While nearly half of companies surveyed admit the economic downturn has slowed the drain of employees, that doesn't mean companies are effectively addressing ways to retain workers when the situation improves, according to the latest study by the Institute for Corporate Productivity (i4cp).
According to the study findings, which are now available to i4cp's corporate members, 47 per cent of polled organizations said the current economic doldrums have had a "somewhat" or "significant" positive effect on employee retention. However, when asked what will happen when the economy rebounds, less than half (46 per cent) of companies said they are concerned about retention to a "high" or "very high" extent.
When it comes to trying to keep employees on board when the economy improves, just 20 per cent of organizations reported they have increased their retention efforts. However, among higher-performing companies, 27 per cent said retention efforts have increased, compared to 17 per cent of lower performers.
Regarding a budget for retention efforts, 23 per cent of companies overall admit they don't have one, while 43 per cent say their budgets have remained about the same. Twenty per cent of higher performers said they don't have a retention budget, while 25 per cent of lower performers admitted they do not have one.
In addition, when employees do leave, the study suggested that many companies may be missing the "why" retention boat. For instance, 68 per cent of companies overall conduct face-to-face exit interviews to learn what led employees to leave the organization, but only 17 per cent take action to address those issues from a "high" to "very high" extent. Among higher performers, 65 per cent conduct exit interviews and 20 per cent take action, while lower performers do so at 77per cent and 16 per cent, respectively.
"It seems that many companies may be dropping the ball when it comes to retention issues," says i4cp senior research analyst Carol Morrison. "They've identified retention as a concern, but they're not willing to fund programs for it. And, they are losing out on opportunities to find out why employees are leaving. Clearly, more attention to retention issues is going to be needed as the economy improves and turnover inevitably increases."
Of those organizations which have a plan in place, 44 per cent of respondents said they don't regularly review their retention strategies and programs. In higher-performing organizations, that number drops to 32 per cent, while 51 per cent of lower performers said they do not review the strategies/programs.
So, how effective are organizational efforts to retain talent? Overall, 48 per cent of companies believe their efforts are "somewhat" or "highly" effective. The employee segments are headed up by senior managers, 56 per cent from a "high" to "very high" extent, followed by employees in critical roles (41 per cent) and high performers, also at 41 per cent. In general, 62 per cent of responding companies said they have made an effort to identify specific talent to retain, and HR was cited by 30 per cent has having primary responsibility for that task.
The Retention Strategy and Execution Pulse Survey was conducted by i4cp in November of 2009. The full results of the survey are available exclusively for i4cp corporate members.
With more than 40 years of experience and the industry's largest team of human capital analysts, i4cp is the definitive destination for organizations seeking innovative ways to improve workforce productivity. For more information, visit http://www.i4cp.com.