Retention Strategies versus Attrition in the New Economy
Here are the facts. Employment in most of the sectors is on the rise. New age industries and new markets are creating a gamut of employment options. With the advancement in telecom and infrastructure, companies are inviting eligible personnel to join their team and build business. So why is there a problem of attrition? Why do employees leave their companies? Where do they go? Who is hiring them? Are there any retention strategies that may help salvage the situation?
Look around you. Opportunities are knocking doors more than once a day. Despite this fact, we talk of unemployment problems, high attrition rates and failing retention strategies. Employers go all out wooing employees to stay on. HR is using all known tricks to keep the employees happy. Sounds like a familiar situation? If you have been driven at your wits' end trying to keep employees happy, then you need to reanalyze the situation. Let's go back to the facts stated earlier in this article.
- Employment on the whole is on the rise. True, yet not quite. Statistically, opportunities for employment are increasing faster than actual employment. But opportunities are not spread out in all sectors. We have seen the fastest growth in employment opportunities in telecom and infocom sectors. Industries in the business of computer applications, technology development, outsourcing, telecommunications, dotcom, and the like are witnessing a steep growth of employment options. Since there is so much of lop-sided growth, it is also seen that all sectors don't face similar employment problems. It is surprising to note however, that the industries which offer the highest growth opportunities also have very high attrition levels.
- New age industries and new markets are creating a gamut of employment options. Again, not quite true. New age industries are yet to stabilize in the evolving economy. Many emerging industries have created new markets and their recruitment needs are increasing. Dotcom businesses, as we witnessed, has seen a rapid growth of opportunities. A boom and a shakeout later, dotcoms have now settled for paced growth. Thus new age industries have impacted the economics of employment.
- Companies are inviting eligible personnel to join their team and build business. This is fairly true in many parts of the world. Now, the need for most HR professionals is skilled manpower with technological competence. Multi-skilled professionals who can work flexi time are sought after by employers. Employees who can match efficiency with effectiveness are the prize catch. These employees could be found at management and non management levels. Such professionals are a rare breed. Finding them within the corporate jungle is like searching for a needle in a haystack. But once found employers, would use every gimmick to keep them from jumping ship. In this employment market, the demand for skilled labor is higher than the availability.
- In businesses, where most employees are skilled professionals with technological competence, attrition rate is also quite high. That is because skilled labor needs much more than job security to keep them going.
Attrition levels could be high due to several reasons. Better facilities, greater career opportunities and personal comfort level are the commonly cited reasons. Retention strategies can work only when they are targeted to meet the core needs of employees. Very often employers try to satisfy superficial needs, which employees don't perceive the value addition.
A good study of the demographic profile of personnel can provide important leads to better retention strategies. Aspects such as age, sex, economic status of employees can help managers create a secure environment for employees.
Retention strategies should not just focus on paying the employees more in cash and kind. Creating a social platform, an intellectually stimulating environment and a development oriented organization will yield greater productivity and employee satisfaction in the long run.
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