As a talent professional, if you’re feeling a bit like Sisyphus, the Greek mythological figure eternally condemned to rolling a boulder uphill only to watch it roll back down, you’re not alone. Recruiters, hiring managers and others in need of talent are battling higher staff turnover rates thanks to growing talent scarcity and skills gaps. So even if your employee retention efforts are robust, you still may not have the resources needed to fuel business growth. Human Resources Online reported that double-digit employee turnover rates in most APAC markets are increasing year-on-year.
so what does this mean for your company, and how can you enhance employee retention?
Jim Stroud, Global Head of Sourcing and Recruiting Strategy at Randstad Sourceright said, “Employee retention has become so critical to a company’s talent strategy that it’s considered the new recruitment function. Since competition for in-demand skills is fierce – not just from direct competitors but also employers in other industries – companies are doing all they can to hold on to their best people.”
“With economies around the world gaining momentum, you’re seeing jobs go unfilled for longer and longer periods of time. As a result, recruiters are aggressively focusing on attracting passive candidates, which makes retention more difficult.” he added.
significant costs of turnover
A study conducted by Harvard Business Review and ICM Unlimited found that a company with 10,000 employees and a bad reputation need to offer about USD 4,723 more per hire to convince candidates to take the job.
Have budgets been set aside to incentivise your employees in the face of growing competition for talent in your organisation? Even if more money isn’t available, have you considered other ways to retain your best employees?
Let’s take a look at some fundamental steps for achieving this.
aligning employee value proposition (EVP) to talent preferences
Companies that do a great job at retention understand the desires of their employees and make sure to align their EVP accordingly. Unfortunately, many employers don’t do this well and find out only when it’s too late. Often, they believe an employee’s decision to leave is based mostly on money but in reality, compensation and benefits are only the fifth most often-cited cause. What is the number one reason for talent to leave? According to a survey conducted by Work Institute, employees leave to look for better career development opportunities.
While pay is important, many employees in today’s environment want to know their employers offer a path for career growth, Stroud points out. “They want both financial rewards and the satisfaction that comes from a job that will challenge them and help them feel fulfilled professionally,” he adds.
Indeed, in the 2017 Randstad Employer Brand Research conducted in 26 markets with more than 160,000 working-age adults, career progression opportunities ranked among the top five attributes workers look for in an employer. Coincidentally, this attribute was the fifth-most associated with the largest companies in the markets.
Where most large companies fail to align their EVP to employee desires is around offering an attractive salary and providing a pleasant work environment (these two qualities didn’t even crack the top 10 that workers associate big enterprises with).
How can you align your EVP to the desires of your workforce? Here are three practical tips to beef up your employee retention strategies.
1. stay competitive in the market
While money isn’t the leading reason that drives employees to leave, you also can’t reward staff significantly lower than the competition does. Conduct regular salary surveys for key roles and stay up to date about prevailing pay rates. If you are at parity, you probably won’t lose talent for this reason. Conduct competitive intelligence gathering to ensure other components of your compensation offerings (e.g. medical insurance, retirement benefits and others) are on par with what your competitors are offering.
2. clarify a path forward
Having better career opportunities is the number one reason for employees to leave. Therefore, it is critical to make sure that your line managers are equipped to help employees achieve a clear view of their future with the organisation. Some managers may selfishly want to retain a star performer in a role for longer than necessary, so remind them that they risk losing talent to a competitor, resulting in a valuable resource who may work against you. In addition, consider mentorship programmes to engage with high-potential employees, which will further help them envision a long career with your company.
3. create good work-life balance
According to the Randstad Employer Brand Research, work-life balance is one of the top three most-desired employer attribute across Southeast Asia. In an article published in the Harvard Business Review, Lori Goler, the Head of HR at Facebook, explained the company’s best managers create career opportunities that “mesh with personal priorities.” Understanding the stresses that your employees undergo and the sacrifices they make to their personal lives should be a critical undertaking for your organisation. By capturing insights on how these demands could potentially force workers to leave, it allows you to develop mitigation plans. As Goler writes, “People leave jobs, and it’s up to managers to design jobs that are too good to leave.”
about randstad employer brand research
Celebrating its 18th edition globally, the awards based on the outcome of the Randstad Employer Brand Research are presented each year to the most attractive employers in 30 markets across the globe. It is the most representative and inclusive employer brand research in the world.
The outcomes are based on public perception and focus on three main areas: overall brand awareness, absolute attractiveness and relative attractiveness. This creates a level playing field for all competing companies instead of giving an advantage to large multinationals with higher name recognition than the smaller companies. The awards are not open for nomination and the results are based solely on the opinions and votes of the local workforce – making it the only award that is truly representing ‘the people’s choice’.
The 75 largest companies were selected in each participating market, usually with more than 1,000 employees. This list is presented to a representative cross section of respondents based on region, age and gender. The respondents were asked to identify companies they recognise and indicate if they would like to work for them. This was then followed up with an evaluation of attractiveness factors, such as salary, benefits, work atmosphere and job content and more, for each of the companies.
Stay tuned to find out who Singapore's most celebrated employer brand will be.