Survey Says: Loss of Trust Driving U.S. Workers to Seek New Jobs August 26th, 2010

Heather McCulligh

There’s been a lot of discussion lately about workers “jumping ship” as the economy improves.

A new study from Deloitte shows some unsettling trends as to why employees are looking for new jobs. The 2010 Ethics and Workplace Survey finds that employees have lost trust in their employers.

According to Deloitte LLP’s fourth annual Ethics & Workplace Survey, one-third of employed Americans plan to look for a new job when the economy gets better. Of this group of respondents, 48 percent cite a loss of trust in their employer and 46 percent say that a lack of transparent communication from their company’s leadership are their reasons for looking for new employment at the end of the recession. Additionally, 65 percent of Fortune 1000 executives who are concerned employees will be job hunting in the coming months believe trust will be a factor in a potential increase in voluntary turnover.

The study goes on to discuss the importance of talent management and retention strategies:

“With lack of trust and transparency factoring into the employment decision of roughly half of the respondents who plan to job hunt in the coming months, business leaders must be mindful of the importance of both on talent management and retention strategies as well as the bottom line impact,” says Allen. “By focusing on these two areas executives may be able to reduce attrition. It could also allow them to mitigate the expenses associated with the hiring and on-boarding process and ensure that tacit knowledge remains within their organizations. Establishing and reinforcing a values-based culture will ultimately help to can help cultivate employee trust.”

The study provides an interesting data point for HR pros and makes a compelling case for improving talent management practices, as well as ensuring executives are involved. If companies haven’t been focused on engagement, development and retention efforts even when times have been tough, they will be hard pressed to provide a good reason why a top performer should stick around when things improve. It’s not hard math to look at the costs of acquiring and onboarding a suitable new candidate, and the loss of corporate memory is also expensive.

Without executive buy-in to the process, it is going to be difficult to improve employee trust in the organization since that is one of the key areas where the communication breakdown is occurring. This post from Sean over at Fistful of Talent also provides some insight on how goal alignment plays into employee buy-in to the talent management process.

How much of a threat do you think lack of employee trust is to your organization? Have you focused on building engagement and continuing development so that your best stick around for the long haul?

Tags: employee engagement, managing in a downturn, retention, talent management

Inspiring Performance - It Takes More than Just Pay August 24th, 2010

Heather McCulligh

A recent survey from Kelly Services found that more than half of all Americans surveyed believe they would be more productive if they had greater interest in the companies that employ them, through benefits such as profit sharing. In previous posts, we’ve established the many benefits pay for performance programs provide when they are done well, but this survey helps to clarify who pay for performance matters to and why.

The survey found 25 percent of workers are currently in an arrangement where some of their pay is tied to performance targets. Gen X (aged 30-47) employees are much more likely to be receiving performance-based pay than Gen Y (aged 18-29) or those in the Baby Boomer generation (aged 48-65). Men are also more frequently in performance pay plans than women.

However, of those not receiving performance pay, almost a third (31 percent) say they would be more productive if their earnings were connected to performance outcomes, particularly Gen Y and males.

The survey demonstrates that pay for performance is most relevant to the younger generation of workers and to male workers. This gives HR some insight into how to position the program, and which groups will not find it nearly as compelling.

Other survey findings that are of interest:

• Aside from salary, the reward that rates highest is health benefits, followed by flexible hours, and retirement benefits.
• More than two-thirds (67 percent) believe that employers should provide incentives to encourage a healthier lifestyle, like programs for quitting smoking, losing weight, or exercising.
• The employer-provided health benefit that is most attractive is health insurance, followed by gym access or discounts, a smoke-free environment, and corporate exercise programs.

All of this reinforces the point that money alone does not motivate workers; compensation and benefits need to be part of a well-thought out and executed talent management and HR strategy. Throwing out bonuses with zero explanation won’t drive productivity, but a solid strategy to engage and inspire employees will. If you want to explore another take on the subject, check out David Creelman’s white paper called “Why Pay for Performance Can Work at Last.”

Great HR leaders understand what motivates different groups of workers and should ensure their companies are offering a wide enough variety of incentive programs that connects with all their employees needs.

Tags: compensation management, employee engagement, pay for performance, talent management