The leading job site and global hiring resource, Indeed, has released research revealing the scale and economic impact of unfilled vacancies on the UK economy. According to the research unfilled vacancies are costing the UK economy a staggering £18 billon per year.
As the UK economy and labour market grows we are seeing falling unemployment and the creation of new jobs. However this means that employees are now more likely to change roles and organisations as they look for a change in career, a new challenge or a move from a role or organisation where they are unhappy. In fact a survey by the Institute of Leadership and Management (ILM) has revealed that 37% of UK workers planning to leave their current job in 2015.
In justifying the £18 billion per year figure the report highlighted that unfilled vacancies have a impact on both the business and the economy. When a role becomes vacant recruitment costs are incurred, and production or service delivery slows which reduces profits. Meanwhile unearned wages reduce consumer spending which contributes to continuing economic growth.
Retention is the way forward
The report’s findings highlight why staff retention is critical to business success. Due to the unstable economic environment staff retention has received little attention as employees seek to keep the jobs they have. But with the shift in economic circumstances employers are now identifying that staff retention is an important issue that needs to be addressed if they are to grow and thrive.
The key to staff retention
Unfortunately there isn’t a one-size-fits-all magic bullet to employee retention. The variables that affect retention in your organisation will depend on your business culture, industry, values and the individuals who you employ.
However there are a number of issues that cause staff to leave, or indeed to stay, and none of them should be a surprise to management:
- Opportunities for career advancement
- Remuneration/pay and benefits
- Efficient planning and decision making
- Knowing how the business is performing
- Recognition of achievements
Managers need to get to know their employee on an individual basis, only by doing so can they work with them to find opportunities for career advancement and suggest benefits that will improve their particular circumstances. Open and transparent communication from senior leaders is often lacking in many organisations, which results in employees feeling that they do not know why decisions are made and how the organisation is performing against management expectations and their competitors.
Traditionally organisations do recruitment interviews and exit interviews, but not interviews whilst the employee is employed by the organisation. Yes, businesses do performance reviews but they tend to be backwards looking rather than looking at the relationship between the employee and the organisation.
What you can do
There are a number of activities you can undertake to improve your employee retention and stop your best performers jumping ship, which include:
- Offer individual talent management programmes to help the career advancement of your employees and for succession planning.
- Offer benefits that your employees want and will find useful.
- Implement a regular employee motivation and engagement survey to highlight any issues.
- Give your employees business briefings including the performance of the business and why key decisions have been made.
- Offer competitive salaries by benchmarking.
- Implement retention interviews to ensure managers get to know their employees whilst they are still employed in the business.
In many organisations salary budgets are still tight so they need to focus on other factors in order to keep their staff, only by doing so can they continue to grow and outperform their competitors.