The changing technological landscape, dynamism in societal expectations and exhilarating employee demands are some of the top factors contributing to the changing rule of operations in today’s corporate world. New generational younger leaders with plethora of self starting entrepreneurial option are often smarter and willingly ready to respond to these new demands of the embracing growing mobile workforce.
To keep pace with the coherent changes, organizations need to try building or maintain their competitive advantage through an engaged workforce by fostering innovation while attracting and retaining talent. And in order to not get caught off guard, every industry leader must stay on top of the current best practices and future trends that will help you become a better employer. Setting the context straight, here are some insights based on the current workforce perception on attrition and what actionable plan must leaders look in to prevent their performers drifting away.
What’s the current workforce perception on attrition
Have you heard these reasons from your colleagues and friends who plan to quit from their respective organizations:
- My work did not give me enough growth and satisfaction.
- I was not respected, my manager didn’t understand me.
- I didn’t get paid well and wanted a competitive pay hike post my appraisal.
Gartner’s Global Talent Monitor surveyed how employees and job seekers around the world feel about various reasons starting from economic perspective, to their personal prospects and what motivates them, or doesn’t, when it comes to work. The quarterly survey is a reflection of the insights pulled from vast data drawn from responses of more than 22,000 individuals in 40 countries with the objective to understand labor market trends. This also captures how employees and job seekers around the world feel about the economy, their personal prospects and what binds them at work.
As per the latest Global Talent Monitor from Gartner’s 4Q18 data, there’s an increase in discretionary effort by employees in the intent to stay which is coupled with employees’ willingness to go above and beyond at work. Breaking a five-quarter downtrend, the encouraging curve has both increased across all geographies at the end of 2018 and rose to 8.0% from 7.5%.
However, when it comes to employees’ perception of job opportunity and their confidence in the business environment; there’s a downward trend as 27.2% of the workforce come under active job seekers list. And the top three drivers of attrition evident from the data are career development opportunities, compensation, and people management. So, what must leaders plan in order to prevent their performers drifting away? Let us look closely at some trends to retain your employees in this year of 2019.
Merit-based plan will remain prominent to create a value-driven Competitive Pay Structure
Compensation is among the top three drivers of attrition. Many employers make the mistake of thinking that their employees are fortunate to have a job with them and hence lose focus on competitive pays. Even the ‘so-assumed- happy’ employees could be swayed with competitive offers. More than 35% of 18-34-year-olds ranked compensation as the top motivating factor to leave their job in one of the global surveys.
Another research report by Pay Scale also reflects that while 81% of organizations are planning base pay increases in 2019, the average increase isn’t expected to change much from 2018, with 69% of employers estimating an average increase of 3% or less. Hence in 2019, companies are dependent on retention tactics based on merit-based pay plan (being used by 61% of organizations), learning and development opportunities (59%), and the discretionary bonus plan (34%).
In 2019, organizations see career development as their biggest investment area
Recent research states that one of the most common reasons for attrition is a lack of professional advancement opportunities. Rarely an employee joins a company thinking, ‘I am going to be here for just two years.’ Employers need to invest in employees to retain them for a long term keeping career development as one of the biggest agenda. Majority of employees think that their companies are not able to provide a real career growth.
This trend is clearly seen more among those lower on the corporate ladder as they feel the need to look outside their company for career progression and to make more money. With a strong desire to tackle new challenges every few years, career development is one of the biggest drivers for people wanting to move. Employees constantly need new challenges, even those who aren’t in line for a promotion. HR Leaders need to find ways to offer new opportunities to their people at all levels through a transparent mechanism.
Effectively managing a diverse pool will no more remain a choice, but a necessity
In 2019, organizations plan to use 17% more contractors than in 2018 and expect a 27% increase in remote positions. Moreover, the current full-time workforce is getting both younger and older. With such a mix of mindset working together with diverse need, managing the workforce with a touch of personalization is set to become a challenge. For instance, some prefer work in a traditional office setting and the other segment of newer generation craves to work in modernized office settings such as open-concept, virtual, or co-working offices. It becomes obligatory to set new rules for leaders to strike the right chord for keeping such diverse talent pool engaged throughout for retaining them.
Let’s face it – An era of high-touch generation and at the same time higher predictability of shorter employee life cycle.
Organizations need to finally start preparing for it as complacency may be an employer’s worst enemy. So, begin with helping your employee base to understand total investments that are being made on them with a fresh perspective in the light of trust, fairness, and competitiveness. Ensure every employee knows the impact they make on company goals, and empower them to drive results. Make them feel wanted and align their values for institutionalizing retention from the grass root level.