New research from Personio suggests that businesses are sleepwalking towards a costly talent exodus, with four in ten employees (38 per cent) looking to change roles in either the next 6 or 12 months – or once the economy has strengthened – rising to 55 per cent for 18-34 year olds. Person have said businesses need to prioritise their people as they emerge from the pandemic, or risk paying the price.
The research – based on a survey of 500 HR decision makers and 2,002 workers across the UK and Ireland – finds that while nearly half (45 per cent) of employers are worried staff will leave once the job market improves, only a quarter (26 per cent) state that talent retention is a priority for their organisation over the next 12 months – suggesting many are leaving themselves vulnerable to huge costs.
In fact, economic analysis reveals that, overall, the cost of additional staff turnover over the next 12 months could amount to an estimated £16.9 billion toll on businesses in UK and Ireland – equating to £10,076 per business – with SMEs alone facing estimated costs of up to £5.8 billion.
When it comes to reasons for leaving, the research uncovers a worrying disconnect between employers’ perception of what will encourage their staff to leave and their employees’ reality. Whilst employers are right to believe that a pay freeze or cut (28 per cent HR decision makers vs 22 per cent employees) and a worsening work/life balance (20 per cent HR decision makers vs 23 per cent employees) are key factors that could cause workers to look elsewhere in the near future, they drastically underestimate the pushing power of toxic workplace culture. Almost twice as many employees than HR decision makers consider toxic workplace culture to be a significant push factor (12 per cent HR decision makers vs 21 per cent employees).
For employees looking elsewhere, the top two most influential factors forcing them to look elsewhere in the next 12 months are a lack of career progression opportunities (29 per cent) and appreciation for the work they do (29 per cent). However HR decision makers believe these factors to be less significant, with only 17 per cent and 15 per cent stating lack of career opportunities and appreciation to be push factors, respectively.
Indicative of a broader disconnect that could be contributing to a lack of loyalty amongst employees, the research also finds that employers believe they have supported teams better than employees suggest they have. HR decision makers are over twice as likely as employees to rate their business’s support for career development as ‘good’ (64 per cent HRDMs vs 30 per cent employees), and more likely to see its support for work / life balance (70 per cent HRDMs vs 53 per cent employees) and mental / physical wellbeing (68 per cent HRDMs vs 44 per cent employees) in a positive light.
Hanno Renner, co-founder and CEO of Personio said: “The last year has been a challenging one for businesses and HR teams who have often found themselves ‘firefighting’, dealing with multiple new tasks and concerns. For some, this has caused other areas such as people strategy to fall to the wayside – but this negligence comes at a cost. Falling out of touch with the workforce’s problems and priorities means that not only could people be more frustrated and ready to resign, but employers will be poorly prepared to prevent people leaving – resulting in lost talent and productivity, and damaged employer brand.
“As businesses look to emerge from this crisis in a position of strength and turn the tide on the costs of a potential talent exodus, they now need to come up with a long term people strategy,” Renner adds. “By prioritising their people and taking a more strategic approach to people management, employers can prevent an impending talent drain and drive their business performance as well as the wider economy.”
