| November/December
2003
Can
all those surveys be wrong?
THERE’S
SURPRISING DISCONTENT AMONG THE ‘HAPPILY EMPLOYED’
WATCH
OUT for increasing employee turnover as the economy improves.
That’s the inescapable conclusion of survey after survey
and web poll after web poll.
On a
basic level, it’s intuitive that a stronger economy
would embolden employees to seek alternatives to their current
job. Risk declines, while the opportunity for reward increases.
But the
people most responsible for employee welfare – human
resource professionals – may be underestimating the
depth of unrest among today’s so-called “happily
employed” workers.
64%
Very Likely to Seek New Jobs
In a
newly released survey from the Society for Human Resource
Management (SHRM) and The Wall Street Journal website CareerJournal.com,
only 12 percent of HR professionals believe that increased
turnover is extremely likely as the economy improves and the
job market strengthens.
That
is in sharp contrast to the 64 percent of employees queried
in the same survey who said it is extremely likely they will
look for new jobs.
However,
when “somewhat likely” responses are added to
the “extremely likely” ones, a majority of both
HR professionals (56 percent) and employees (a whopping 83
percent) see the probability of increased turnover ahead.
The SHRM/CareerJournal
results are not that different from a web poll conducted earlier
this summer by Sanford Rose Associates, which found 58.7 percent
of respondents stating they were likely to leave their current
employers, while another 20.4 percent were undecided.
The fact
is that a large percentage of employees just don’t like
their jobs. A year ago, SRA Update reported on a Conference
Board study that showed only 51 percent of all workers to
be satisfied with their current job, falling to 47 percent
among those aged 35-44 – the prime years for entry-level
management positions. One year later, in a web poll of nearly
2000 executives from 60 countries, conducted by Korn/Ferry
International, only 38 percent of those currently employed
expressed any level of job satisfaction. The remaining 62
percent were somewhat or very dissatisfied.
Even
if surveys of this nature are skewed toward active and passive
job-seekers, as opposed to employees at large, the results
show an unprecedented level of job dissatisfaction.
Job
Dissatisfaction Has Several Causes
What
drives employees to leave?
In the
SHRM/CareerJournal study, employees were provided a list of
20 possible reasons for changing jobs and asked to check all
that applied. Slightly over half chose better compensation
and benefits, while about a third each chose career development
opportunities and “ready for a new experience.”
Over a fifth selected job security fears.
In Sanford
Rose Associates’ web poll for September, respondents
were asked to choose which one of four issues requires the
most employer attention: employee cash compensation, employee
benefits, retiree benefits or job stability. The last received
58.3 percent of the vote, followed by cash compensation at
25.0 percent. (Job stability’s stronger showing in the
SRA poll probably stems from a focus on workplace improvements,
as opposed to personal reasons for changing jobs.)
So how
do employee attitudes jibe with reality?
Throughout
most of the corporate world, salaries have flattened and in
some cases been reduced. Likewise, salary increases occur
at less frequent intervals and for smaller amounts. And with
the prospect of prolonged unemployment looming over almost
everyone, those with jobs have tended to remain in them until
the marketplace improves. With little resulting turnover,
career-development opportunities have slowed.
Thus,
complaints are real, and – in a global society that
increasingly expects instant gratification – they have
become the itch one needs to scratch.
Can
Loyalty Be Re-kindled?
Employers
face three interrelated challenges:
- First,
they must address the root causes of employee dissatisfaction
or suffer the consequences of ever-widening employee alienation.
Not all organizations of course have the same problems,
and some may have none, so careful diagnosis should precede
treating any disease.
- Second,
they must help employees understand that the late-20th-century
phenomenon of changing jobs every 3.5 years or less was,
like skyrocketing stock prices, unsustainable. The quid
pro quo for greater employee loyalty is, of course, greater
employer loyalty to employees.
- Third,
they need to re-think how long they can continue to make
do with less. Today, most companies have trimmed away the
fat and now run the risk of cutting through the meat and
into the bone. If that happens, productivity is guaranteed
to decrease and turnover to rise.
While
hiring in general and new job creation in particular may lag
other portions of the economic recovery, there is widespread
agreement that job openings in the next few years will exceed
the availability of people to fill them – the result
of an aging population. As one economist said recently, “Demographics
don’t lie, especially when they deal with people who
are already born.”
Therefore,
if employers don’t take steps to reduce predicted employee
turnover, they may well face a double whammy: departing workers
and declining replacements.
“Offshoring”
– the movement of certain service-sector and manufacturing
jobs from developed countries to lesser-developed ones –
may provide some relief in functional areas such as call-center
operations, information technology and low-tech manufacturing.
Over time, however, the law of supply and demand will tend
to drive up prices – neutralizing the benefits of a
workforce halfway around the globe in a much different time
zone.
Likewise,
in countries with flexible retirement laws, some employees
may choose to stay beyond normal retirement age. However,
in the August SRA web poll, as many respondents (26 percent)
said they are likely to retire before age 60 as said they
would retire past age 69 (24.9 percent).
The
Executive Search Perspective
In good
times and bad, executive search consultants stay in touch
with a broad range of employers, not to mention a large pool
of past, present and future job candidates.
Some
firms, such as Sanford Rose Associates, specialize in particular
industries and occupational segments and thus are a very good
source of comparative information about the employment marketplace.
As that market heats up, how well will your organization do
in retaining the employees it needs to keep and in attracting
new ones who can make a difference in bottom-line performance?
In the
words of Entrepreneur magazine, “At the moment, employers
control the job market, able to hire and fire employees as
they see fit. But employer-friendly job markets don’t
last forever, and the next labor crunch could be even worse
than the one seen in 1999… [L]eaders at all levels should
wake up. Talented people are treasures, and you’d better
figure out a way to keep them.”
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