Attrition. It’s a term that means many things in a variety of different contexts.In the case of a business and its Human Resources (HR) department, attrition is the natural process by which employees leave the firm. Whether through resignation, for personal reasons or retirement, a key component of attrition is that there is a natural turnover rate.What’s the problem with this?
Well, in the current market, attrition is at an all-time low.
Although the pandemic era was described as “the great resignation”, there has been a major shift away from this trend – it’s like “the great stay where you are.”
In an article titled “The New Headache For Bosses: Employees Aren’t Quitting”, The Wall Street Journal puts it bluntly: “These days, too few people are voluntarily leaving their jobs”. In fact, the same article revealed that quits as a share of total non-farm employment have fallen by 25% since early 2022.
To add more salt to the wound for businesses, it also means that with fewer people leaving their jobs, the talent pool for future hires is smaller as well. If you’ve found yourself in this same situation, the solution is simple – you need to make the most of what you’ve got.
As for how to do that, this article will describe the most pressing problem with the current labour markets and lay out a clear and actionable solution to the current, albeit accidental, war on employee attrition.
The Current Labour Market.The Employer SituationI
n the face of a global recession and elevated interest rates, many companies are adopting a conservative approach to employee management.
As they look to weather the storm and minimise budgetary pressure, temporary hiring freezes have become increasingly prevalent among many companies.But that’s not the only concern.
With attrition rates at an all-time low and unemployment levels also near all-time lows, the result is a less dynamic talent pool from which companies that are still hiring can make decisions. This creates a key imbalance; businesses are cautious about new hires, and if they decide to hire, the available talent is less skilled.
The Employee Situation
It’s clear that employees are paying attention to the market.They understand that it’s harder to get a job today than it has been for some time and so, are looking to progress their careers internally instead. As Denis Machuel, chief executive of global staffing firm Adecco Group explained to the Wall Street Journal:
“People feel it’s probably a bit cold outside with the macroeconomics not being so good. And with this last-in, first-out typical scheme, they’re more likely to stay in their current role.”
In fact, a study from that same firm, Adecco, found that 73% of workers say they planned to stay at their jobs, up from 61% in 2022.Again, this creates an obvious imbalance; employees want to progress internally, but with fewer people leaving than ever before, internal opportunities are few and far between.
Stalemate!
So what does this mean?
These levels of low attrition can lead to a sense of stagnation, both:
- for employees seeking growth within a business and
- for businesses seeking to meet their long-term goals
The challenge, therefore, lies in addressing both:
- the desire of employees to progress their careers
- while also aligning them with the strategic objectives of the business.
In other words – you need to make the most of what you’ve got.The SolutionSo, how do you make the most of what you’ve got?Regardless of your current HR systems, it’s important to recognise that employees aren’t openly stating their future aspirations within a company.
By the same token, they also aren’t aware of all of the future progression opportunities that may be available to them.
The key to bridging this gap is internal workforce transparency.
HR Managers need a transparent way to:
- understand the skills and aspirations of current employees, and
- be able to match them with the long-term objectives of the business.
In other words, the key to a thriving business during the current lack of attrition is to make employees feel more confident about being transparent about what they want for their careers.
But how can you collect and act upon transparent employee data skills in your business?
With GoFIGR, it’s easy.
As an Internal Talent Marketplace platform, GoFIGR is a Software as a Service (SaaS) platform designed to collect and intuitively analyse employee skill data so you can supercharge your organisational development process.
With valuable insights collected from your team, GoFIGR allows you to:
- identify your employees’ current skills
- align them with your business expansion plans
- realise your team’s full potential
- reduce the cost of recruitment by upskilling from within
This way, you can go and FIGR (Find, Inspire, Grow and Retain) talent with data-driven strategiesYour future team is already working for you.
Don’t let that talent go to waste – allow them to grow their career AND drive your business into its tomorrow.
It’s the ultimate way to overcome the stagnating labour market is to foster a progressive internal culture and eliminate reliance on the never-ending hiring cycle.
Helena Turpin spent 20 years in talent and HR innovation where she solved people-related problems using data and technology. She left corporate life to create GoFIGR where she helps mid-sized organizations to develop and retain their people by connecting employee skills and aspirations to internal opportunities like projects, mentorship and learning.
