Employers appear to be missing the boat in their assumptions about what drives valued talent to seek opportunities elsewhere, judging from new research by consulting firm Towers Watson.
Human-resources professionals at 316 North American organizations identified opportunities for promotion as the top reason (among 23 listed on the survey) that high performers would leave. In a separate study of more than 10,000 employees, work-related stress was cited as the chief factor. Getting promoted was the second item on their list, but work stress didn’t crack the top five on the HR pros’ list.
“It points to a lack of awareness, and a resulting attrition risk that could play out if and when labor markets improve,” says Laury Sejen, global leader, rewards consulting, for Towers Watson. “Coming out of the recession, there’s been a mind-set shift from employees that employers may not have kept up with.”
Yet companies acknowledge they’ve been pushing people to work harder. In the survey, 65% of the HR people said employees have been working more hours than normal over the past three years, and 53% said workers will continue to put in the expanded hours over the next three years.
For some employees, though, stress may derive from sources other than long hours. Compared with the 65% plurality on the HR side that saw people staying at work longer, the same view was held by 57% of senior and middle managers, just 35% of first-line supervisors and team leaders, and 37% of administrative, clerical, and manual-labor workers.
After promotion opportunity, employers figured the next-most-popular reasons for high performers’ exit to be career-development opportunity, base pay, relationship with supervisor, and incentive-pay opportunity. Among the high performers themselves, after work-related stress and promotion opportunity came base pay, trust/confidence in management, and length of commute.
Meanwhile, problems in attracting employees with the critical skills a company needs to compete in its market have surged in the past two years. In 2008 two-thirds of HR survey respondents experienced moderate or great difficulty finding such employees (see chart). In 2009 the figure fell to just 28%, with companies instituting hiring freezes and seeing few employees create job openings by leaving.
Last year brought a big comeback for the critical-skills shortage, followed by another increase in 2011. “It’s getting dangerously close to where it was before the financial crisis,” says Sejen.
At the same time, the difficulty of filling all employee openings remained at a historically low level for a third straight year. “There is actually a risk when you’ve got very little pressure at the all-employee level,” Sejen observes. “You can take your eye off the ball and assume there will be plenty of talent available whenever you need it, and that may not prove to be the case at that time.”