Treating Inclusivity as a Differentiator
“Many people take a pay cut to work at small companies, so we have to use inclusion as a differentiator.”
“Employees are going to remember how their companies treated them during the pandemic.”
One of the more common colloquial statements we heard both through this research, and the past years of covering corporate social responsibility (CSR) efforts generally, is that today’s employees care more about a company’s mission and non-business activities than ever before.
In addition to millennials’ changing attitudes towards work, much of that has to do with labor market realities. Inflation-adjusted wage growth for all but the highest wage earners has been flat over the past four decades. So, even in times of low unemployment (like most of the 2010s), employees have been conditioned to consider non-salary based reasons when selecting a potential employer—when a choice is offered.
In the current economic environment wrought by COVID-19, that conditioning is going to be considerably tested.
Employers, who are growing and hiring, will have no issues finding labor at the price they want. Will under- and unemployed individuals continue to care as much about a company’s mission when unemployment is historically high? Or wages are falling?
It is too early to tell, but most of the small businesses we talked to are betting that for the most part, employees still will. They are optimistic that the investments they’ve made in their communities will pay dividends, and there were certainly plenty of examples that it had —from a massive increase in gift certificate purchases from customers to employee efforts to strengthen the company “off-the-clock.”
The expectation is that the good will that smaller (and all) businesses have engendered with their employees and customers through their community citizenship and inclusivity practices will be paid back in terms of loyalty or positive sentiment. Anecdotal evidence is promising, but whether that holds in the long-term will be vital to their success. If the labor force or the consumer market becomes more sensitive to wages and prices, large companies will pay more than small companies for talent and customers. Using inclusivity as a differentiator will remain an important distinguishing characteristic for small businesses moving forward.