Recruiting and retention are the top two Rs of staff management in business today
While recruiters and human resources managers hone their skills at recruiting talent, retaining key and valuable employees is equally important.
As the economy continues to grow, more and more employers are seeking qualified candidates, a scenario that encourages a percentage of workers to look afield for different opportunities.
Job Hunters Seek to Leave
In an August 2014 article in Fortune, Tara Sinclair, an economist in the research arm of Indeed.com is quoted as saying , “We expect to see that, as the economy improves, more job hunters will try and move into something that’s closer to their ‘dream job’.”
According to the Fortune article, Sinclair and her team used Indeed’s database to analyze the activity of 430,000 people. They found that 86 percent of job seekers who are already employed are looking for different positions, 60 percent are looking outside their fields and 28 percent are looking to move to a different state.
To stay competitive and increase current employees’ staying power, companies are looking at higher salaries, bonuses, flexible hours or a transfer to another company site. The states most attractive for employee movement are Texas, California and Florida. Workers are seeking to leave Washington, D.C., Wyoming and West Virginia.
Salaries are reflective of employers’ efforts to retain workers. The Employment Cost Index from the Bureau of Labor Statistics found compensation costs rose 0.7 percent in the first quarter of 2015 and over the year, compensation rose 2.6 percent and benefits climbed 2.7 percent.
A New Model
Until the end of the twentieth century, it was common for people to spend their working lifetime at one or two companies. Now, it’s an increasing trend for employees to job hop, especially in the millennial generation. According to the Bureau of Labor Statistics’ Employee Tenure Summary, an average worker had been with their company a median time of 4.6 years.
In an August 2012 Forbes article, Jeanne Meister said Millennials, the generation of workers born between 1977 and 1997, expect to stay in a job for less than three years; they might have 15 to 20 jobs over their working lifetime.
In the face of this movement, employers are starting to use employee algorithms, a form of cognitive computing, to predict who is thinking about leaving the company and why.
The algorithms make their predictions by analyzing employee data including promotions, past tenure, employment responsibilities, work relations and office atmosphere. While the algorithms analyze the likelihood of the employee leaving, none are absolute. The human element can’t be quantified or directly represented, but a combination of variables can be considered and weighed to determine how likely it is that the employee quits.
The Society for Human Resource Management’s publication Retaining Talent lists variables considered by a turnover predictor. At the top end, search behaviors, relationship with supervisor, and role clarity represent variables with high correlation to turnover rates while the bottom topics are race, sex, marriage status, pay, and lateness. These have a weaker influence on employee retention.
Workday, a developer of human resources software, also offers retention projections with the use of an algorithm app, Workday Talent Insights. The company says that the tool can identify and understand retention risk for the entire organization including the number of top performers at high risk of leaving in the next year and the projected cost to replace them. The app looks as such factors as time in current job function, number of job functions held or time between promotions.
Volometrix, a people-analytics company, provides human resources services for analyzing employee performance and attrition and says their predictions can predict employee disengagement twelve months in advance. In order to make accurate forecasts, Volometrix considers employee mentorships, work-life balance, and time-allocation along with employee emails and meetings. They have observed a strong correlation between employee engagement and retention.
The Australian-based survey and analytics firm, Culture Amp, also connects variables of workplace engagement such as leadership and managerial competency when determining possible talent loss.
In a Businessweek.com article, Ultimate Software, another algorithm developer, says they collect such factors as pay, job performance, benefits and career path. Using the company’s UltiPro Retention Predictor platform, Ultimate Software claims to create “a statistical model that represents if the employee will stay at their company for the next twelve months.” While no company has found one specific cause for employees leaving, Ultimate Software has noticed correlations between employees who have turned down benefits and those who quit.
On the flip side of employee retention, Bloomberg Business recently reported J.P. Morgan will roll out an algorithm that uses a surveillance unit to track employees’ behavior.
The algorithm, developed by Tennessee-based Digital Reasoning Systems, has technology similar to that built for counter-terrorism and collects such data as emails, chats and phone calls. Using this information J.P. Morgan hopes to identify those rogue employees who may pose a future risk for the giant bank, already reeling from losses since the financial crisis, including legal bills of $36 billion