Employee loyalty is a rare commodity


By Samantha White

Employee loyalty is an increasingly rare commodity, according to a survey of senior US business, HR, and management professionals.

The research conducted by the American Management Association (AMA) found that 52% of managers considered their employees to be less loyal than they were five years ago. Just 11% considered employees to be more loyal.

The larger the company, the more acute the issue becomes. In organisations with more than 1,000 employees, 61% of respondents considered staff to be less loyal now, compared with 2010.

The impact of dwindling loyalty to organisations was clear to respondents. Low morale was the most commonly identified consequence, cited by 84%, followed by high turnover and disengagement (each cited by 80%), growing distrust amongst colleagues (76%), and lack of team spirit (73%).

Companies have much to gain from initiatives that promote engagement. For instance, 33% of those polled believe that the degree of loyalty found in an organisation has a direct relationship to profit levels.

“Devoted employees know the business and focus on the job. There’s less alienation and more engagement. It aids people at all levels, because loyal employees work with the best interests of the organisation in mind and help protect the team,” Sam Davis, an AMA vice president, said in a news release.

In spite of the issue’s significance, addressing it is not yet a priority for the organisations polled. Just 20% describe employee loyalty as a major focus.

Three key factors in fostering loyalty

The AMA identified three areas that are essential to fostering loyalty amongst the workforce: providing fair remuneration, a healthy working environment, and opportunities for development.

“Coaching, job skills training, and learning opportunities show that the company is serious enough about employees to invest in their future,” Davis said. “Managers should engage employees in decisions about their work and give input into the how, why, and what they do.

“This will go a long way to help employees become more personally invested, interested in the outcome, and intrinsically rewarded by their work.”

Related CGMA Magazine content:

37% of Workers in UK Survey Say They Plan to Change Jobs in 2015”: A survey by the Institute of Leadership & Management shows that 37% of workers plan to switch jobs in 2015, up sharply from previous years. One-quarter of workers looking to leave say they feel underappreciated, and most who plan to leave are seeking greater career progression.

Companies Aware of, But Not Acting on, Need to Alter Engagement Strategies”: Most companies are aware of the need to focus more on employee engagement, but few say they are doing enough to adapt to coming changes, according to a global report by Hay Group.

Samantha White (swhite@aicpa.org) is a CGMA Magazine senior editor.

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