The COVID-19 pandemic might have been the catalyst for The Great Resignation, but the shifts it has brought are likely here to stay. Although coronavirus cases continue to decline in the United States and many mask mandates are disappearing, the truth is that it’s a rare business that’s been unchanged by the events of past two years.
Financial institutions, of course, fall into the “changed” category.
Back in 2020, the pandemic necessitated immediate changes for the industry, sending employees home to work and closing branches. But as the banking environment evolves, the workforce must as well.
The Great Resignation, as we’ve shared before, incorporates changes the pandemic wrought, but also touches on wants employees still seek out, such as quality of life and work-life balance. Salaries may be increasing across the board at major banks; for example, at JPMorgan Chase, compensation for investment bankers and traders rose 13 percent last year. Employees in fields such as professional business services and IT received 12 percent increases in pay, on average, according to Time.
And the Financial Brand reports that increasing pay is almost expected among all levels: “Randolph-Brooks Federal Credit Union in Texas—with $14.6 billion in assets—raised their minimum wage to $18 per hour, well above the state’s minimum of $7.25. In Michigan, where the minimum wage is $9.65, Michigan Legacy Credit Union (with $269 million in assets) raised its hourly rate to $16.”
Salary bumps could even last for years across the entire economy, but that’s not the only criteria current and potential employees are seeking these days.
How the pandemic changed—and is still changing—work
About 47 million people quit their job last year, according to CNBC. For comparison, 42.1 million people quit in 2019—at the time, considered the tightest labor market on record. Joblist’s 2022 Job Market Trends Report shares that three out of four employees are planning to quit their job this year. And 79 percent of employed job seekers believe they can make more money by switching jobs than staying put in the current market.
So, money is still very much a factor. But it’s only one factor. In a Gartner survey, 65 percent of those surveyed said the pandemic was making them rethink the place that work should have in their lives. Other desires included a focus on employee well-being, remote or flexible work schedules, social impact, and professional development opportunities.
How area financial institutions are managing the changes
Back at the start of the pandemic, banks and credit unions had to make changes overnight. And while community banks by their nature cannot be completely online, it did provide a kickstart to evaluating things such as processes that could be done remotely.
Remembering spring 2020, Jason Ginsberg, senior vice president, director of bank operations at Union Savings Bank in Danbury, Connecticut, says, “We examined things rapidly and thought about what could get done outside the bank and if there was anything we could outsource, while ensuring processes were still being completed and that controls were in place. Certain operational functions tend to be paper-oriented, and as paper disappears, you need to create new functionalities and ways of documentation and review—which creates opportunities. For example, we turned wire originations into a paperless function.”
Jim Rusiecki, executive vice president, director of treasury management and operations at Northwest Community Bank, in Winsted, Connecticut, agrees. “We had to shift gears quickly, like everyother FI in the country. But we fared well under this test. We were able to get remote work happening quickly and efficiently, to our and our customers’ benefits. It was a challenging time, but the industry was able to step up for those who count on us.”
Like with any business evolution—or even revolution—the banking industry must adapt to these changes, or risk getting left behind. After two years of a pandemic, bankers note that you simply can’t conduct business the way you used to. “For years, we have pushed electronic banking and online tools. Now, even the people who were initially resistant have jumped right in,” Rusiecki adds.
Of course, no financial institution can be 100 percent remote, and there were employees who needed to go into the office, even in the early days of COVID-19. Ginsberg comments, “I wished I could have everyone remote, but branch and certain back-office staff didn’t have the option. Our goal was to make everyone feel comfortable and appreciated when they needed to be onsite.”
Ginsberg pointed out that his bank has helped manage employee anxiety, safety concerns, and overall processes by spreading out fewer in-office employees over a larger space. And they’ve continued to re-evaluate the processes that need to be completed in the office and those which can be handled out of it; Ginsberg explains about 85 percent of operations functionality can be managed remotely, such as electronic payments, loan operations, HSA, and IRA functions.
Currently, they use a hybrid-work model; some employees are in the office every day, others are all remote, and others are a mix of remote and on-premises. Employees can also opt for flexible work arrangements, allowing them to do tasks such as pick up their children from school and then work from home for the remainder of their workday.
“If someone is in a role that’s not remote-capable, that’s not going to change unless their position changes. But flexibility is something we can do and still operate the business,” Ginsberg says. “It’s key to maintain the culture of a community bank.”
Keeping employees happy—and knowledgeable
In addition to flexible work arrangements, employees have been making ongoing education and advancement opportunities a priority. As employees think about what they want next, they realize they want to learn. So, providing people the ability to grow and advance benefit both organization and employee, providing purpose and knowledge. Employees want to be challenged by their work. They desire to learn something new. They may want extra responsibilities. Or a new role.
The pandemic inspired opportunities to learn at Northwest Community Bank, says Rusiecki. “Being a community bank, we had specialists in various areas, so we took the opportunity to get ahead of any spikes in COVID cases to make sure we had adequate cross-training. Staff got opportunities to learn multiple areas within the department. Getting experience with new things gives them the opportunity to be better-rounded employees for future advancement,” he explains.
Overall, employees would like the ability to attempt something new—and not be penalized for it. Even if it means not succeeding, employees still want to try things out with an employer who buys into taking risks and understands a “fail fast” mindset that’s conducive to innovation. They want to be valued for piloting new things, because it makes them feel like they have a stake in a purpose-driven organization. For example, Harvard Business Review cites how the businesses that were making steps toward being future-prepared had an advantage when the pandemic hit. An organization is only as innovative as the people who work there.
Culture is crucial
The Great Resignation isn’t so much a period of time as it is a mindset. And it’s often not one specific issue that leads to a resignation. Receiving encouragement to try something new, or fail, or seek out work-life balance—those are simply part of the whole culture makeup of a workplace and influence employee satisfaction and retention.
Being that many FIs are already doling out increased salaries and bonuses, promoting a flexible or hybrid workplace, and providing opportunities to grow and learn, what separates one company from another?
It comes down to culture, says Rusiecki.
“Are there growth opportunities? Are you investing in your employees? Do you promote from within?” Because you are selling the culture of the organization. It’s intangible, but that’s where every industry and company can differentiate themselves,” he adds.
For ways NEACH can support your team’s professional development, consider our upcoming Payments Management Conference (in-person and virtual options available) or visit our online course directory.
AUTHOR: Joe Casali, AAP, NCP
Executive Vice President
As the EVP of Payments Innovation for NEACH, Joe focuses on exploring innovative solutions and technologies that will help position members for success, both now and in the future. Connect with Joe to read more of his blogs, articles, and posts.