Firms must “double down” on retention efforts amidst resignation crisis

Accountancy practices should seek to counteract spates of resignations through non-traditional retention methods and more effective articulation of their employee offerings, according to senior industry sources.

“Now more than ever, businesses must double down on their employee retention efforts,” said Kevin Hogarth, chief people officer at KPMG UK.

“[Firms must] clearly articulate what they have to offer, whether it be career progression, alternative career pathways providing a new challenge, learning and development or establishing greater flexibility around how and where people will work in a post-pandemic world.”

Dubbed as ‘the great resignation’, a number of sectors have endured a mass exodus of talent in recent months as the impacts of the coronavirus continue to wane.

Research from Reed, for instance, found that half of UK workers are prepared to leave their roles in order to access hybrid working benefits.

Similarly, recent data from Microsoft shows that 41 percent of people are likely to consider leaving their jobs within the next year.

Alastair Woods, people and organisation partner at PwC, offered some rationale for this, arguing that a “fresh start” is what many employees are seeking post-pandemic.

“People [are] rethinking what they want from life. With the supply pressures, consumer price inflation and inflationary pressures, there are people looking for ways to increase their income.

“Moving jobs is the quickest way to do this and with many companies in growth mode, there are more jobs around than ever.”

Woods also added that the increasing skills gaps and consequent wage inflation could impact margins and “make some businesses unviable”.

In addition, the financial strain of turnover itself is likely to be a concern for firms during this period, with lost productivity and processes such as hiring, onboarding and training all tending to bear significant costs.

Research by Oxford Economics and Unum, for instance, found that the average cost of turnover per employee (with an annual salary of £25,000 or more) is at least £30,000.

“High turnover of people and failing to attract new talent poses a number of threats to all organisations,” said Justin Rix, head of people advisory at Grant Thornton UK.

“Not just from the tangible cost of recruiting to fill the gaps when people leave, but also from the impact this has on productivity, the loss of knowledge and skills, the impact on customer experience and relationships, and the added pressure on the remaining workforce, which in turn can fuel further turnover.”

Increased retention efforts critical

With wider organisation health seemingly at risk, a number of market participants have said that a shift in people management strategy is vital.

Amanda Digne-Malcolm, director of practice at the Institute for Chartered Accountants in England and Wales, argued that greater flexibility is critical in the effort to reengage and retain personnel.

“Post-COVID, flexibility is a deal-breaker for many people, so employers must have good flexible working practices in place to retain staff,” she said.

“For some people, a decent work-life balance is even more important than having a higher salary. The temptation to move jobs will be exacerbated for those who value a work-life balance and who see people in more senior positions working long hours.”

Rix offered a similar view, arguing that the pandemic merely accelerated an already growing penchant among employees for more tangible purpose and values from their employers.

“It’s never been more important for organisations to focus on their culture and employee wellbeing to ensure an inclusive environment that supports how and where their employees want to work,” he said.

“Even before the pandemic, there was a greater focus and want from employees to relate to the purpose and values of their place of work. Businesses need to ensure that they are embracing the change in ways of working and are using the opportunity to adopt new, more flexible working practices for the longer term.”

There also appears to be a growing consensus around the importance of professional development and career opportunities, particularly among younger workers.

PwC research, for instance, found that 35 percent of millennials cited ‘excellent training and development’ programmes as a key characteristic of an attractive employer.

In addition, 22 percent ranked training and development as their number one most valuable benefit.

According to Gerwyn Davies, public policy adviser and senior labour market analyst at the Chartered Institute of Personnel and Development, this is a critical area in an organisation’s retention effort, and strong leadership is key to executing this.

“Training helps retain the best and brightest talent, and leaders and management are central figures when it comes to staff retention, coaching and resolving conflict,” she says.

Gerwyn also notes that the importance of training applies to managers themselves in this situation. If they are properly equipped, they will more effectively engage and retain staff, she argues.

“Management is a fundamental cause of people leaving jobs, and ongoing training is vital to ensure the right leaders and management are in place, playing a key role in staff resilience and wellbeing.”

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