HR Managers Concerned about Workforce Retention
Over two-thirds (70%) of HR managers say worker retention is a primary concern and 40% report that turnover has increased in the past 12 months. And if employee retention is a current business challenge, long-term demographic trends are sobering.
According to Retention Strategies for 2006, a study by Monster Inc., an online career and recruitment source, 55% of HR managers expect workforce retention to be a high to very high challenge for their organizations in the next five years. Other key findings:
Over the 50 years between 1950 and 2000, the U.S. workforce added 79 million workers, according to the U.S. Bureau of Labor Statistics. In contrast, between 2000 and 2050, American businesses are expected to face a decrease in the available workforce. This is due, in part, to a proportionately smaller generation of talent replacing baby boomers who are retiring or transitioning to part-time roles.
One possible scenario is an expanding economy constrained by a slower growing workforce. This could produce excess demand for talented workers and drive up recruiting costs.
"Businesses of all sizes and across all industries must develop—and implement—creative programs and strategies to attract and hire top candidates while retaining and motivating current employees," said Jesse Harriott, vice president of research at Monster. "As the talent pool shrinks, it's imperative that immediate action is taken to ensure businesses are properly prepared and staffed for the future."
Monster's survey showed that more than 75% of HR managers believe compensation is one of the top three reasons why employees leave. HR personnel plan to use salaries and benefits as a primary lever to retain workers.
While compensation is important, not all companies can deliver this competitive advantage. They must also create a comprehensive plan that will inspire worker loyalty and commitment. Strategies that HR managers are using include:
This article was prepared by the staff at the Point for Credit Union Research and Advice and is published online at http://thepoint.cuna.org/. Reprinted with permission.
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