The layoffs, pay freezes, and budget cuts that organizations made during the Great Recession led to stressed out employees, many of whom are anxious about what's going to happen next. Those feelings are a strong predictor of turnover, according to a new report on "Predicting Pent-Up Turnover" by Sirota Survey Intelligence.
If employees don't feel changes were fair, and "if they don't see an optimistic future on the horizon for themselves and the organization, they are going to be more likely to leave," says Patrick Hyland, director of research and development for Sirota.
Voluntary turnover is an expensive but often preventable problem. A 2000 Costing Human Resources study by Wayne F. Cascio found that turnover costs range from 93 to 200 percent of an exiting employee's salary.
"In general, we look at survey data to see if employees are more stressed, if perceptions of fairness are on decline, and if they are able to balance work and life," says Hyland. "Those are all indicators that employees might be looking for other opportunities."
In a three-year study at one organization, Sirota identified nine indicators of employee commitment, and employees who scored those items low on surveys were considered "at risk." The next year, two-thirds of the employees who quit had been identified as "at risk" the previous year. In another organization, Sirota analyzed the attrition data of employees who left the previous year and contrasted their attitudes with employees who stayed with the organization. The employees who had resigned scored between 10 and 20 percentage points lower on seven critical retention survey items than the employees who stayed.
Hyland says the organizations most vulnerable to turnover made major changes - such as operational budget cuts, layoffs, restructuring, training budget cuts, and pay freezes - during the Great Recession. Managers can play a key role in helping to prevent turnover, according to Hyland. The most important thing to do now is to have managers connect with their employees, update employees on the status of changes that were made, and provide an optimistic vision for the business, he says.
"That one-on-one conversation can provide a good understanding of where an employee is and what he might be thinking or feeling," says Hyland. It's all about "how the organization dealt with the Great Recession, what it plans to put back in place, and how clear a picture for the future it is painting for employees."