Employers are warned about a potential spike in staff turnover as the end of the financial year means staff bonuses and salary changes start hitting employee bank accounts.
“Industries and sectors that have shown recovery will be the first to experience this turnover,” said Matt Dale, Head of Consulting at Futurestep “The Finance sector for example is already starting to compete for staff. It’s expected that some segments of the market-place will see turnover double.
“Many employees have foregone pay increases, bonuses or other perks during the downturn and may even have accepted reduced hours or salaries. As the market turns, employers may find they have used up their goodwill with employees, who are being actively courted in a rebounding market.
“Our experience shows that certain industries see more movement depending on the time of year. The banking and finance sector for example can expect to see a greater turnover following bonus payments,” added Mr Dale.
Ramifications of staff turnover can be critical to businesses. “There is the obvious cost of recruitment and lost productivity. It’s commonly asserted that the cost of someone leaving at an inopportune time is somewhere in the vicinity of the person’s annual salary or one and half times their salary. For some businesses there is also the prospect of missed opportunity to grow in an expanding market.”
There are some tell-tale signs that can pre-empt staff turnover says Mr Dale. “Changes in behaviour are significant; employees considering leaving are likely to stop applying discretionary effort or volunteering for projects. They may start taking short periods of leave or arrive late or go home early. A normally social employee may no longer attend work functions.”
Data from exit interviews can give an indicator of the mood across the business. Performance reviews may also reveal changing sentiment but, if managed well, should be an early indicator and allow time for any issues to be addressed and employers to reengage with their people.