Remuneration remains one of the key drivers of retention. Mabili's snap survey on Actual vs Predicted Increases for 2009 indicated that exceptional increases were being awarded to key talent, although the ICT sector appeared to be lagging behind the other main industries.
The survey indicated that network administrators, technical specialists, and specialist ICT professionals were most likely to receive exceptional increases of between 10% and 12%, somewhat behind the 15% to 20% being provided in the financial and engineering industries. Are ICT companies falling into the trap of relying on the market conditions to retain staff or are they proactively tackling retention?
It has been suggested that the economic downturn is slowing the rate of unforced employee turnover; in a sense, a de-facto retention strategy. Sure, the job market has become more uncertain and employees are tending to stay put during the current economic climate, however, employers who sit back on their laurels and pay lip service to retention, are likely to find themselves in trouble as the economy picks up.
Employees who feel that they are exploited or taken advantage of because they have little opportunity to move during recessionary times are much more likely to move on when the tide eventually turns. And it will. On the other hand, employees who have felt engaged and motivated during the toughest part of the recession are likely to show a far greater degree of loyalty to their organisation.
With the talent pool expanding, one might think that to lose a few talented individuals may not be a huge problem. There are two key issues that need to be taken into account. Firstly, top talent remains scarce. While there may be more candidates in the candidate pool, they may not be at the level you are looking for. Replacing your high fliers will continue to be difficult despite a greater number of candidates to choose from.
Secondly, the cost of employing new talent increases during growth periods. We have noticed a far more conservative approach to remuneration in the past 18 months, with the past six months being particularly constrained. Our research suggests that in many cases, increase freezes have occurred and that in some instances, employees have had to take pay cuts in order to avoid retrenchments. It is during these periods that employers have most of the bargaining power. However, as the economic climate improves, the bargaining power swings from employers to employees.
Therefore, employers should not be lulled into a false sense of security. Retention remains a key issue and the manner in which organisations approach retention during a recession is likely to determine how they will be positioned to compete after the downturn.
In order to explore the drivers of retention more thoroughly, Mabili is busy completing its 2009 Retention Survey. The survey is being completed by a sample of leading South African organisations, including technology businesses, and looks set to deliver key insights and trends on the issue of retention.
For more information regarding the survey, please contact Diveshni on (011) 292 6940 or email Diveshni@mabili.co.za.
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