The Wall Street Journal reports that many recruiters have begun to warn that firms risk losing certain overqualified employees if the economic rebound picks up speed. What's happening? They argue that many people took jobs for which they were overqualified, or at a pay rate substantially below their previous job, during the recession. They chose that perhaps suboptimal employment opportunity because they faced limited options during the downturn. Now, they want promotion opportunities and/or better pay, or they may look elsewhere as the economy recovers.
What can firms do about these overqualified employees who may bolt for the doors in the next year or so? Naturally, it would be great to promote them immediately or pay them more, but these may not be economically feasible options for some firms. What else can these companies do to retain this talent? First, the companies might think about lateral transfers for that employee. No, it's not a promotion, but it could be a great developmental opportunity and a substantial challenge for the employee. They might be tasked with taking on a new role in a different business unit, and they may find that stimulating and interesting. Second, the companies might sit with these employees and chart out a future career path with milestones in the months and years ahead, showing them how they can achieve promotions in the future provided the firm improves its performance and the employee achieves certain objectives. Third, the company can think about investing in other educational and development opportunities for the employee. Employees may be more willing to stay if the firm is giving them opportunities to participate in various leadership development programs that the firm offers. Finally, the firm might consider giving the employee more autonomy over how they do their work. Research shows that employees value autonomy, and that it increases intrinsic motivation. Providing more autonomy might also improve retention for these overqualified workers.