Money gets them in the door, work-life balance holds them
The global competition for talent means Canadian organizations must ensure their employment offerings are competitive against a larger market, while balancing fiscal realities.
2007 Global Strategic Rewards Report, a study by HR consulting firm Watson Wyatt, shows there are more similarities than differences when it comes to attraction and retention. Employees are largely looking for the same things in their employment deal and organizations that meet these demands, locally or globally, are better positioned to compete.
The study focused on rewards practices in Canada, the United States, Asia-Pacific, Europe and Latin America. It included 946 companies and was analysed in conjunction with a global survey of more than 13,000 employees.
The research shows the following similarities and challenges among global organizations:
Attraction and retention are global challenges. Organizations are facing increasing challenges in attraction and retention — specifically of critical-skilled employees and top-performing employees. In Canada, the percentage of employers reporting difficulties in this area has increased by more than 20 per cent since 2004. Asia Pacific and Latin America are reporting the most difficulty given their rapidly increasing economies.
Compensation matters. Employers do not fully understand the reasons why employees join an organization. While employers tend to believe elements of the corporate environment will attract an employee — such as corporate culture and employer reputation — employees are more focused on monetary gain.
This was especially true among Canadians. Employees rank items such as base pay, job security and health benefits as key deciding factors, while employers rank base pay fourth in importance. Employers in the other major markets rank it second.
Stress is a retention issue. A global disconnect exists between why employers believe employees leave an organization and why employees actually leave. Employers think employees leave for base pay but, among nearly all global areas surveyed and employee groups (top performing employees, highly engaged employees, employees overall), the number-one reason is stress.
While base pay did rank in the top two among employees in the U.S., Asia Pacific, Latin America and Europe, in Canada it ranked in the top five. Canadian employees place more emphasis on non-monetary items over base pay when it comes to reasons for leaving.
Focus on work-life balance. Employees satisfied with stress levels and work-life balance are 20-per-cent more likely to stay and 30-per-cent more likely to recommend their employer as a place to work.
Canadian employees are the least satisfied with current work-life balance among the five regions surveyed, with only 41 per cent reporting their company makes it possible for them to have a healthy balance. Employees in Asia Pacific were most satisfied at 59 per cent, followed by Latin American employees at 57 per cent, European employees at 51 per cent and American employees at 45 per cent.
Canadian talent is attractive. There are additional monetary gains from ensuring employee satisfaction with stress and work-life balance. From an overall standpoint, the study found it would take a 25-per-cent higher salary increase for an employee satisfied with his current work-life balance to leave his current employer than a worker who is not satisfied.
Among employees in general, however, Canadian employees only need an 18-per-cent increase to consider an opportunity at another organization, compared to 21 per cent in America, 24 per cent in Europe, 31 per cent in Asia Pacific and 42 per cent in Latin America. This may make Canadian talent attractive targets for employers in other countries.
To attract and retain the needed talent to fuel Canada’s economic engine, organizations must remain aware of global competitors and understand global and local conditions and expectations.
Organizations best positioned to acquire, retain and motivate employees are those that:
• articulate ‘what’s in it for me’ when recruiting;
• understand employee preferences in total rewards and then design, develop and communicate rewards to meet these preferences and, therefore, realize a greater return on rewards investments; and
• address stress and work-life balance issues in the workplace through sufficient staffing levels, clearly articulated roles and responsibilities, aligned recruitment methods and effective training.
Liz Wright is the compensation practice leader for Watson Wyatt in Toronto. She can be reached at [email protected]. Anne Peiris is a compensation practice consultant for Watson Wyatt in Toronto. She can be reached at [email protected].
2007 Global Strategic Rewards Report, a study by HR consulting firm Watson Wyatt, shows there are more similarities than differences when it comes to attraction and retention. Employees are largely looking for the same things in their employment deal and organizations that meet these demands, locally or globally, are better positioned to compete.
The study focused on rewards practices in Canada, the United States, Asia-Pacific, Europe and Latin America. It included 946 companies and was analysed in conjunction with a global survey of more than 13,000 employees.
The research shows the following similarities and challenges among global organizations:
Attraction and retention are global challenges. Organizations are facing increasing challenges in attraction and retention — specifically of critical-skilled employees and top-performing employees. In Canada, the percentage of employers reporting difficulties in this area has increased by more than 20 per cent since 2004. Asia Pacific and Latin America are reporting the most difficulty given their rapidly increasing economies.
Compensation matters. Employers do not fully understand the reasons why employees join an organization. While employers tend to believe elements of the corporate environment will attract an employee — such as corporate culture and employer reputation — employees are more focused on monetary gain.
This was especially true among Canadians. Employees rank items such as base pay, job security and health benefits as key deciding factors, while employers rank base pay fourth in importance. Employers in the other major markets rank it second.
Stress is a retention issue. A global disconnect exists between why employers believe employees leave an organization and why employees actually leave. Employers think employees leave for base pay but, among nearly all global areas surveyed and employee groups (top performing employees, highly engaged employees, employees overall), the number-one reason is stress.
While base pay did rank in the top two among employees in the U.S., Asia Pacific, Latin America and Europe, in Canada it ranked in the top five. Canadian employees place more emphasis on non-monetary items over base pay when it comes to reasons for leaving.
Focus on work-life balance. Employees satisfied with stress levels and work-life balance are 20-per-cent more likely to stay and 30-per-cent more likely to recommend their employer as a place to work.
Canadian employees are the least satisfied with current work-life balance among the five regions surveyed, with only 41 per cent reporting their company makes it possible for them to have a healthy balance. Employees in Asia Pacific were most satisfied at 59 per cent, followed by Latin American employees at 57 per cent, European employees at 51 per cent and American employees at 45 per cent.
Canadian talent is attractive. There are additional monetary gains from ensuring employee satisfaction with stress and work-life balance. From an overall standpoint, the study found it would take a 25-per-cent higher salary increase for an employee satisfied with his current work-life balance to leave his current employer than a worker who is not satisfied.
Among employees in general, however, Canadian employees only need an 18-per-cent increase to consider an opportunity at another organization, compared to 21 per cent in America, 24 per cent in Europe, 31 per cent in Asia Pacific and 42 per cent in Latin America. This may make Canadian talent attractive targets for employers in other countries.
To attract and retain the needed talent to fuel Canada’s economic engine, organizations must remain aware of global competitors and understand global and local conditions and expectations.
Organizations best positioned to acquire, retain and motivate employees are those that:
• articulate ‘what’s in it for me’ when recruiting;
• understand employee preferences in total rewards and then design, develop and communicate rewards to meet these preferences and, therefore, realize a greater return on rewards investments; and
• address stress and work-life balance issues in the workplace through sufficient staffing levels, clearly articulated roles and responsibilities, aligned recruitment methods and effective training.
Liz Wright is the compensation practice leader for Watson Wyatt in Toronto. She can be reached at [email protected]. Anne Peiris is a compensation practice consultant for Watson Wyatt in Toronto. She can be reached at [email protected].
