must follow through with learning and development materials and guidance to help employees achieve their chosen path.

When public sector Pulse of Talent survey respondents were asked who is responsible for employee skill development, 86% said they believe that their employers are fully or partially responsible. But 34% say that their employers aren’t doing anything to prepare them for the future.

Milwaukee County takes this need seriously, integrating employee learning and development into the performance cycle for employees and managers. Baez uses Dayforce to help make the connection between the skills employees have and those they need. He then leverages the performance management system to make training and upskilling part of employees’ goals. This helps managers have productive career conversations with employees and develop effective learning materials.

The County uses this strategy to improve employee retention and position itself as an employer of choice in a tough labour market. “It helps us be the place that employees think of versus the 12 other competitors,” says Baez. 

Upskill employees to prepare for the future of work

When planning learning and development, organisations must not only consider the skills employees need today, but also predict which skills will be valuable tomorrow.  

The main challenge with preparing employees for the future of work is that they are unaware of the need to upskill. Fifty-one percent of public sector Pulse of Talent respondents say that they aren’t concerned about the future of work. Employees may also find it difficult to know which skills they need to develop. When asked about the challenges they face in acquiring new skills, 31% cite not knowing what skills they need. 

Public sector organisations must educate employees about upskilling for the future of work, provide guidance on what those skills will be, and help to integrate this training into current development tracks. 

Baez and his team at Milwaukee County use Dayforce dashboards and data insights to map an inventory of the skills their workforce currently has and forecast the skills they will need to succeed in the future.  

“We’re trying to understand what the gap analysis looks like, and then institute training, learning and development, and organisational development type initiatives to get us to the state where we need that future workforce to be,” says Baez. “But none of that is possible without having a data-driven perspective. You can't improve what you can't measure.” 

Milwaukee County will be able to identify future gaps before they are dire by building a repository of current workforce skills. With this information at hand, the County can implement employee learning and development solutions to build these skills within their existing workforce. 

Public sector employers can demonstrate a competitive value proposition by going beyond pay and focusing on an employee-centric total compensation offering. This will ultimately help to retain current employees and attract new talent.