Training Industry Magazine - Fall 2022 - 46

INVESTING IN CAREER MOBILITY AND
INCENTIVIZING EMPLOYEE RETENTION
BY KATY ROBY PETERS
" Where do you see yourself in the next
five years? " It's a common question
faced when interviewing for a new
job and asked by managers to gauge
individual development plans (IDP)
and career goals. A lot can happen in
five years, and if everyone answered
that question realistically - the answer
would be " not here. "
According to the U.S. Bureau of Labor
Statistics, from 2018-2020, the median
employee tenure for wage and salaried
workers hovers around four years.
valued, heard, seen and to have agency
(flexibility or a sense of control).
There are many ways to show people
that they are valued, heard, seen and
have agency over their workplace and
career, but as Pew Research found in
2021, the top five reasons why people
left their jobs in 2021 were:
1. Pay was too low.
2. No opportunities for advancement.
3. Felt disrespected at work.
4. Because of childcare issues.
5. Not enough flexibility
to
when to put in hours.
PEOPLE ARE
THE CORE OF
A BUSINESS.
With the mass exodus known as The Great
Resignation in full bloom, Gartner predicts
that U.S. employee annual voluntary
turnover is likely to jump nearly 20% this
year, from a pre-pandemic annual average
of 31.9 million employees quitting their
jobs to 37.4 million quitting in 2022.
Why Do People
Leave Their Jobs?
Four interconnected hallmarks of the
employee experience that dictate
whether an employee stays or leaves
a company include: wanting to be
| 46
The Hustle's study found that pay was
the number one reason people left their
jobs. The World Economic Forum and
McKinsey had similar findings, with pay
topping the lists as to why people decide
to leave their jobs, in addition to career
advancement. If those two reasons are
so common, why can't we invest more
in internal mobility and pay raises as
opposed to replacing new employees?
The Business Case for
Recruitment or Retention
We have heard repeatedly that exit costs
of an employee leaving are incredibly
high; " If you're hiring for a job that pays
$60,000, you may spend $180,000 or
more to fill that role, " writes Katie Navarra.
The performance and productivity
hit and sequential burnout remaining
employees might feel is not something to
choose
ignore. After all, people are the core of a
business. If the exit costs of an employee
can be three times the employee's salary,
what is the cost of a pay raise?
Companies are currently budgeting an
overall average pay increase of 3.4%.
However, the average salary bump for
leaving a company can amount to more
than a 30% increase. Pay compression,
also known as wage or salary compression,
" occurs when there's little difference in
pay between employees regardless of
differences in their respective knowledge,
skills,
experience
Inflation doesn't
or
abilities. "
Pay
compression can also be caused by pay
not outpacing rising inflation.
only
impact workers'
pockets and standard of living - the
increase in the cost of goods and
services affects business budgets as well.
Businesses can't just raise salaries without
also raising prices for their offerings,
reallocating budgets, restructuring or other
compensation measures. Unfortunately,
upskilling and reskilling are not always
the viable solution to protect against the
effects of inflation and looming layoffs, but
can be an effective countermeasure in
the right environment. Some companies
have a culture fraught with potential for
change agility and are adept at creatively
responding to change.
If the financial incentive for an employee
to build skills and experience and stay
at a company is less than what an
employee could receive for learning and
then earning elsewhere, any recruitment

https://www.wtwco.com/en-US/News/2022/01/us-employers-again-boosting-2022-pay-raises-wtw-survey-finds https://www.pewresearch.org/fact-tank/2022/03/09/majority-of-workers-who-quit-a-job-in-2021-cite-low-pay-no-opportunities-for-advancement-feeling-disrespected/#:~:text=A%20new%20Pew%20Research%20Center,quit%20their%20jobs%20last%20year https://www.wtwco.com/en-US/News/2022/01/us-employers-again-boosting-2022-pay-raises-wtw-survey-finds https://www.pewresearch.org/fact-tank/2022/03/09/majority-of-workers-who-quit-a-job-in-2021-cite-low-pay-no-opportunities-for-advancement-feeling-disrespected/#:~:text=A%20new%20Pew%20Research%20Center,quit%20their%20jobs%20last%20year https://www.insperity.com/blog/pay-compression/ https://www.bls.gov/news.release/tenure.nr0.htm https://thehustle.co/why-people-are-really-leaving-their-jobs-during-the-great-resignation/ https://www.weforum.org/agenda/2022/06/the-great-resignation-is-not-over/ https://www.weforum.org/agenda/2022/06/the-great-resignation-is-not-over/ https://www.gartner.com/en/newsroom/04-28-2022-gartner-says-us-total-annual-employee-turnover-will-likely-jump-by-nearly-twenty-percent-from-the-prepandemic-annual-average https://www.shrm.org/resourcesandtools/hr-topics/talent-acquisition/pages/the-real-costs-of-recruitment.aspx https://www.shrm.org/resourcesandtools/hr-topics/talent-acquisition/pages/the-real-costs-of-recruitment.aspx

Training Industry Magazine - Fall 2022

Table of Contents for the Digital Edition of Training Industry Magazine - Fall 2022