Hay Group Research Finds Employees Growing Increasingly Restless with their Employers

PHILADELPHIA--(BUSINESS WIRE)--Employee restlessness is rising, according to new data from Hay Group. In 2011, nearly two in every five employees (38 percent) planned to leave their employers within the next five years, compared to 30 percent in 2009. Employees are also increasingly concerned about their organizations’ ability to retain top talent (only 43 percent held favorable views in 2011, compared to 56 percent in 2009). The data, pulled from Hay Group’s global employee opinion database, include the opinions of over 1,696,000 U.S. employees working in 152 organizations.

“U.S. companies have experienced lower turnover rates over the past few years, largely because of the weak labor market associated with the economic downturn. We’re in the eye of a turnover hurricane that has lulled many companies into complacency”

“U.S. companies have experienced lower turnover rates over the past few years, largely because of the weak labor market associated with the economic downturn. We’re in the eye of a turnover hurricane that has lulled many companies into complacency,” said Mark Royal, senior principal at Hay Group Insight. “In the meantime, employee frustration is rising. Organizations that fail to identify and act on issues affecting employee commitment during this break in the storm are going to find employees exiting in increasing numbers as other opportunities become more plentiful.”

The employee engagement picture remains mixed at many organizations. While commitment to the company has flagged, employees’ willingness to invest discretionary effort held fairly stable from 2009 to 2011, along with their feelings about their job security and career advancement opportunities. However, issues related to employee enablement – involving providing employees with the necessary support and resources to do their jobs successfully – took a downward turn:

Organizational effectiveness: 58 percent of employees said their employers organized work effectively, compared to 63 percent in 2009.
Inefficient operating: 57 percent of employees said their employers operated efficiently, compared to 64 percent in 2009.

“The key to retention is enablement,” said Royal. “Over time, engaged employees who are struggling to get things done may either stop trying – or vote with their feet and leave. Unfortunately for organizational leaders, high performing and high potential employees who can find alternative opportunities even in tough labor markets are particularly likely to be turnover risks in the face of workplace frustration.”

Additional Findings:

Employees’ Confidence in Organizations Drops. An increasing number of employees are worried that their organizations are keeping focus on long-term goals in addition to short-term results. Only 65 percent of employees felt confident that their employers had a long-term orientation in 2011, a significant drop from 76 percent in 2009. Employee confidence in their companies having a clear sense of direction also dropped 9 percentage points from 2009 levels.

Pay Concerns Increase. Although organizations are asking employees “to do more with less,” their ability to reward extra effort has been constrained during difficult economic times. Concerns about equity in pay relative to other companies grew by 8 percentage points from 2009 to 2011. What’s more, only 44 percent of employees said their company was doing a good job in matching pay to performance in 2011, compared to 48 percent in 2009.

Mark Royal is co-author of the book “The Enemy of Engagement” (AMACOM, 2011), which includes more in-depth information about structuring work environments to avoid workplace frustration and translate employee engagement into improved productivity.

For more information or to arrange an interview with Mark Royal, please contact Andrea Friedman at 212-584-5476 or andrea@blisspr.com.

About Hay Group Methodology

Data for this research were drawn from the global employee opinion database compiled by Hay Group. Updated annually, the database is comprised of responses from more than 5 million employees working in over 400 organizations worldwide, representing a broad cross-section of industries and sectors. To learn more about Hay Group’s Employee Effectiveness Surveys, click here.

About Hay Group

Hay Group is a global consulting firm that works with leaders to turn strategies into reality. We develop talent, organize people to be more effective, and motivate them to perform at their best. With 84 offices in 48 countries, we work with over 7,000 clients across the world. Our clients are from the public and private sector, across every major industry, and represent diverse business challenges. Our focus is on making change happen and helping organizations realize their potential.

For over 35 years Hay Group has partnered with the world’s largest and most complex organizations to create value through the strategic use of employee survey research. Our mission is to help senior leaders identify the barriers to individual and organizational effectiveness, and remove them to improve the performance of people, teams, and organizations.

By providing employee feedback and supporting strategy, our surveys help organizations achieve high levels of performance and lasting change.