Banks and Credit Unions have reached a pivotal moment.

As labor shortages continue to grip the economy and workers reassess what’s important to them, financial leaders are looking for new strategies to engage talent and combat what is being called the ‘Great Resignation.’

According to the U.S. Bureau of Labor Statistics, over 4 million Americans quit their jobs in December 2021. While employee retention is actually improving in the financial sector, finding and keeping the right talent remains a challenge (Crowe, Bank Compensation and Benefits Survey, 2021).

In moving forward, the first step is to understand why financial employees resign, then examine specific strategies banks and credit unions are using to attract and keep the talent they need.

Following are three key reasons employees leave financial service jobs, along with proven strategies for overcoming these challenges.

1. Promotional Opportunities and Career Development

Frontline employees such as tellers and contact center agents are a critical part of any bank or credit union. These employees are essential in creating a positive, professional image as they foster relationships, solve problems, and recommend the right products to meet customer needs.

Customer satisfaction and retention hinge on the performance of frontline employees, yet entry-level positions, specifically teller jobs, have been the most difficult roles to attract and retain across the banking industry (Crowe, 2021).

Higher pay increases could be expected to alleviate this challenge, although pay might not be the largest factor. Employees often cite a lack of career development opportunities as a significant reason for leaving the financial services industry.

Professional development is essential to retain skilled employees. Studies consistently show that turnover decreases when employees take advantage of the growth opportunities available within the organization.

Regions Bank took this approach with their branch associates. When the bank transitioned to a universal banker model in their branches, they cross-trained all personnel to provide a complete array of services for customers. Their customers liked the change because they could rely on one person to assist with all their financial needs. Employees also liked the transition because they had a chance to expand their skill sets and have a greater opportunity to assist customers (ABA Banking Journal, 2020).

Regions’ investment in their employees paid off, resulting in improved service levels for their customers and higher retention for their employees.

“It creates a career path for associates that they may not have seen before. So we’ve seen greater job satisfaction, we’ve seen reduced turnover as a result of that and just overall better outcomes and environments in the branches.”



PROVEN STRATEGY:  Financial centers that invest in continuous training and professional development see increases in employee engagement and retention – which translates to better service for customers.


2. Compensation and Talent Loss to Competitors

With financial services turnover reaching an all-time high in 2017, the competition for quality candidates remains fierce. Though retention rates are now improving, peak turnover rates have left a lasting impact on the industry, adding upward pressure on salaries.

The recent decrease in turnover rates may be due in part to financial institutions offering higher pay and more attractive benefit programs. Yet, the salary for many frontline jobs is still comparatively low.

According to the Bureau of Labor Statistics the salary range for tellers was $26,000 – $33,000 in 2020. The range for contact center agents was similar. Typically, nonofficer roles bring home less than $35k annually. Considering the complexity of financial services jobs, frontline employees may feel tempted to leave the industry or to look for a more attractive wage with another financial center.

With salaries trending upward and qualified individuals becoming more difficult to retain, how do industry leaders compel their employees to stay without breaking the budget?

Many banks and credit unions have seen greater retention by increasing the flexibility in work schedules and fostering a supportive work culture. Offering professional development, as mentioned earlier, also goes a long way in boosting employee satisfaction and loyalty.

When it comes to compensation, banks and credit unions are instituting annual incentive plans that use common earnings measures to gauge performance and reward employees accordingly. Thought leaders suggest that these types of performance-based programs are the ideal pay strategy for influencing stronger performance and improving employee morale. Not only can financial leaders invest in their highest performers with an incentive program, but the program also reinforces alignment with strategic goals and fosters continuous improvement.

“Banks are investing in their people and have taken steps to improve retention and their recruiting efforts by offering better benefits, more flexibility and higher raises.”

(Cited by Banking Exchange, 2021)


PROVEN STRATEGY:  Stand out as a great place to work with performance-based pay strategies and offer benefits and perks that set you apart from competitors.


3. Job Fit and Finding the Right Talent

Finding and keeping the right talent for evolving financial services jobs isn’t easy. Some new hires may lack the technical and service skills needed to succeed in the new role, resulting in frustration and poor service. Others might feel over-skilled for the job and quickly lose interest and motivation.

In either case, poor job fit negatively impacts performance and retention – and ultimately damages the customer experience.

As the scope of financial jobs broadens, successful banks and credit unions are shifting greater focus to their hiring and onboarding practices. Smart HR leaders are updating job descriptions and embracing new technologies to accurately predict which job candidates are likely to excel and remain in the job.

Two key trends impact this effort. First, there is an increasing need for traditional tellers to be redeployed in new roles such as universal bankers (McKinsey’s Global Banking Annual Review, 2020). Second, financial centers are quickly transitioning to a multi-channel approach, requiring tech-savvy customer service reps and e-reps to respond to increasingly complex customer needs.

To be successful, financial centers must update their staffing strategies to match these evolving needs. Deloitte recommends utilizing experiential learning techniques like simulations to assess and train employees (Deloitte, Banking and Capital Markets Outlook, 2022). Simulations give job candidates and employees an opportunity to demonstrate job-specific skills. They also ensure better job fit by providing a realistic preview of the job and assessing candidates on actual job tasks.

Consider the success of First United Bank and Trust. The bank implemented our EASy Simulation for Universal Bankers in their screening process to help transition their staffing model from traditional tellers to relationship advisors. This engaging process yielded more quality interviews and successful hires for First United.

“The new process creates the ultimate filter to make sure we have the right people.”



PROVEN STRATEGY:  Stay proactive by employing innovative hiring technologies that target critical success factors required of today’s financial services jobs.


Put Our 30+ Years of Experience to Work for You!

For over three decades, it’s been our honor to collaborate with leading banks and credit unions, helping them navigate the rapid changes in the workplace. We’ve designed a full suite of simulations for all key financial services jobs, including universal bankers, tellers, financial center managers, contact center representatives, live chat agents, bilingual agents, and more. If we can assist you in upgrading your talent assessment and development process, contact us here or call 888.332.0648.