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Employee flight a real risk in 2014, according to Hudson
Almost two-thirds of employees are looking for a new role
Sydney, Australia – 29 January 2014 – This quarter’s Australian organisations are facing a serious business risk with nearly two-thirds (63.7%) of employees actively or passively looking for a new job, and 66.7% of them looking to move within the next six months, according to Hudson’s Australian & New Zealand Salary & Employment Insights 20141 Guide.
Higher remuneration is the main reason people are assessing their options, followed by a more interesting role and an organisation that will make them happy, while six in ten employees believe a higher income would provide motivation to work harder.
The quest for higher salaries comes despite the fact that most employers reported that they awarded modest pay increases in 2013 with 73.9% increasing salaries in line with CPI (2-3%) primarily to retain high-performing staff.
Higher salary demands come as organisations attempt to transform to succeed in ongoing challenging and changing market conditions. Seven out of ten of Australian employers surveyed said that they carried out a large-scale internal change program in the last 12 months. The main reasons for doing so were to become more efficient (73.3%), to reduce costs (71.6%) and to develop new capabilities (36.9%).
Demands for higher salaries present real challenges for employers with most (77.2%) believing they are facing tougher market conditions than a year ago, pressure on budgets is greater (76.3%), and more than half have stricter headcount approval processes. That said, nearly three quarters of employers (74.1%) expect to award a pay increase of 2-3% this year and two-thirds of employers believe their organisations will meet or exceed their targets within the next six months.
Demands on employees are also greater with 45.9% working longer hours than 12 months ago, while only 47.1% feel the same level of security in their jobs. Interestingly, while just over half of employers reveal that stress levels are up, 30.3% said morale is more positive compared to a year ago.
“Many employees are working longer and harder, feeling less secure in their current role and are looking for new opportunities. Businesses could be facing a potential triple cost scenario: the costs of a disengaged workforce, the costs of staff turnover and the costs of losing key talent,” said Mark Steyn, CEO Asia Pacific, Hudson.
“Our findings clearly demonstrate that the workforce is willing to move, and move quickly. The impact to the business and cost of replacing, training and up-skilling new workers is likely to be much higher than retaining and developing staff that are already performing well; particularly when high performing individuals leave the business.
“Employers need to remember that the majority of people are seeking an opportunity to advance their careers, skill sets and experiences. Along with financial rewards, we recommend that organisations consider revisiting engagement strategies for all staff and enable employees to develop their own career path via options such as stretch assignments, secondments to other business functions, taking on new projects, training and development.
“We know that strong leadership impacts engagement, driving productivity and increased employee retention. This is something that cannot be ignored, particularly in a climate where there is increasingly high potential for movement within the workforce. Revisiting leadership and development strategies for managers and leaders to ensure they are able to lead effectively in the rapidly changing marketplace is key,” he said.
With the need to adapt to rapidly changing markets greater than ever, contractors provide an immediate fluidity in skill sets and this is driving increased use with 27.8% of employers surveyed using more contractors than a year ago. They are primarily doing so to fill a short term need (51.7%) or to give them flexibility of staffing (51.4%).
“Although nearly three-quarters of organisations in Australia have gone through large-scale organisational change programs in the past year, it’s important to note the depth and breadth of talent organisations require is constantly changing. Organisations require flexibility in their skills sets and talent mix in order to stay competitive and innovate to keep pace with an ever changing market. Employers are increasingly turning to contractors to meet this need, while more and more people are willing to consider contract work for the flexibility, exposure to new things and variety of work it can offer,” Steyn added.
Annually, Hudson produces tailored Salary and Employment Insights guides for Accounting & Finance, ICT, Sales Marketing & Communications, Human Resources and Office Support. These guides provide in-depth market insights and salary analysis across roles and geographies providing a useful benchmark and negotiating tool for both employers and employees.
1 Hudson surveyed 3564 employers and 4677 employees in Australia.
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The Hudson Report: Employment Trends 2013 has changed its reporting approach to achieve greater transparency and consistency across markets. This makes it simpler to compare results and geographical variations. From now on, Hudson will report on three findings: the percentage of employers intending to increase staffing levels, those intending to maintain them and those intending to decrease headcount. ‘Hiring expectations' refers to the proportion of employers intending to hire more employees during the forthcoming quarter. Hudson will no longer use the 'net effect' figure.
Hudson is a global talent solutions company with expertise in leadership and specialised recruitment, contracting solutions, recruitment process outsourcing, talent management, outplacement and eDiscovery. We help our clients and candidates succeed by leveraging our expertise, deep industry and market knowledge, and proprietary assessment tools and techniques. With more than 2,000 people in 20 countries, and relationships with millions of specialised professionals, we bring an unparalleled ability to match talent with opportunities by assessing, recruiting, developing and engaging the best and brightest people for our clients. We combine broad geographic presence, world-class talent solutions and a tailored, consultative approach to help businesses and professionals achieve higher performance and outstanding results. More information is available at Hudson.com.
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