Analysis

Engaged employees are long-term employees

How can mid-market executives address the issue of rising turnover?

Earlier this year, we highlighted the threat of worker defections in a labor market that seems to be growing stronger by the day. New evidence from Deloitte’s latest survey of middle market executives suggest that concern was well-placed.

Engaged employees are long-term employees

July 24, 2015

A blog post by Roger Nanney, national managing partner for Deloitte Growth Enterprise Services, Deloitte LLP

Earlier this year, we highlighted the threat of worker defections in a labor market that seems to be growing stronger by the day. New evidence from Deloitte’s latest survey of middle market executives suggest that concern was well-placed.

The survey of more than 500 mid-market executives found that nearly two-thirds have noticed an increase in voluntary staff departures.

While worker retention is increasingly on the minds of companies big and small, the issue is particularly acute for midsized firms. That’s because mid-market companies sometimes don't have the same resources (financial or otherwise) or the same flexibility as larger firms when it comes to replacing employees. As such, with fewer employees on board and closely-knit cultures that have come to characterize this segment of the economy, midsized companies tend to have a bigger void to fill every time an employee leaves.

So, how can mid-market executives address the issue of rising turnover?

One of the issues we see in the market is that, too often, companies approach these episodic bouts of voluntary departures by focusing on “hold people here” strategies. In our experience at Deloitte, we have found that a sole focus on retention may be misplaced, because it assumes that workers decide whether to “re-up” or not on a fairly irregular and predictable schedule.

The truth of it is, we live in a different world now. The proliferation of social media and web-based recruiting tools have granted workers a new level of access to job opportunities. People are constantly making choices, conscious or not, about their commitment to their work and employer.

That’s why, now more than ever, companies should be focused on engaging employees rather than simply keeping them on board. My colleague Josh Bersin, a leading workforce analyst, believes that businesses can make themselves “irresistible” to workers by doing things like providing meaningful work and growth opportunities, having managers focus on coaching and cultivating talent, helping employees balance their work-life needs, and generally creating a work environment that inspires people to contribute. I full-heartedly agree. I know what it’s like to wake up every day and feel energized by what I’m doing and by the people around me.

The best businesses today are finding ways to continually monitor, encourage and tap into their employees’ enthusiasm for their work. If your business doesn’t fit this description, it may be time to make the necessary changes so it does.

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