Myth: Over 80% of employers believe that employees leave because of money.
Reality: 88% of employees leave because of things other than money.
A study titled “Retention of Key Talent and the Role of Rewards” by WorldatWork, Hay Group and Dow Scott, Ph.D., professor of human resources at Loyola University Chicago, found that the No. 1 reason key talent quits is to earn better pay elsewhere, although other reasons include a lack of promotional opportunities, the perception that pay is unfair and dissatisfaction with job and work responsibilities.
Not so fast! Contrary to this, an unpublished Saratoga Institute study of 19,500 former employees of 18 organizations, conducted from 1996 to 2003, revealed that 88% of employees say they leave for reasons other than money. By contrast, another survey in that same time period showed that 89% of managers believe that employees mainly stay or leave because of money. (The full Saratoga study is summarized in Leigh Branham’s book The 7 Hidden Reasons Employees Leave).
The top 10 reasons employees quit are listed as:
- Limited career opportunities (16%)
- Lack of respect/support from supervisor (13%)
- Money (12%)
- Lack of interesting/challenging job duties (11%)
- Lack of leadership from supervisor (9%)
- Bad work hours (6%)
- Unavoidable reasons (5 %)
- Bad employee relations by supervisor (4%)
- Favoritism by supervisor (4%)
- Lack of recognition for contributions (4%)
How to Keep Your Employees
Things to key into, according to Mark Toth include:
- Only 29% of employees are truly engaged (Gallup);
- Disengaged employees are 5 times more likely to leave (Cornell);
- Engagement is actually decreasing (Gallup, Conference Board);
- Pay doesn’t rank among the top four (4) engagement drivers (Right Management).
This confirms what I wrote here – Employees: Recognize Us or Lose Us – supervisors play a major role in whether employees leave or stay.
According to a Business Week (online) article from Feb.2, 2005, one of the biggest reasons people leave their employers is because of poor relations with their supervisors. Florida-based TalentKeepers has built their retention work on the premise that the most significant reason why employees leave is dissatisfaction with their direct supervisors. Other experts confirm that dissatisfaction with either supervisors or upper management plays a significant role in turnover. Despite this knowledge, managers and supervisors in most companies are still not held accountable for the departure of productive employees.
The Magical Wheel of Engagement
Employees want their leaders to:
- ENVISION a bold, clear and inspirational future;
- EMPATHIZE with them to understand their motivations and strengths;
- ENHANCE their skills through education, exposure and experience;
- EMPOWER them to do meaningful work;
- EVALUATE them on a truthful and timely basis;
- ENCOURAGE them as much as humanly possible
More detail on each spoke in the magical wheel is featured here.
Snap! principle of employee loyalty:
Have a model for engagement.