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Released today, the 2016 Staff Retention Report (SRR), has uncovered staff retention as an increasing concern among Australian businesses. The findings come from analysis of the Australian Institute of Management’s (AIM) 2016 National Salary Survey (NSS) released earlier this year, which revealed four in five Australians are unhappy at work.
Developed to take a deeper look into current market trends around staff retention and the impacts of staff turnover, the 2016 SRR found more than half (54.6%) of businesses across Australia are currently concerned about staff retention, up from 48.8% in 2015.
Internally, the negative impacts of staff turnover present a potential threat to business, with reports of increased stress, reduced staff morale and loss of corporate intelligence affecting the remaining workforce. Other effects include reduced customer service, satisfaction and productivity, in addition to the financial burden of recruiting and training new staff.
However, insights from this year’s study suggest there are several HR strategies and approaches that can be considered, to help organisations achieve below-market average resignation rates.
David Pich, AIM Chief Executive Officer, encourages business leaders to reassess their current pay model and suggests creating a positive and inspiring workplace culture, to help decrease staff turnover and retain human resources.
“Retaining staff is no easy feat. Employees can become restless in roles that have limited career advancements or where they don’t enjoy their time at work. To motivate and engage staff, managers and leaders need to understand the motivations of their employees and implement strong tactics to keep valuable team members,” Pich said.
The AIM National Salary Survey was analysed to identify specific human resources strategies to assist companies develop and retain good talent, with the aim of reducing resignation rates to lower than market average of 10.3%.
The report shows the key reasons employees are leaving jobs by choice is to look for a new challenge, better training and development opportunities, or to seek improved recognition in a role; all of which outweighed financial reward and highlighted the importance of non-financial retention tactics.
While the report covers a number of tactics an organisation can employ to keep staff, one area of note is the growing importance of Corporate Social Responsibility (CSR) as socially-conscious Generation Y become a larger portion of the work force.
The average resignation rate recorded for organisations that have formal CSR policies in place is lower than that recorded for organisations that either have informal policies or don’t have any CSR policies in place, according to the 2016 AIM National Salary Survey.
The most significant decreases in resignation rates in 2016 compared to 2015, were recorded in the wholesale – machinery/auto – industry (decreasing from 13.9% to 10.6%) while the Business & Professional Services industry recorded the highest resignation rate overall, with a record figure of 15.4%. When broken down by financial turnover, the most significant decrease in 2016 resignation rates has been recorded amongst companies with an annual turnover of over $200 million, falling from 13.7% in 2015 to 11.3% in 2016.
Yet organisations with an annual turnover of $5 million to $10 million recorded the highest resignation rates overall in 2016, at 12.6%.
To engage and motivate employees, and to maximise retention strategies, employers need to take a proactive approach to understanding what motivates their employees and what human resource policies and practices make their organisation more appealing than their competitors.
“People don’t leave companies; they leave leaders. Great managers and leaders make decisions that impact people’s lives and that impact can be felt well beyond the workplace. We spend about a third of our working-age lives doing just that – working. So, it is vital our experiences in the workplace are positive as they impact on our overall well-being and on society as a whole,” added Pich.