The U.S. job market is relatively strong. As recently as April 2023, the unemployment rate was 3.4% - tied for the lowest levels in more than 50 years. The Class of 2023 is entering the most robust market for new graduates in 70 years.
Yet it feels different. The Federal Reserve is struggling to curb inflation, the once-robust tech sector has shed hundreds of thousands of jobs, and many companies are still reeling from the dual shocks of COVID and the Great Resignation.
It's time for businesses to rethink how they approach the employee experience and reimagine how they share their brand story with candidates. This means taking a look at your employee value proposition (EVP), the part of your employer branding strategy that represents everything of value that your company has to offer its employees. It's vital to think beyond traditional pay and benefits to career development, company culture, flexibility, and mentorship.
Job seekers were in the driver's seat during the Great Resignation, and although the job market is strong, the economy is slowing. Job seeker agency is not as hot as it once was, and employers are hesitant to expand as they hunker down in anticipation of a recession. The terms companies can offer in the new employee-employer contract will become part of their employer branding, so it's important to evolve accordingly and explain your brand offerings effectively.
What is an employer value proposition (EVP)?
Harvard Business Review divides EVP into four classes of perks:
- Material offerings: Compensation, physical office space, location, commuter benefits, computer equipment, flexibility, schedules, and perks
- Opportunities to develop and grow: The ways an organization helps employees acquire new skills and become more valuable in the labor market
- Connection and community: The company culture and benefits that come from being part of a larger group
- Meaning and purpose: The company's aspirational reasons for existing; the answer to the core question of why employees do the work they do
Between 2018 and 2020, compensation, work-life balance, and stability were the top three EVPs globally, but what matters most to workers started shifting in 2020. After the pandemic-causing global shutdowns and social justice protests, workers' desire to work for companies that reflected their values heightened. They also wanted to make remote work and hybrid schedules a permanent perk. For a while, most companies obliged, but remote work has become less common as return-to-work mandates have increased.
Rethink pay and material perks
Employees want to be fairly compensated for their work, but the pay alone is not enough to retain top talent. Any company with deep pockets can get into a bidding war for a great worker, but culture and career development aren't as easily matched. A 2021 Gartner survey found that 94% of employees say it's more or equally important now than before COVID-19 to develop skills outside their roles, but Gartner also found that 45% of employees are leaving their current employers for better professional development opportunities. Offering growth opportunities such as a structured mentorship program, for example, gives an employee the chance to learn from someone they would not meet in any other role.
Think beyond the pocketbook, specifically around perks such as branded company swag, luxurious retreats, and on-site meals. When the EVP of a company is limited to cushy shuttles and kombucha, the employer brand is in trouble.
How to evolve your EVP
An employer's EVP will evolve; it's a good idea to update it every 3-5 years so your company's latest offerings continue to reflect your employees' values. Leaders should ask for feedback regularly to understand what works and what needs to improve, and - most importantly - act on that information.
Word of how leaders manage the company's culture trickles down through professional networks like Glassdoor. Almost 50% of job seekers use sites like Glassdoor to research a company as part of their job search: Employee reviews influence which companies job seekers choose and can steer applicants to companies that align with their values.
Beyond setting EVPs, companies should share data to demonstrate the value of their EVPs. For example, if mentorship is part of the EVP, the company could report the number of mentorship pairings it facilitates annually or the number of hours that mentors spend working with their mentees. If on-the-job training is a notable perk, highlight the number of sessions offered, the number of participants, and success stories from those efforts.
"The more that you can use the voice of your associates and lean into that, the more transparent your employer brand will be," Ally Brown, brand manager at VCA Animal Hospitals, said. "For example, through storytelling, we are starting to create more written blogs from our associates, as well as video testimonials and quotes."
Not so fast: Pause and reflect before revising the "terms of agreement"
Stock options don't always materialize. On-site meals and dry-cleaning don't matter during a global pandemic. The foosball and happy hour perks that dominated the early aughts are no longer enough to attract and retain the best workers.
When was the last time your company revisited its employee value propositions? Now, more than ever, employees want to find meaning in their work and connection with their colleagues. If your EVPs no longer align with your employees' principles, it's time to reset to values that reflect the times.