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Employers worry about top employees taking their talent elsewhere 

By Neil Amato 
June 29 2012

Employers in some industries are having a hard time finding the right people to fill vacancies. Increasingly, they’re fretting about keeping the key talent they have. As the economy improves, organisations that are looking to grow or restock their ranks will compete aggressively for top-notch employees – and that could prove costly for companies that don’t have retention strategies.

That’s according to Retention of Key Talent and the Role of Rewards, a survey of 526 human resources professionals from a variety of industries released this month by WorldatWork, a nonprofit that focuses on compensation and benefits.

Fifty-six per cent of respondents said that the retention of key talent – employees who are the strongest performers, have high potential or are in critical jobs – has become more difficult in recent months, and the same percentage said they expect top employees to search for better jobs as the economy improves.

Retention is now a major concern of senior management, the majority of respondents (65%) said. About half (51%) of the survey respondents are confident their organisation can retain key talent as the economy improves.

Companies that have retention programmes tend to keep key talent by offering above-average pay and benefits such as flexible scheduling, the survey showed.

Most companies have such retention plans, but their effectiveness varies. Seventy-four per cent say identification of key talent is the most effective step. Offering pay above the labour market (73%), allowing flexible hours or telecommuting (69%) and discussing future opportunities with the key talent (67%) also ranked among the most effective strategies.

The survey also addressed the reasons employees leave:

  • More money at another job (32%).

  • Lack of promotional opportunities (24%).

  • Feelings that pay levels are unfair relative to others outside the company (21%).

  • Workloads are too heavy (19%).

  • Work-life balance issues (19%).

  • Concerns about the direction of the organisation and its leaders (18%).

  • Feelings that pay levels are unfair relative to the employee’s performance and contribution (17%).

  • Lack of training and developmental opportunities (17%).

As the global economy has limped along, employees have become more frustrated because, even if they retain their jobs, layoffs have made their work more difficult and, in some cases, reduced benefits, such as a 401(k) match, the report says.

Long term, talent shortages could limit companies’ ability to expand and compete, the report says, as a result of older workers retiring, increasing specialisation and technical demands of jobs, global competition for talent, and education systems not keeping up with business demands.

Related CGMA content:

Neil Amato (namato@aicpa.org) is a CGMA Magazine senior editor.

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9 Comments


Comments
GregoryZipperer

Agree with the above comments.  Unfortunately the  reality is that most employers are reactive by nature so these things will occur.

Jul 27, 2012 6:35 PM
Comments
John Bond

Good article

This represents reality.  A lot of organisations are having to cut back on resources to survive and save costs in the current climate.  As a result, employers place greater reliance on key staff to undertake more tasks, with little reward.

Key employees believe they are treated unfairly with additional work and no recognition.  Yes, we are lucky enough to be in employment however there needs to be balance.  The threat of key employees growing increasingly frustrated by the lack of opportunity with additional workloads will ultimately force these staff to look elsewhere.  Intellectual property will follow if other employees can not fulfil key employee roles if / when they move on.

Jul 27, 2012 5:14 AM
Comments
Manuel Munoz

If inner mobility is limited because of politics, cronyism, nepotism, etc., talented staff will leave.  Employers who do not "grow their own" can of course hire outside talent. These outside hires are usually paid higher but termination rate is also high.  Thank you''s can only go so far.  Hardworking employees also need rewards monetary or otherwise.

Jul 6, 2012 5:29 PM
Comments
Kimberly Reidy - Zumdieck

I agree that talented employees  are not all motivated by the same thing.  However, I think talented employees are more apt to leave if they see their boss as incompentent in running the business and do not consider utilizing the talent within the company to help run the business.  Bosses that try and make all the decisions disregarding those working for them may find themselves running a failing business.  Additionally not respecting their employees has a negative impact as well.

Jul 6, 2012 5:16 PM
Comments
JosephThomas

Employees will jump ship when their expections are not being met.  Each of us is motivated by different factors.  This is one of the things that makes us all individuals.  Some, money, others recognition, still others opportunities for advancement, exposure, ???  The best way to retain top talent is to understand their individual likes and dislikes, and maximize their likes while minimizing their dislikes.  Cookie-cutter approaches do not work in the longrun.

Jul 6, 2012 2:40 PM
Comments
DerrickBennett

I believe there are always several factors, but I would like to add that talent will leave when their input and skills are not appreciated.  More individuals are leaning away from money and toward job fulfillment.  

Jul 6, 2012 10:45 AM
Comments
Kieuchinh Tran

Talented employees will not stay with incompetent and untrusted leaders. Without respects to their leaders, employees are not willing to go the extra mile, and perform their best.

Jul 6, 2012 8:32 AM
Comments
OliviaEspinoza-Riley

Talented employees are frustrated by management decisions that recruit managers without the proper background and knowledge to do the work.  It seems some hiring decisions of under performing managers is influenced by personal preferences rather than the needs of the Organization.  Usually, the employees are asked to make concessions and to find a way to make things work for the best.

Jul 6, 2012 7:59 AM
Comments
SuppiahSubramaniam

I am of the view that top talent also leave an organization when they do not enjoy an amicable working relationship with their superiors as at times superiors do become an hindrance to talented staff  rather than being supportive and encourage them in pursuit of knowledge and skills.

Jul 6, 2012 1:41 AM
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