While nearly half 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). The findings for our Retention Strategy and Execution Pulse Survey are now available to members.
According to the study findings, which are now available to i4cp's corporate members, 47% 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%) 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 upticks, just 20% of organizations reported they have increased their retention efforts. However, among higher-performing companies, 27% said retention efforts have increased, compared to 17% of lower performers.
Regarding a budget for retention efforts, 23% of companies overall admit they don't have one, while 43% say their budgets have remained about the same. Twenty percent of higher performers said they don't have a retention budget, while 25% 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% of companies overall conduct face-to-face exit interviews to learn what led employees to leave the organization, but only 17% take action to address those issues from a "high" to "very high" extent. Among higher performers, 65% conduct exit interviews and 20% take action, while lower performers do so at 77% and 16%, respectively.
"It seems that many companies may be dropping the ball when it comes to retention issues," said 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% of respondents said they don't regularly review their retention strategies and programs. In higher-performing organizations, that number drops to 32%, while 51% of lower performers said they do not review the strategies/programs.
So, how effective are organizational efforts to retain talent? Overall, 48% of companies believe their efforts are "somewhat" or "highly" effective. The employee segments are headed up by senior managers, 56% from a "high" to "very high" extent, followed by employees in critical roles (41%) and high performers, also at 41 %. In general, 62% of responding companies said they have made an effort to identify specific talent to retain, and HR was cited by 30% has having primary responsibility for that task.
Download the Retention Strategy and Execution findings now.