The public sector’s talent retention challenge

How can a talent drain be avoided?

Although global governments are increasingly conscious of the value of skills, the UK’s public sector workforce has been hit hard by austerity. Job losses, low morale and pay freezes have all fuelled concerns of a potential talent drain.

The public sector is doing more with less, especially when it comes to its workforce.

Since 2010, its headcount has gone down by over 400,000 - a 7 percent drop in the workforce. Estimates suggest the figure could fall twice as far - to 800,000 - by 2020.

But with increasing value being placed on skills, employers need to think carefully about how job cuts, wage freezes and weak morale could lead to a talent drain.

Managing cuts
A survey of public sector staff for Totaljobs reveals that it’s not just the volume of workforce cuts that is potentially problematic.

Respondents felt that the individuals who were retained by their employers often had less to offer than those who had left:

  • A third felt that retaining highly-skilled talent during cutbacks was handled poorly
  • A similar proportion thought the opportunity to let underachievers go was badly handled
  • Researchers concluded that talent had often left organisations, while employees with inconsistent performances had stayed

Reviewing employee attitudes
So how can leaders in the public sector keep hold of talented staff when cuts need to be made? And how can they make sure they aren’t losing vital knowledge that will be needed in the medium to long term?

The Civil Service People Survey monitors feedback from staff across Whitehall, and the Scottish and Welsh Governments. It gives a candid picture of how the civil service is perceived by those within it.

The most recent survey found:

  • Civil servants have a clear view of their organisations' objectives and their contribution towards them
  • They are interested in their work
  • They enjoy a strong sense of accomplishment

This is all good news when it comes to retaining and attracting talent, as the Deloitte Millennial Survey suggests that 6 in 10 millennials choose employment that gives them a sense of purpose.

However, the survey also reflects issues with pay and rewards:

  • Just 28 percent of civil service employees were happy with the standard of pay and benefits they received
  • Only 24 percent were satisfied with their level of pay compared to people doing similar jobs in other organisations

Separate Deloitte research across Europe has found that low pay limits the talent pool available for government finance positions, and NAO studies have concluded that for government procurement experts, pay is insufficient. These are just 2 examples of highly-marketable skill-sets where public sector pay might not compete with the wider jobs market.

Talent retention efforts
The civil service has been keen to focus on skills development in recent times.

The Major Projects Leadership Academy (MPLA) was launched in 2012 to address self-observed leadership capability gaps within the civil service. The MPLA, managed by Deloitte and the Oxford Said Business School, has helped 350 civil servants develop their skills and confidence so far.

Meanwhile, in 2013 the civil service launched a plan to strengthen skills across 4 key areas:

  • Leading and managing change
  • Commercial skills and behaviours
  • Delivering successful projects and programmes
  • Redesigning services and delivering them digitally

Identifying leaders of the future
According to our analysis, current skills initiatives should be supported by a wider shift in expectations of civil service and public sector leaders.

We've identified a suite of core abilities and behaviours - rather than individual skills - that will mark out the strongest leadership talent in the future. They include:

  • Adeptly connecting people, information and resources to deliver through complex networks
  • Operating with a default level of transparency towards colleagues and citizens
  • Using social media to continually engage with colleagues and citizens
  • Making decisions informed by evidence
  • Testing out innovative thinking using iterative processes

The impact of automation
Along with talent retention efforts, automation may have an impact on the public sector workforce in the coming years.

Deloitte-commissioned research by Oxford academics Carl Frey and Michael Osborne has revealed that certain public sector roles, such as library assistants and local government administrators, have a high probability of being automated over the coming 10-20 years.

However, other roles within the public sector will continue to rely on the perception, creativity and social intelligence of humans. These include frontline roles like teaching, policing and firefighting.

Our opinion
Factoring in all these issues, our study - The State of the State - recommends that the public sector should:

  • Consider medium-term plans when making headcount reductions, so talent and skills are retained
  • Recognise the importance of rewards in attracting and retaining talent
  • Focus on new abilities and behaviours as well as individual skills when identifying future talent
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