Employers fearful of talent exit

Employers are worried that as the job market improves more of their workers are ready to walk out the door, a Hartford career-coaching firm’s survey shows.

Almost two-thirds (64 percent) of companies are apprehensive they may lose managers in a better job market, according to a survey by OI Partners-SIMA Career Coaching (Hartford), a global talent management firm. About half of employers (48 percent) are concerned about losing executives.

Fighting to retain managers and executives, four out of 10 companies are offering better salaries and benefits, and more than half of organizations are utilizing training, coaching, and other developmental programs, the survey found.

“There is a lot of pent-up frustration among employees who have survived layoffs, cutbacks, salary freezes, and other givebacks,” said Ed Poff, Hartford managing partner of OI Partners-SIMA Career Coaching.  “Some have stayed with their employers mainly because there were no other available jobs.  But now there are a few more opportunities. Companies have to demonstrate to employees that they are valued by investing in their career development, or they may lose them.”

More employees voluntarily quit their jobs than were discharged in February, March, and April this year, according to the most recent U.S. government statistics. 

In February – for the first time in 15 months, since October 2008 – the number of employees voluntarily leaving jobs exceeded those being laid off.  Again in March and April, more workers voluntarily quit jobs than were discharged, according to the U.S. Bureau of Labor Statistics.

Replacing a manager or executive who leaves for another job, or one who turns out to be a bad hire or promotion, can be costly.

It costs an average of 2.5 times an executive’s salary, and twice a manager’s compensation, to replace them, according to the survey of 262 companies by OI Partners-SIMA Career Coaching. The costs are for recruitment and training of the worker who leaves and the replacement, lost business, and severance pay and benefits.

Employers are at a greater risk for losing good workers with the economy adding jobs at even a modest pace.