As the economy improves, the nature of the workforce in many
organizations is poised to be altered in ways that might not have
been anticipated. A recent survey from the Institute for Corporate
Productivity (i4cp) suggests that concerns over retention and
turnover weigh heavily on those who mange the workforce, including
a fear that key talent will walk out the door.
"If you look at the results of the survey, you see that employers
are already taking action to prevent turnover from occurring when
the recovery gets here," says Carol Morrison, senior research
analyst for i4cp. "A lot of businesses are concerned that that is a
To some extent, the fear of the exodus of the Baby Boomers from the
workplace, which made headlines for years, was stalled by the
economic meltdown. But that phenomenon is about to reignite, even
if it is going to be slightly altered.
"A number of Baby Boomers find themselves unable to retire or to
retire fully," adds Morrison. "But the overarching fact is that the
workforce as a whole is aging and the state of the economy can't
really reverse that. At some point the aging employees will have to
leave the workforce.
"Experts agree that the economy has slowed that exodus. It's likely
that we are going to see older workers stay on the job longer to
recoup lost financial resources. But we are also going to see
employers offer those older workers some means of transitioning out
of the workplace over a longer period of time."
Morrison also notes that organizations may find creative ways to
hold on to older workers. She described a program at Home Depot
that allows employees to work in one location part of the year, and
work somewhere else - such as warmer climates - in the winter.
"Flexible work schedules are helpful and job sharing will happen
more often," she says. "I don't think that the anticipated
retirement wave is going to go away, but I think it is going to
unfold much differently and more slowly than prerecession
Not just Baby Boomers
The loss of key talent, not just older workers, is a critical
concern for organizations, according to the i4cp survey. Notes
Morrison, "If you look at the results of the survey, you see that
employers are already taking action to prevent turnover from
occurring when the recovery gets here. A lot of businesses are
concerned that that is a viable possibility."
Not surprisingly, turnover tends to be higher among
lower-performing organizations, according to the survey.
"No matter what state the economy is in, organizations still need
qualified workers to function," adds Morrison. "They need them to
execute business strategies and to compete in the marketplace. They
are necessary to provide customer service and generate revenue.
Retention is a concept that has been around for a long time for a
When the economy deteriorates, organizations need to concentrate on
keeping those people who provide the greatest value, as well as
those who fill crucial positions.
"But that takes us back to the fact that workforces around the
world are aging and organizations are going to have to address it.
They have concerns about retaining that knowledge, so knowledge
continues to be an area of concern. Companies also need to invest
in retention to deal with the changes in technology that occur. As
technology changes, skill sets need to change."
But what do organizations fear most: losing their high-performing
employees or that their lowperforming employees will stay?
"Actually," notes Morrison, "most organizations fear both. The
survey explored engagement. Engagement and performance are closely
tied. Engaged employees feel a closer connection to their employers
and are more enthused about their work. They are more willing to
contribute above and beyond typical job parameters. Often those
engaged workers tend to innovate and serve as role models for
"For the low performers, the ones not engaged in their work, the
best case scenario is that they show up for work and get things
done. But the employees who are really disengaged can have a
tremendously negative effect in the workplace."
According to the survey, only 15 percent of the respondents said
engagement in their workforces has decreased. Hopefully that is a
sign that many workplaces have managed to weed out the low
performers," says Morrison. With the rounds of layoffs that have
occurred in many companies, it is less likely that many of the low
performers are left.
How are companies protecting themselves?
Among the strategies that employers are taking to hold on to key
talent, probably the most prevalent is increasing communication to
employees. "That's not just to prevent turnover, but also to keep
employees more engaged," explains Morrison. "This helps mitigate
some of the emotional fallout from the impact of the recession.
People are concerned over jobs, but also over personal finances and
other stresses related to the economy. Employers have told us they
are increasing their focus on talent management as a whole."
Many organizations that participated in the survey reported that
they are increasing leadership training for their line managers,
who are in closest touch with employees, and they have a greater
opportunity to interact with employees on an ongoing and daily
But one of the greatest challenges to any workforce, the toxic
manager, does not seem to be less present, despite a reduction in
general among workforces. "Logically you would assume that
decreases in the total workforce due to rounds of layoffs would
infer a similar decrease in these toxic managers," says Morrison.
"At the same time, the survey results indicate that toxic managers
are still a concern for employers. About a quarter of the
respondents told us that they are taking steps to eliminate toxic
managers from their organizations."
For high-performing firms in the survey, the rate was higher: about
three in 10 said they were taking steps to eliminate those people.
"But that is not just a (current) phenomenon," adds Morrison.
"About the same percentage of companies looking ahead said they
would be looking to eliminate toxic managers in the coming year.
That very clearly says that companies realize these managers are
still present, and that they need to be identified and (removed)
from the workplace."
Why more emphasis on succession?
Morrison was asked why succession planning seems to have leap
frogged to the top of the list of concerns for organizations. "The
(coverage) of the illness of Steve Jobs at Apple has been all over
the media," she notes, which exposed the danger of not having a
replacement in the pipeline. "Companies, especially those such as
Apple that are closely identified with one charismatic or visible
leader, tend to suffer if that leader is incapacitated or when that
leader is out of the picture.
"Savvy business leaders know that planning for succession is the
right thing to do. As a result of the current media blitz, it seems
to be more important, but it has always been on the minds of
"This survey shows that companies are looking ahead, and that is
very encouraging, explains Morrison. "I think that the proactive
approach bodes well," she adds."Most of the things I have read
indicate that when the economy does recover, it is going to be a
trickle back, not a big booming resurgence. This survey says that
companies are laying groundwork. Better talent management and
improved people policies are going to pay off in the long run, both
in terms of engaging their employees and keeping them on board."