A local cafe recently put up a new sign. "Help Wanted," it reads. "Wages up to $20. Earn Up to $1,000 in Bonuses."
Twenty dollars an hour seems like a lot to pay cashiers and sandwich makers, especially since minimum wage in Virginia is $9.50. But clearly it's not: Within two miles of that cafe, I saw at least six other "Help Wanted" signs in the windows of restaurants and retailers.
All mentioned the wage rate. Many promised bonuses.
But clearly money appeals aren't working.
One fast food restaurant is short-staffed and hasn't opened its dining room for the past two months. A retailer has had the same sign-on bonus announcement in the window for three months. One restaurant stopped opening for lunch altogether; it cannot attract sufficient wait staff or enough people to prep and cook across both shifts.
They're not alone. A recent survey by the search firm Korn Ferry found that over 90 percent of retailers are struggling to fill empty positions, even though nearly one in three offer sign-on bonuses and another third have instituted paid referral programs.
Why doesn't money work? Because workers have options. In large part, retail and food service jobs are entry-level positions, and in the current economic climate, entry-level positions abound. Offices. Warehouses. Manufacturing. Construction. Delivery.
Generally speaking, if you want a job, you can find one. And you can probably find another one that pays a little bit more.
Which leads to the real point. We've all seen the Gallup research that shows people leave bosses, not companies. Money matters, but only to a certain degree. Perks matter, but only to a certain degree.
Once pay and benefits are fair -- not industry-leading, just appropriate and reasonable -- how you treat people makes a huge difference.
That's something Mark Cuban warned employers about last year. "How companies respond to that very question is going to define their brand for decades," he said. "If you rushed in and somebody got sick, you were 'that' company. If you didn't take care of your employees or stakeholders and put them first, you were 'that' company."
Treating people poorly? To Cuban, that would be "unforgivable."
That's why people leave. Having options just makes it easier for them to leave.
That's also why people choose to work for, and stay with, certain employers.
And that's why people feel comfortable recommending certain employers to their friends. If I don't feel valued, I won't recommend your business to a friend -- even if you will pay me to do so. No referral bonus is worth having to explain to a friend why you lured them into a crappy job.
Want to improve your odds of keeping your best employees and hiring potential superstars? Get your pay and bonus systems in order, and then think longer term.
One example: A study of more than 400,000 people published in Harvard Business Review found that when employees believe promotions are managed effectively, employee turnover rates are half that of other companies in the same industry. But wait, there's more; Productivity, innovation, and growth metrics outperform the competition. (For public companies, stock returns are almost three times the market average.)
Promoting the right people matters, because it shows you value integrity and equity. Promoting the right people shows you reward performance and potential.
Bottom line? Money matters -- until it doesn't.
Because you can't buy great employees.
But you can definitely earn them.