By now, we’ve all heard of the Great Resignation and as business owners, we want to make sure that exodus does not affect our firms. We’re all searching for tips and tricks to retaining employees who embody our firms’ core values. Over the last two years, the COVID-19 pandemic either exacerbated or exposed inflation, wage stagnation, inequality, toxic corporate culture, and many other factors that forced good team members to go elsewhere. In an article for the Pew Research Center, Kim Parker and Juliana Menasce Horowitz explain why so many workers quit in 2021. Most workers who quit in 2021 did so because of low pay, “no opportunities for advancement” or because they felt disrespected in the workplace. Workers also cited insufficient benefits, lack of flexibility and child care issues.
Two years later, the Great Resignation has yet to lose steam. According to Stefan Ellerbeck in a June article for the World Economic Forum, “one in five workers plan to quit their jobs in 2022.” The possibility of better pay remains one reason workers are planning to quit this year. However, the reasons why workers are quitting their jobs have changed somewhat since the beginning of the pandemic. Ellerbeck writes that “over two-thirds say they are seeking more fulfillment in the workplace.”
Workers want fulfilling jobs with supportive teams that encourage them to be creative, innovative and true to themselves. Whether you own a small firm from home or a successful interior design business with multiple studios, it can be difficult to retain top talent. In this post, we offer our tips for retaining creative employees in today’s market. From rewarding workers to fostering your company’s culture, our employee retention strategies all start with hiring the right employees. Follow below to learn all about how to retain employees in 2022.
15 Creative Employee Retention Strategies for 2022
Most employee retention strategies begin with informed, focused hiring practices. Carefully defining each role and choosing the right people for those roles goes a long way towards retaining talent. Of course, offering competitive pay and benefits packages helps too. In today’s labor market, however, offering competitive pay, providing adequate benefits and explicitly defining expectations is not enough for interior design firms to retain top talent.
Other elements — like flexibility, learning opportunities and company culture — are equally important to workers in 2022. Below are fifteen employee retention tips for small business owners who want to inspire and encourage their team of creatives.
#1 Figure Out Your Company’s Employee Turnover Rate
First, small business owners should figure out their employee turnover rate. Some refer to turnover rate as an “attrition rate” or “churn rate.” Most businesses calculate either a monthly or an annual turnover rate. You can do so by dividing the number of employees who left the company by the average number of employees. Multiply that value by one hundred to turn your turnover rate into a percentage.
This resource from the Society for Human Resource Management explains how to determine the average number of employees your company has on staff. According to SHRM, businesses should count both full-time and part-time employees, but should not include any independent contractors.
To calculate the most accurate turnover rate, your company’s HR department should conduct a head count of full- and part-time employees regularly. SHRM recommends a company-wide head count every one to two weeks. After a few months, add up the results of all these headcounts and divide by the total number of headcounts. This calculation will provide you with the average number of employees needed to figure out your company’s turnover rate.
The last piece of the puzzle is how many separations occurred in your target timeframe. Of course, there are many reasons employees leave a company. Some leave to care for an elderly, injured or ill relative. Others leave because they themselves have fallen ill or sustained an injury. Some retire from the workforce altogether, while others quit to have children or pursue educational opportunities. Certain employees might be laid off or fired for cause. Still others quit because they want to find a job with higher pay, better benefits or a different company culture.
Voluntary vs. Involuntary Separations
SHRM recommends adding “voluntary and involuntary separations” and warns against including any “leaves of absence or furloughs.” As noted in the introduction to this post, attrition rates are relatively high in 2022. An attrition rate below 10% and retention rate above 90% is generally considered adequate. When calculating your company’s attrition rate, remember that not all voluntary separations are due to discontent. Connect with your HR department to get a better idea of why employees are leaving.
#2 Familiarize Yourself With Common Causes of High Employee Turnover
Replacing an employee is not only disruptive to the team that employee leaves. It can also be incredibly expensive for your interior design business at large. Picking the right employees from the get-go and putting effort into retaining them can actually save money in the long run. According to Shane McFeely and Ben Wigert in a Gallup article, replacing an employee can cost “half to two times [their] salary.”
Interestingly, McFeely and Wigert write that many workers would have stayed had supervisors listened to their concerns. In fact, 52% of workers who quit said that “their manager or organization could have done something to prevent them from leaving their job.” Given this, the second step on our list of tips for retaining creative employees is to familiarize yourself with common causes of voluntary separation.
Certain causes of employee separation cannot be controlled – like retirement, illness and caring for a loved one. In her article “How to Calculate and Improve Employee Turnover” for Business News Daily, Skye Schooley identifies some of the preventable causes of separation. According to Schooley, employee turnover is often “caused by unfavorable workplace circumstances that can be managed.”
If employees quit because of their experience at your interior design business, your team can probably make a few improvements that prevent future separations. Quoting Summit Search Group’s Matt Erhard, Schooley explains. Erhard tells Schooley that “‘employees are more likely to quit if they feel underappreciated and overworked.’” High employee attrition could also come from “poor management, negative company culture, lack of career opportunities and advancement, and inaccurate job descriptions.”
#3 Identify and Solve Any Underlying Issues That Might Lead to Attrition
Stemming from the second step in our guide to retaining employees, this next step is self-explanatory. Small business owners should identify and try to solve any underlying issues that might lead to higher rates of attrition. To do this, business owners can meet with their company’s HR department to obtain a breakdown of each department’s attrition rate.
They can also meet with managers whose teams have recently shed an undesirable number of employees. Conducting employee satisfaction surveys in departments with high turnover can also help you identify and solve issues before more workers leave the company.
#4 Tailor Your Company’s Flexible Work Policy to Meet Individual Needs
Fourth on our list of creative employee retention strategies is to tailor your company’s flexible work policy to meet individual needs. Each employee in your company has a different home life and a different approach to managing tasks. Some prefer to work independently at home, while others need direction and community to thrive.
Acknowledging these differences and finding ways to adapt your company’s policy to fulfill each employee’s needs can help retain creative talent. Just be sure to implement these policies fairly and transparently. For more information, head over to the Design Dash post “Our Tips for Implementing A Flexible Work Policy in 2022.” We outline a few legal issues small business owners might encounter when tailoring flexible work policies.
#5 Promote Internally Whenever Possible to Retain Top Talent
Fifth on our list of ways to retain top talent is to promote internally whenever possible. In their article “Employee Retention: How to Keep Your Top Talent in 2022” for Fit Small Business, Charlette Beasley and Jennifer Hartman explain. Hartman and Beasley write small business owners should always “consider the career paths and goals of [their] employees in the context of existing roles.”
By promoting current employees, small business owners not only “boost morale.” This decision can also “be the key to keeping employees engaged, even as their goals and interests develop.” When employees know they will be rewarded for hard work, they are “more likely to participate in corporate events, training sessions, and other activities.”
Plus, promoting from within can “foster a greater sense of loyalty.” This is because employees know that by investing in the company, they are investing in themselves and their teammates. If you need help retaining employees and structuring your organization, we recommend working with a financial advisor and a small business coach. Business coaches help small business owners structure their firms and chart a path forward with realistic goals.
This can include writing up an interior design business plan to make your firm more attractive to investors and lenders. It can also include designing new departments, hiring new employees and reassigning roles to existing team members. You can opt for one on one coaching, go through a business coaching program with other interior designers or attend a small business workshop.
#6 Review Work and Rewards on a Regular Basis
Another way to retain top talent is to consistently review work and reward employees who are especially creative, innovative and effective at their jobs. Recognition goes a long way, but so do bonuses and pay raises. In her article “How to Calculate and Improve Employee Turnover” for Business News Daily, Skye Schooley agrees.
Quoting Sue Andres from KIS Finance, Schooley writes that “’it’s essential to keep your pay and benefits under review.'” This is one of the few ways to ensure the package you offer each employee is competitive in the current market. Andes tells Schooley that when employees believe managers no longer “‘recognize their worth and true market value,'” they begin to look elsewhere.
#7 Provide Learning Opportunities to Employees
One of our core values at Laura U is that we are committed to lifelong learning. We offer leadership training and workshops at the studio, while making sure our team attends markets annually. It’s important that our team continues to learn and hone their craft.
Providing employees with learning opportunities is key to setting them up for future success in your company. It is also vital to retaining talented employees. Referencing a LinkedIn survey in his article for Houzz Pro, Stephen Rabimov explains. Rabimov writes that “94% of employees would be willing to stay at a company longer if it offered learning opportunities.”
For business leaders in creative fields, this could mean sponsoring employees who wish to attend conferences or design fairs. It could also mean helping employees pay for continuing education courses. Employees feel fostered and inspired, while companies benefit from better-educated workers with up-to-date industry knowledge.
As a business owner, you should also be open to learning opportunities in the form of constructive criticism from employees. Listen and respond to employee feedback. Acknowledge where you can improve in either managing or delegating to employees.
#8 Offer Guidance and Mentorship to New Employees
Similarly, small business owners should find ways to educate employees from within the company. Offering guidance and mentorship is especially important when trying to retain recently hired employees. Not only does mentoring recent hires help retain new employees by reducing confusion and encouraging creativity. It also fosters a sense of connection and community between new employees and other team members.
Of course, there are potential pitfalls when providing guidance to new hires. As the business owner, you might ask a team leader or other senior employee to mentor a new worker. Just make sure your request does not overwhelm their current workload.
#9 Invest in and Foster Your Company’s Culture
In this climate, there is a good chance employees joined your small business because of the positive culture it espouses. Keep employees engaged and encourage a sense of belonging by investing in and fostering your company’s culture. Of course, maintaining your company’s culture and fostering connection between team members can be incredibly difficult when managing a remote workforce. Still, making the effort to maintain a sense of connection is vital for employee retention at interior design businesses.
In their article “Fostering a Culture of Belonging in the Hybrid Workplace” for Harvard Business Review, Tomas Chamorro-Premuzic and Katarina Berg explain. Chamorro-Premuzic and Berg write that “psychological research has consistently shown that when employees feel that they belong…they tend to perform better.” Employees who feel connected to their company culture also “experience higher levels of engagement and well-being.”
To foster your company’s culture, your business plans might include investing in social activities that bring the team together. These activities should help employees “rekindle relationships, feel a stronger connection, and remain an active part of the cultural evolution” of your company.” Consider volunteering together, enjoying a long lunch, planning a retreat or attending a design fair — all during work hours. These types of events an attract new employees too. However, make sure these efforts feel sincere to your employees — not just part of your marketing strategy.
#10 Make Work Purpose-Driven
In their article, Chamorro-Premuzic and Berg note that “the degree of meaning and purpose [employees] derive from work” also impacts retention. According to Berg and Chamorro-Premuzic, purpose is what separates a job from a career. To retain talented employees, Berg and Chamorro-Premuzic write that small business owners must “act as agents of meaning and purpose.”
Writing for HBR their article “6 Strategies to Boost Retention Through the Great Resignation,” Frank Breitling, Julia Dhar, Ruth Ebeling, and Deborah Lovich agree. Breitling et al. write that “purpose is the timeless reason that your organization exists.” In fact, it is the main reason “people join and choose to stay.” Especially true of non-profits, this is also relevant in creative industries like interior design businesses, architecture firms and the arts.
Employees who feel that their work is meaningful and makes a true contribution to the company are more likely to stick around. Quoting Atlanta designer Susan Ferrier in an article for Architectural Digest, Kyle Hoepner elaborates. Ferrier tells Hoepner that her employees look for “‘a sense of place and ownership in the office.'” With this in mind, she tries to provide each employee with the sense that they’re “‘not just working for [her].'” Instead, they are “‘working for [the studio] and their clients.'” They are part of a “‘bigger picture.'”
#11 Delegate Effectively and Avoid Micromanaging
Next on our list of tips for retaining creative employees as a small business owner is to delegate effectively and avoid micromanaging. This is key to general business success too. Susan Ferrier’s suggestion to provide employees with a “‘sense of place and ownership in the office'” touches on this point. Employees are more productive and fulfilled when they can work in ways that make sense to them and best suit their approaches to problem-solving.
Quoting winery-owner Lawrence Sharrott in an article for the US Chamber of Commerce, Andrea Forstadt explains. Sharrott tells Forstadt that “‘engagement starts with empowerment.'” To empower his employees, Sharrott gives them permission to make “‘everyday decisions that get the job done.'” Put simply, Sharrott and other successful business owners trust employees to deliver results. After all, you hired each employee in your firm because of their creativity and unique insight.
To learn how you can let go and delegate without losing creative control, take a look at this blog post.
#12 Celebrate Success as a Team
Next on our list of creative employee retention strategies is to celebrate your firm’s success in the interior design industry as a team. In an article for Houzz Pro, Stephen Rabimov notes that data actually supports this recommendation.According to Rabimov, one study found that companies with a“’recognition-rich culture’ had 31% lower voluntary turnover rates.”
To boost retention, publicly recognize each worker’s contributions and gather together to celebrate major wins as a team. Throw a party for all team members — from your procurement manager to your design assistant — after wrapping a major project. Avoid attributing all success to senior designers and team leaders. Make sure every employee knows that their contributions are valued. The company’s success is their success too.
#13 Update Employees on Upcoming Changes
Keeping employees “in the know” is also important for employee retention — especially in small creative firms. Alert employees to upcoming changes — like an expansion into new markets or a second studio location. Informing interior design professionals on your team not only makes them feel more comfortable and secure.
Bringing employees in on major decisions also fosters connection and makes work feel more purpose-driven. This Bank of America resource notes “’employees have a greater sense of purpose [when informed about] the business’s key goals and initiatives.'”
#14 Find Ways to Support Initiatives Your Employees Care About
Another way to retain employees is to find ways to support initiatives and issues they care about. Set aside time during the year to volunteer for an organization that means something to each employee. If several team members care deeply about the same issue, consider hosting a fundraiser. Just make sure that these initiatives support your company’s mission and core values.
#15 Stay True to Your Mission
Lastly, stay true to your mission! Employees joined your company because of your specific approach. By staying true to your company’s values, you will attract and retain the right employees.
Still Have Questions About How to Attract, Inspire and Retain the Right Employees?
As many of our readers already know, we host small business workshops designed for creative entrepreneurs every few months. These workshops help entrepreneurs scale by figuring out exactly what they want for the future of their interior design firm and how to get there.
Together, we work on setting SMART goals, writing an interior design business plan, and so much more. Over the last year, we have hosted marketing strategy, vision building and hiring workshops, but we are always looking for new topics to delve into.
Do you have additional questions about which employee retention strategies actually work – and why? Let us know if you’d like to discuss hiring, engagement and retention in further detail during a Design Dash small business workshop.
Reach Out to Laura and Other Interior Design Business Owners for Guidance and Great Ideas
In addition to workshops, we offer group sessions and one on one small business coaching services. Join interior designer and business coach Laura Umansky as we address the biggest challenges facing interior design business owners. We work through all these issues on our blog, in our workshops and on social media.
For more small business coaching from Laura and advice from fellow interior designers, join the Design Dash private Facebook group here. You can also answer questions from other small business owners and tell us all about your next great business idea. Your participation will help us continue to grow a community of informed and successful designers!
Whether you own an interior design startup or an established firm, we would love to hear from you. Let’s work together to ensure your successful interior design business thrives like never before in 2023.