career progression, compensation, and recognition are top factors leading to turnover
With many economies around the world gaining momentum, labor markets continue to tighten and workers with highly sought-after skills are on the move. Randstad Award 2015 research reveals IT professionals are more inclined than any others to look for a new opportunity.
In fact, 18% of IT workers polled in the survey changed employers in the past 12 months, and another 20% say they consider seeking new employers in the coming year. As a result, retaining critical talent and keeping overall employee turnover in check have again become a top priority for businesses in 2015.
Organizations that don’t understand the real cost of employee turnover pay a hefty price. Hard costs associated with recruiting a new employee, including candidate sourcing and interviewing as well as hiring and onboarding, are just the tip of the iceberg. Some less obvious costs can quickly rack up and eventually hurt your company’s bottom line, including potential productivity losses, a drop in sales, a loss of institutional knowledge, and a negative impact on customer satisfaction.
Here’s a question for HR leaders: as competition for critical IT knowledge and skills heats up, do you have a sound retention strategy in place to keep your business moving? More importantly, does your retention strategy clearly reflect your employees’ needs and motivations?
Below are the top three factors driving IT employees to switch employers and approaches businesses can embrace to address each of these retention challenges.
factor 1: lack of career prospects. For nearly one in four (24%) IT professionals, a lack of career prospects is the primary reason for leaving a company. Our research also confirms that when making an employment decision, career progression opportunities play a more important role for IT professionals compared with other professions. Have you provided your key employees with clarity about their future with the company? When mapping out the steps they can take to achieve their career goals, don’t overlook the opportunities for lateral career moves. Consider how you can enable your employees, especially those in the early stages of their careers, to acquire new skills as well as learn about other businesses units in your company.
factor 2: low compensation. Eighteen percent of IT professionals say they seek new employers because their pay expectations are not met. Fast-growing economies in Asia and Latin America see the greatest motivator for workers to switch jobs is for a bigger paycheck. Today’s talent, especially those with the most in-demand skills, is more informed than ever about the salaries paid for the same position across multiple companies. To keep critical employees committed, HR leaders need to work with industry specialists to benchmark your pay and benefits against the market and ensure your compensation strategy remains competitive.
factor 3: lack of recognition. A lack of recognition was cited as another major reason (18%) why IT professionals change employers. Since the vast majority of managers know the importance of recognizing employees for jobs well done, why is employee recognition still a persistent management issue leading to turnover? I think the underlying cause is that some of the recognition schemes fail to hit the sweet spot.
If you constantly receive feedback from your employees saying they feel under-appreciated at work, it’s time to review their expectations and make sure your recognition programs are well-aligned. And keep in mind that the best recognition doesn’t always have to come with a price tag: in most cases and maybe to your surprise, a positive note from a manager telling employees they did a great job is enough to “make their day.”
In short, to retain your critical IT employees and drive high performance, a sound retention strategy will ensure they are excited about their career prospects, fairly compensated, and valued at work.
But even if your retention strategy has checked all the boxes, there’s still a chance your critical employees will leave. When the impact of high employee turnover on your business goes beyond what your in-house HR capacity can possibly manage, outsourcing your recruitment process or part of it could be the solution.
Working with a good recruitment process outsourcing (RPO) partner enables you to meet your time-critical, large-scale hiring needs and therefore can keep the impact of employee turnover on your business to a minimum. Another benefit of using an RPO partner is they help you proactively address the turnover issue by using high-performer data and insight to inform the recruitment process so best-fit candidates are hired from the start.
So if high turnover among IT professionals is putting a strain on your company’s bottom line, developing a thoughtful recruitment and retention strategy well-attuned to the motivation of your employees and engaging specialist external partners could be the answer.
Request the full range of the Randstad Award 2015 reports now to gain more insights into the key drivers motivating the employment decisions of today's talent and who are the most attractive organizations to work for.