A Perfect Storm
The Gallup-Healthways organization publishes its monthly Well-Being Index http://www.well-beingindex.com/ on the second Thursday of each month. The data in the Index are derived from Gallup-Healthways’ daily live telephone sampling of at least 1,000 U.S. adults aged 18 and over and measures Life Evaluation, Emotional Health, Physical Health, Healthy Behavior, Work Environment and Basic Access. These daily surveys have been conducted since January 2008.
The Work Environment component of the Index asks respondents questions about their overall Job satisfaction, their ability to use their strengths at work, how they are treated by their supervisor (more like a boss or more like a partner) and if their supervisor creates an open and trusting work environment. According to Gallup-Healthways, prior large-scale meta-analyses have shown that satisfaction with one’s work environment is directly correlated with worker engagement, attendance, productivity, profitability, safety and customer ratings.
Companies have been reducing headcount and dividing the workload among remaining staff since fall of 2008. Many have also frozen pay and cut back on benefits. The result is that employees are working longer and harder for less. It should not be a surprise that employee work environment satisfaction has consistently fallen. Employees are not happy. In fact, after rising briefly from its absolute low point in February of this year, worker satisfaction has since been steadily declining with 2011 employee workplace satisfaction now at its lowest since the Index began in 2008.
The Index’s Emotional Health component examines factors such as an individual’s perceptions of being treated with respect along with their levels of enjoyment, happiness, worry, sadness, anger, stress and depression. After rising from the absolute lows of December 2008 in the depths of the financial crisis, by August of this year the Emotional Health Index had fallen back to a low last seen in March of 2009.
Learning that workers are emotionally taxed and dissatisfied with the workplace is never good news, but it is uniquely bad news when taken in context with the wholesale “right sizing” of recent years that has left companies scaled down to their best and most productive workers. These are not only the people a company cannot afford to lose, but also the ones that other companies want. It is therefore a major mistake for leaders to assume that talented workers will not leave for other jobs during periods of high unemployment or that no one is hiring or actively seeking new talent. Employees will leave and companies are hiring.
The loss of top talent can be devastating. They are hard to replace and their loss exacts a high toll on a workplace where average workloads have already substantially increased. Not surprisingly, turnover among top talent creates turnover among top talent. Exiting employees take with them—often to a competitor—not just their skills, but also their knowledge, experience and relationships with customers; compounding the damage.
The data are clear that companies are experiencing historically unprecedented levels of worker dissatisfaction, disengagement and emotional stress—the perfect storm to create voluntary turnover. Indicators that the company is heading toward a turnover crisis are such things as decreases in individual productivity, increased absenteeism, increased workplace conflict and deteriorating customer relationships. The top talent are not, as some leaders believe, “greatful to have jobs.” They are cashing their paychecks while watching for the right new opportunity to present itself. The bright spot is that many companies recognize the problem and are taking steps to address it.
Leathers Milligan – OI Partners surveyed 220 employers during the 2011 SHRM conference in Las Vegas. A full 87% disclosed that they were somehat to very concerned about losing talent, with 55% of that group fearful that the loss would be greatest among their high potentials. They recognize that their organizations are vulnerable and many are responding by stepping up retention strategies while also reaching deeper into their oganizations to enhance their bench strength of future leaders. Seventy-two percent plan to increase executive and high potential leadership development and coaching as key elements of their overall retention strategies. While both leadeship development and executive coaching programs are certain to enhance job skills, it may be the positive psychological impact, the individual’s recognition that the company cares about them and is willing to invest in their future, that has the greatest short term value by enhancing worker satisfaction and improving emotional well being. Data continue to prove that investments in employee development improve employee satisfaction that in turn drives up employee engagement and leads to higher levels of productivity and profitability. In fact, Harvard Business Review studies reveal that companes investing in leadership development will out perform their peers by up to 35%. What are you doing to retain your critical talent?