Employee Attrition: Solving the mystery of the disappearing workforce

employee attrition

As the workforce in Australia becomes increasingly diverse, the importance of understanding and acting on different expectations will take on greater value. In response, leaders and managers must invest in their employees’ – from career development through to identifying what matters most to teams at different stages of the employee lifecycle, writes Steve Bennetts, EX Solutions & Strategy, Qualtrics.

Look around your office. Now imagine that at some point over the next 12 months almost a quarter of your colleagues are likely to quit the organisation. Another year down the line that number will increase to 40 per cent.

To figure out what motivates your employees and reduce employee attritition you’ll need to start listening to them. The Qualtrics research revealed more than two-thirds of workers believe it is very important employers listen to their feedback.

It might seem shocking but I say it to highlight a point – Australian businesses experience the highest rate of employee attrition globally, according to The Qualtrics 2020 Employee Experience Trends report.

Workers under the age of 30 are the biggest flight risk, with close to a third (28 per cent) looking to change jobs within a year and more than half (51 per cent) planning to exit within two years. By contrast, just 36 per cent of over-30s plan to change employers by the two-year mark.

The true cost of employee attrition
Staff turnover is extremely costly, with some reports estimating it costs Australian businesses almost $4 billion in lost productivity. There’s also significant recruitment costs, and then once you’ve found a candidate you need to onboard them.

Beyond the numbers, employee attrition has other less obvious impacts – the effect on the morale of remaining staff who may lose a valued co-worker and have to pick up the slack once they’re gone, the impact on your reputation with customers, and the loss of company knowledge that goes with your exiting staff member.

Listen to the voice of your workforce
It’s not all bad news though. When it comes to employee engagement, A&NZ fares better on the global stage returning a score of 53 per cent – only the USA (55%), France (55%), and Canada (54%) scored more (of countries returning 500+ responses).

This begs the question – what do employers and HR leaders do with findings like these?

Start by finding out where your business stands. Our research found that among the top reasons employees choose to leave are: a lack of opportunities for learning and development, feeling like they are not being recognised, challenges with work life balance, and opportunities to quickly increase remuneration by switching employers.

Avoid the mystery of the missing worker and the cost of finding their replacement by putting time into listening to your people today.

But don’t take our word for it. To figure out what motivates your employees and reduce employee attritition you’ll need to start listening to them. The Qualtrics research revealed more than two-thirds of workers believe it is very important employers listen to their feedback.

That’s especially true during times of transition and transformation, like many businesses in Australia are experiencing currently. While some may assume this isn’t the time to gather feedback, as things can get a bit messy, people want to be heard when change is happening. Don’t shy away from it because findings show you’ll be rewarded for it.

Businesses providing a feedback program achieved an engagement score of 57 per cent, while those who did not scored 45 per cent. Research shows highly engaged employees are more likely to exceed performance expectations too, and their employers benefit from two and a half times more revenue growth and 40 per cent less churn.

Action is everything in EX
But what really moves the needle is action. Engagement scores rapidly increase to 78 per cent when that feedback is acted on in a meaningful way and reduce (39 per cent) when businesses fail to act on it.

Here are 6 tips to get to know what your workforce really wants:

  1. Build a tailored program: Don’t measure for measurement’s sake. To get a grip on employee attrition, develop a tailored feedback program that’s relevant to your industry, your business, and your people. Personalise questions based on your employees and their roles.
  2. Check in regularly. In the Qualtrics Employee Experience 2020 study, businesses that collect feedback at least quarterly achieved engagement levels of over sixty per cent. This score dropped to around half (53 per cent) when businesses only collected feedback once or twice annually.
  3. Don’t shy away from bad news: If one issue stands out, it might be worth taking a closer look. Do a short survey focused around that topic area and repeat it over time to see how things change.
  4. Always evolve: No one wants to take the same survey again and again. And what’s important changes too. Keep your listening program up to date so you’re understanding what’s relevant.
  5. Now act: If there’s one thing worse than not listening at all – it’s listening then doing nothing. Our research consistently finds that what really moves the needle on attrition rates and engagement is whether an employee feels the company turns their feedback into action.
  6. And remember – you’re not on your own: Listening platforms can assist with turning insights into actions, providing recommendations on how to deal with particular issues that might emerge in the course of your investigations.

Imagine that at some point over the next 12 months almost a quarter of your colleagues are likely to quit the organisation. Another year down the line that number will increase to 40 per cent.

As the workforce in Australia becomes increasingly diverse, the importance of understanding and acting on different expectations will take on greater value. In response, leaders and managers must invest in their employees’ – from career development through to identifying what matters most to teams at different stages of the employee lifecycle. This will enable companies to reduce employee attrition and increase engagement – retaining exceptional talent and creating a more positive situation for all.

Avoid the mystery of the missing worker and the cost of finding their replacement by putting time into listening to your people today.

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