Tag: attrition

A recession should not have any impact on staff turnover or retention

Predictions of a spiralling economic crisis will be another blow to businesses’ hiring headway but according to Steven Jagger, founder of tech recruitment firm Maxwell Bond business leaders should “revamp” their culture in order to weather the looming recession and avoid a Great Resignation 2.0.

The arrival of the so-called Great Resignation this year hit the headlines and saw UK businesses’ staff turnover and attrition rates hitting record levels. But experts are forecasting another blow once the impacts of inflation, the cost-of-living crisis, and the recession come into full force.

Steven Jagger, Founder, Maxwell Bond commented: “An economic crisis shouldn’t leave you clutching at straws and panicking. Staff will always be loyal – if you give them reason to be. Employees don’t leave workplaces and colleagues – they leave bad leadership, toxic culture, or a lack of vision for your team and business. Ask yourself, when was the last time you looked at these and revamped your vision?”

Jagger was quoted saying that while a recession would be another blow to businesses when they’re already down, it shouldn’t have any impact on staff turnover or retention if your business’s culture is right.

The founder of the award-winning tech and digital recruiter whose clients include the BBC, Reckitt Benckiser, Barclays, TalkTalk, and Mastercard, believes talent retention “is a skill in itself” and that many leaders “fail to see the importance of it in times of adversity”.

Jagger continued: “By industry standards, we should have experienced higher attrition rates than we have to get to these numbers, but we founded the company on the values of prioritising people, especially our staff, above anything else.

“A recent Deloitte report shows only 56 per cent of employees think their company’s leadership cares about their wellbeing – contrasted to 91 per cent of leadership believing their employees think they care. This disconnect is a big player in staff turnover.

“Companies need to go the extra mile to attract and retain candidates if they want to hit their hiring aspirations, stay ahead of their competitors, and weather the incoming storm. In times of adversity, it’s understandable that survival instincts are to slash headcount and starve spending – but this short-term logic leaves firms bare once the turmoil is over.

With that being said, he understands employers can be afraid of the “T word” (turnover), wrongly perceiving that it reflects their leadership and values: “Some level of turnover, whether facing economic hardship or not, is part of any healthy organisation. If you train people up, they may leave to progress further and take on a higher role or they may be poached by another company for their skills and talents.

“Either of these scenarios means that as their employer, you did your job properly. Remember: running water never goes stale.”

But Jagger says to take heed: “Retaining someone who doesn’t fit the company values can easily make the whole infrastructure fail,” he says. “Put a bad apple amongst good apples, the good ones will eventually turn bad and leave.”

Maxwell Bond has grown by 4,000 per cent since its inception five years ago, despite weathering numerous economic crises, and has seen a further 45 per cent increase just in the last six months. The firm took no financial support from the government during the pandemic.

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Good management key to staff retention following the Great Resignation

New research from people analytics company, Visier, has revealed that 43% of UK employees admit to having quit their jobs due to bad management. A further 53% are currently seeking new roles due to their current manager.

In the study of 2,100 workers, 85% agree that good management is key to their happiness at work. Four in ten said they stayed in jobs longer than they planned because they had good relationships with their managers.

The majority of employees surveyed believe that flexible working is beneficial for both workers (74%) and businesses (69%). But while staff enjoy flexible hours and remote work,  it is clear that lack of face-time has been damaging for employee-manager relationships. The main contributors to this are:

  • Lack of face-to-face meetings (51%)
  • Increased working from home (44%)
  • An over-reliance on emails (44%)

Only 48% of workers are comfortable discussing their personal lives with their managers, indicating that leaders are struggling to build strong relationships with their teams.

Daniel Mason, VP EMEA of Visier, commented: “The old cliché – people don’t leave jobs, they leave managers – rings true, and the pandemic has made it harder for leaders to develop personal relationships with employees.”

“This isn’t a case of leaders becoming bad managers overnight, but instead, they are making difficult decisions with less information available to them.”

“The move to remote and hybrid working has starved managers of the opportunity to observe and meet with team members. Face-to-face interactions and other natural moments to develop a rapport are fewer, so managers should look to enhance their toolkit with data and insights to better understand and anticipate employee needs.”

When asked to identify the most valuable traits of a good manager, the most popular responses were as follows:

  • Treating people well (47%)
  • Listening to workers (47%)
  • Showing respect to all members of staff (47%)

On the other hand, the attributes of a bad manager were:

  • Failure to listen (49%)
  • Being unapproachable (47%)
  • Treating other members of staff differently (43%)
  • Shouting at the team (42%)

The most important factors for happiness in the workplace were:

  • Enjoying their work (45%)
  • Good pay (39%)
  • Good colleagues (35%)

Further data revealed that:

Sixty-two percent of the respondents felt that they currently had a good manager, and 45% believed that they could do the job better themselves. This group was questioned as to how they would improve, and their responses were:

  • 53% said they understood the concerns of other employees
  • 46% would treat all members of staff with equal respect
  • 36% would make an effort to get to know the people they manage better

Mason continues: “Businesses have spent the past few decades using data and other innovations to improve customer relationships and increase revenues. Many organisations are yet to harness these methods to better understand their most important asset – employees.”

“Every organisation already has a wealth of people data scattered throughout. Modern tools and analytics can find and organise this data to generate people insights to help you better understand and manage talent. When these insights are combined with other types of data from across the organisation, the result can drive more impactful business outcomes and unlock the next wave of growth and success.”

With employers struggling to fill vacancies and retain key talent following the Great Resignation, it’s clear that good management is essential to staff retention.

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Scottish civil engineering firm guarantees 130 jobs 

In the last year, there has been an increase in businesses adopting employee ownership schemes with one of Scotland’s most successful civil engineering contracting companies choosing now to do so, thereby guaranteeing the future of 130 jobs.  

Tayside-based, Kilmac Limited, is being placed in an Employee Ownership Trust (EOT) by its founders Athole McDonald and Richard Kilcullen, 18 years after its inception.  

According to reports, Kilmac has an annual turnover of £20m, with current projects including the transformation of Perth City Hall and the latest development phase of the James Hutton Institute in Dundee. Kilmac acts as the main contractor for local authorities, universities, local health services, road network authorities, council direct labour organisations and private clients, and is the leading groundworks contractor for commercial, social infrastructure and housing projects. 

The process of moving the business into employee ownership has been supported by Kilmac’s accountants Azets, legal advisors Thorntons Solicitors, and employee ownership specialists Ownership Associates 

Owners Athole and Richard, both civil engineers who started the business in 2004 after meeting earlier at Dundee Institute of Technology, plan to remain in place for at least the next three years.  

Athole, founder of Kilmac commented: “We have to look to the future and by creating an EOT, Kilmac will be in the safe hands of our excellent senior management team. It’s good news for Tayside, with the vast majority of our staff living in Dundee, Perthshire and Fife, and it ensures the company will continue to provide stability for our customers and job security for our employees. We have come a long way from the days when our biggest headache was getting the photocopier to work and stop the kitchen worktop being covered in ink. We knew what we wanted to deliver and have remained true to our principles.  

“We could have found a buyer for the business but we have an experienced and talented team who are more than capable of taking on the reins over the next few years. The structure is being created to take the business forward, provide clarity to our staff and customers and to avoid unnecessary disruption.” 

Carole Leslie of Ownership Associates provided employee ownership support for the project and assisted on communication with the new employee owners and other stakeholders. 

Carole said: “The employee ownership business model is an excellent succession option for business owners who want to persevere their legacy while protecting the future of their employees who have helped shape the company. 

“Under the ownership of Athole McDonald and Richard Kilcullen, Kilmac is well-established as one of the most successful and forward-looking civil engineering businesses in Scotland, and by opting for an EOT they have ensured that an enterprise they started over a kitchen table will continue to thrive, and to provide rewarding employment for more than 100 staff.” 

Kilmac joins a number of successful businesses in the area who have opted for an employee ownership trust structure and the move has been warmly welcomed by staff. 

Finance Manager Julie Scobie said: “Kilmac has always felt like a big family and it’s comforting for everyone to know that Athole and Richard have full confidence in their staff to be able to hand the legacy of their company into employee ownership as they navigate their next steps.”  

SF Recruitment, a leading specialist recruiter in the Midlands recently implemented an employee ownership scheme in order to become completely employee-centric.  

Saira Demmer, CEO at SF Group commented: “Last year we made a wholesale switch in our model to become an employee-centric business. This meant a lot of changes to the way we were operating, but we felt that to really make the change stick, we wanted to put our money where our mouth is and share the profits of the business with our employees too. It’s an open and transparent scheme with every single individual in the business having a share, regardless of their job title, seniority or tenure. Since introducing it, we have seen a significant increase in engagement and autonomous behaviour which in turn has improved performance and reduced churn quite significantly.”  

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The Great Escape and The Great Resignation result in mass exodus of workers
According to a new report by Kincannon & Reed, the disruption and upheaval caused by the pandemic during the last two years has resulted in a dramatic ripple effect across many industries, including those that ensure a safe, secure and abundant food system. Supply chain disruptions, labor shortages, implementation of safety equipment and protocols, along with the fact that stay-at-home orders upended standard operating procedures and forced on-the-spot decision making for all levels of the workforce. This, coupled with endless Zoom calls and dealing with on-edge customers and consumers, and simply supporting teams manage the ‘new normal’ made for an environment that business leaders have never seen before. It’s enough to make a person throw in the towel. And many have.

The pandemic has forced members of the workforce to take stock and re-prioritize their lives and careers – leading to a mass exodus of staff that the HR industry has dubbed “The Great Resignation”.

Scott A. Scanlon, CEO of Hunt Scanlon Media, has called it the ‘Great Escape.’ Older workers have also taken advantage of early retirement as part of the normal employment work cycle. According to the New School’s Schwartz Center for Economic Policy Analysis, roughly two million more people than expected have joined the ranks of the retired during the pandemic.

With skills shortages and The Great Resignation hammering the market, questions we should be asking are: How should company leaders manage an unexpected exodus? How can they attract new talent while also retaining the great leaders?

Kincannon & Reed’s Carolyn Schubert, Managing Director, and Jim Gerardot, managing partner, say leaders should consider five key points as they navigate this constantly evolving environment:

1. Prepare Talent for Leadership

“Many senior leaders retire for various reasons,” said Ms. Schubert. “It’s a double whammy for an industry that has also been a victim of the Great Resignation. The problem is the industry hasn’t done a very good job of succession planning and preparing others within their ranks to take on leadership roles. Companies need to put a solid succession plan in place to train, keep and promote talent.”

2. Treat Recruits Like CEOs

Ms. Schubert says the fact that there simply aren’t a lot of people changing jobs has created a talent war. “To attract and retain the best of the best, you must be forthcoming with candidates and let them know what’s possible beyond the job you’re recruiting for,” she said. “Act like you’re recruiting for a CEO job because the candidate you’re interviewing could be your next one.”

“During the recruiting process, share your financials, strategic vision and long-term goals; give candidates an opportunity to interact with board members,” said Ms. Schubert. “Make them feel important and let them know they’ll be a part of the organization in a larger way.”

3. Show Them the Money

Mr. Geradot says that today’s candidates are looking at total compensation – short and long term. “They are seeking and comparing specifics on benefit packages, relocation incentives, signing bonuses, as well as long-term incentives – all considerations when looking to attract top candidates in today’s market,” he said.

4. Be Transparent

“Be fully transparent about company culture, structure, and benefits, and the future,” said Mr. Geradot. “The current war for talent means the brightest prospects are inundated with opportunities, so they’re being selective and doing their homework to better understand a company before they step foot in the door (or log onto Zoom) for an interview.”

5. Prepare to Sell Yourself

There was a time when companies, particularly legacy companies, had the attitude: “The top candidates will want to work for us,” said Mr. Geradot. But that’s not the case anymore.

“Instead of potential employees having to sell companies on the value they can bring, the tables have turned,” he said. “Companies are in the hot seat – having to prove themselves – and start-ups seem to have a leg up on speaking to culture, values, purpose, and perks.”

 

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