In recent years, poor economic conditions provided one modest comfort for employers: With unemployment high in many places and jobs scarce, companies mostly held on to their employees, partly because nobody else is hiring.
But signs of a return to global economic growth are a harbinger of a global talent exodus, according to a new survey report by global management consulting firm Hay Group and the UK-based consultancy Centre for Economics and Business Research.
Worldwide employee turnover has been flat in recent years, but it is set to rise in 2014 with 161.7 million workers expected to leave their jobs, a 12.9% increase over 2012. Turnover is expected to accelerate in subsequent years and reach 192 million by 2018.
“The turbulent labour market associated with the economic downturn has held down turnover rates in many firms,” Hay Group senior principal Mark Royal said in a news release. “But as the economy recovers and global employment becomes less volatile, dissatisfied workers are a significant flight risk for organisations across the world.”
Experts have been warning employers not to ease up on their retention strategies. In the fall of 2012, Deloitte human capital specialist Robin Erickson said workers were taking a wait-and-see approach toward leaving their current jobs and would be looking for new employment when the economy improved.
That time may have arrived. Heavy talent departures are expected to start in emerging markets, with Asia-Pacific experiencing its largest increase in employee turnover levels in 2013, according to the survey. Turnover levels are expected to spike most in Latin America in 2013 and 2016, with infrastructure spending and investment rising in part because the World Cup soccer tournament in 2014 and the Summer Olympics in 2016 will be held in Rio de Janeiro.
Turnover is expected to spike in North America in 2014, and European countries will be the last to see increased turnover, according to the report.
Retention strategies will be critical in this environment, and the Hay Group indicates that five key factors are among the most consistent predictors of employee engagement and commitment. Employees who plan to stay with their company for more than two years rate their employers more than 20 percentage points more favourably on these factors than employees who plan to leave within two years.
These factors are:
- Confidence in leadership.
- Opportunity for career development.
- Supportive work environment.
- Appropriate compensation.
Royal said retention is a growing concern for core employees as well as key high-performing employees.
“Understanding the factors that drive commitment and loyalty is essential for managing increased turnover risks in the months and years ahead,” Royal said. “Now is the time for organisations to understand where they stand … and tackle these influences to keep employees from taking flight.”
—Ken Tysiac (email@example.com) is a CGMA Magazine senior editor.