Blog Article

The talent exodus: why now is the time to protect your business

Posted by David Smith

David Smith

Have companies become complacent about talent retention in the last few years? Yes, there will always be those technical specialists or company superstars that are wrapped in cotton wool, but what about the others? Are we investing less in the rest? Let’s look at the evidence. Recent CIPD data suggests just one in nine organisations anticipate an increase in learning and talent development funding in the next 12 months, pay increases are limping around below inflation in most sectors, and Hay Group research, ‘How to stop talent taking flight’ shows employee engagement has stagnated.

It’s clear to see how this has happened though. Economic conditions in recent years have not exactly helped drive much action in the talent market. In times like these people don’t necessarily want to change jobs and so although there’s complexity in the recruitment market, staff retention has arguably slipped off the to-do list.

However, there’s a growing sense that this situation might be changing. The CIPD’s recent Resourcing and Talent Planning survey data indicates that 78 per cent of companies are worried about staff retention now compared to just 55 per cent in 2010. Hay Group research, conducted in association with the Centre for Economics and Business Research recently suggested UK companies are facing a talent exodus in the coming years with turnover levels forecast to rise sharply in 2015, resulting in 765,000 more departures than in 2012.

So with a storm approaching, is now the time to increase the focus on retaining top talent?  An analysis of our global employee opinion data has identified five factors that differentiate ‘stayers’ (those committed to the company for more than two years) from ‘leavers’ (those planning to leave in two years or less). These factors are:

  • Trust in company leadership – Do your employees feel they work for a well led organisation that is heading in a positive direction? This requires leaders to communicate the company strategy clearly, consistently, regularly and with authority.
  • Environment for success – Employees don’t just need to be engaged but also need to feel well equipped and enabled to do their jobs effectively. This means placing people in the right jobs, creating efficient work processes, enabling collaboration and providing a supportive work environment.
  • Authority and influence – Employees that feel trusted and empowered to make key business decisions are more likely to feel engaged in their role.
  • A fair exchange – Workers that feel valued are more likely to be stayers. Is there a fair balance between the contribution they make and the reward and recognition they receive?
  • Room for growth – Most employees want to reach their full potential at work. Employees want to know there are opportunities for them to learn, grow and progress.

Investing time and effort in some of these areas will not only help you hold on to your best people but you’ll ensure that they’re more productive, too. Whether it’s financial success, customer satisfaction, performance or retention, Hay Group research suggests that an investment in employee effectiveness can drive tangible results.

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