Dialing Up Retention, Building Loyalty That Lasts During a Recession

Despite the dismal nightly news about rising unemployment, home foreclosures, bank failures, collapsing manufacturers, and Wall Street meltdowns, getting up in the morning and going to work in the senior living sector feels similar to two or three years ago. No general layoffs, bankruptcies, or off-shoring of jobs - there are still seniors to care for, and work to do.

Yet no one is immune from the crisis, either. Human resource executives report that the economy is starting to impact their workforce-both directly and indirectly. Fortunately, the news isn't all bad. In some ways, the sorry state of the economy has had a positive impact on employee recruitment and retention. Employers report record numbers of responses to job openings, even for part-time positions. Attrition has declined at some companies, as employees hold tighter to their jobs. Any improvement in these two areas is welcome, especially considering the high turnover rate in senior living. At the same time, individual employees are experiencing deeper stress in their personal lives, including financial woes, as evidenced by the increased use of employee assistance programs and requests for loans from personal retirement plans at some companies.

Whether these signs point to a trend or simply a blip as people adjust to the recession remains to be seen. "I'm not sure if it's a coincidence or the start of a trend," says Rick Parker, vice president of human resources for Assisted Living Concepts based in Menomonee Falls, Wisconsin. Regardless, Parker and other HR experts suggest now is the time for providers to turn their attention to building their reputation as a good place to work-their "employer brand"-not so much to attract new hires, but to deepen the mutual commitment with existing employees. "This is a time to really understand the stresses people go through and turn up the compassion side. We're all in this industry because we're into compassion. It's time to tune into the compassion side of what drives us all," Parker adds.

"Now is the time to be doing the other things that are important, or what I call psychic compensation. To become known as a good place to work without having to spend 10 percent more on compensation," agrees Bill Ford, president of SESCO, a human relations consulting firm.

Under- and Overqualified

A glimpse at recent hiring and retention initiatives at several companies yields several strategies for assisting employees. "If anything, we're dialing it up," says Glenn Maul, senior vice president of human relations for Nashville-based Brookdale Senior Living. "The time to build your retention is not some other time. It's now." Emeritus Senior Living recently received 100 resumes in a single day for a receptionist in its Seattle headquarters, and 50 resumes in two days for a part-time receptionist position at its Sandy Springs, Georgia, community. In each case, the position was advertised only on the company Web site. "Normally, we would post the opening at Monster.com and Craig's List, but we didn't have to," says Liberty Stansberry, national director of human resources.

Other providers report similar experiences, as do job posting sites. The ALFA Career Center has seen fewer job postings, while the number of job seekers visiting the site and posting resumes has doubled from a year ago. At first glance, this hiring climate would seem good for companies' advertising budgets. On the other hand, many applicants have little or no direct experience, and are just looking for any job they can get. "We don't just hire warm bodies. Even though there are more applicants, I won't say there is a significant increase in people we'd hire," says Maul. At the same time, though, Maul sees overqualified applicants. "Applicants are coming from a much higher position than they are seeking."

Some companies also report a decrease in voluntary attrition. Under the current economic conditions, employees generally aren't taking undue risks with their livelihoods. "Employees who may have left our employment are now coming back asking to be rehired. It's a very interesting turn of events happening now," says Carrie Todd, director of human resources for Solana Beach, California-based Senior Resource Group. "Just a short time ago, most had prioritized their assets as home, savings/retirement accounts, cars, etc., but are now realizing their No. 1 asset is their job."

As with the loosening recruiting climate, recent improvement in employee retention comes with an asterisk attached, according to affected companies. For example, the source of an employee's improved loyalty may have to do with the fact that her spouse is temporarily out of work and she suddenly needs to work more hours. "Before, employees who worked 15 to 20 miles away were leaving to go to similar jobs closer to home because of gas prices," says Maryann Hughes, vice president of human resources for Five Star Senior Living of Newton, Massachusetts. "Now, there's been a little downturn in turnover."

Help with Coping

Further evidence of the recession's effect is found in the number of employees seeking counseling services. Five Star Senior Living has experienced a jump of more than 10 percent in the number of employees seeking help via the company's employee assistance program (EAP) because of work-life issues. The company also has seen a 10 percent increase in requests for hardship loans from 401(k) plans in 2008 compared to the previous year, and a noticeable increase in wage garnishments for employees climbing out of debt. Other companies, such as Senior Resource Group and Emeritus, report similar trends.

Employee & Family Resources of Des Moines, Iowa, which serves 16,000 employees in the senior care sector, confirmed an across-the-board increase in service utilization. "In the past six months, requests for EAP services exclusively for financial concerns doubled over the previous six months," Director of Workplace Services Julie McClatchey said last November. During difficult times, cost-saving options are obviously on the table as well, including reducing travel, condensing regional resources, slowing or eliminating nonessential hires, forgoing technological upgrades, and so on. But, Parker warns, now is not the time to back off from employee-centered programs that help retention. "Oftentimes, what do get cut early on are training, insurance, and EAP services. Yet those are the things we do not need to be cutting," says Parker.

Carlton Senior Living based in Martinez, California, plans to enhance training, compensation, and benefits, as well as individual recognition programs. "The focus now is shifting from attrition to retention, where we invest resources in the stronger assets to build their skill base, because we want them to remain when the economy does improve," says Allen N ickerson, vice president of human resources. "We believe it will, and when it does, we want to be positioned so that there is not an exodus of quality staff to greener pastures."

Seven Strategies

Conversations with nine employers and HR experts yielded a range of suggestions for bolstering employee retention:

• Overcommunicate with employees. Talk honestly about the situation so there are no surprises. "The challenge ahead is to not get into knee-jerk situations where one day you're going along and not telling people the situation and the next day you're slashing incomes. That, to me, is the worst," says Hughes.
  


• Be good listeners. Emeritus began holding town-hall style meetings to connect senior executives with employees in the field after its merger with Summerville in 2007 and has implemented many of the suggestions gleaned from those meetings. "Make sure employees know they do have a voice on things like our benefit programs," says Stansberry. "The feedback is a constant focus for us."
  


• Promote counseling resources. "I hope it does get used more, because our EAP is underutilized and these are stressful times," says Parker. "What I think is that [employees] don't think of it. It doesn't come to mind."
  


• Step up hospitality for employees. Through its Genuine Hospitality Program, Senior Resource Group has increased retention by close to 20 percent, partly by treating employees the way they would like employees to treat residents. "The 'little things' that we do for our employees do not go unrecognized. From a simple acknowledgement to a small gift, employees need to feel appreciated," says Todd.
  


• Keep incoming resumes relevant. Consider using an industry-specific job board such as ALFA's Career Center instead of general sites. Also consider a referral strategy: Through its new "Good People Program," Brookdale offers ongoing financial rewards to employees who successfully attract new prospective hires to the company. The result has been a 3 to 5 percent increase in retention among new hires, but also a 5 to 7 percent increase in retention among employees who make referrals.
  


• Reassure employees that mission still comes first."Especially with health-care employees, it's sacred to have a mission, or 'family' values, or whatever you want to call it, spelled out," says Stansberry, adding that mission matters as much as compensation for many workers.
  


• Tailor employee benefits. In the face of continually rising health-care costs, Five Star Senior Living has found a way to help employees while reducing costs by focusing on preventive wellness and disease management. Emeritus has not raised premiums on its most widely used plans for three years, and offers a "zero cost" plan with no premium and a high deductible. Single-parent families also pay lower rates than double-parent families.

Some HR executives make the case that assisted living and senior living companies are in a decent position from a workforce retention point of view, even if the economy gets much worse. The nature of the work cannot be sent overseas, and many operators already run a flat, flexible organization.

"If a company continues to hire for what it needs without being top heavy, employees and executives shouldn't have anything to worry about. Our residents still need the care and services they signed up for-that hasn't changed," says Todd.

"I don't anticipate doing a whole lot different in 2009. I think assisted living [companies] do a great job of having a streamlined organization," says Parker. "Long-term consistency is better than a yo-yo approach to systems and programs."