the recession, as those who didn’t get
fired were forced to work much harder.
Nearly one in three ( 32 percent)
U.S. workers is seriously considering
leaving his or her job, according to
a 2011 survey by HR consultancy
Mercer. That’s up from 23 percent in
2005. Meanwhile, another 21 percent
are not looking to leave but view their
employers unfavorably.
“People are saying, ‘it’s got to be
better someplace else,’ “ said Gene
Tange, president of consultancy
Pearl HPS. “If a company treated
people poorly and laid people off
like disposable assets, they will
experience disproportionate turnover
when the economy turns around.”
“Once that starts happening,”
he continued, “quality, revenue and
earnings will go down.”
Workers, it seems, are no longer
loyal to their companies, but are
instead loyal to the next rung in their
career ladders.
“THERE IS A PENT-UP DESIRE TO GET TO
THAT NEXT POSITION. LOYALTY IS NOT TO THE
COMPANY ANYMORE. LOYALTY IS TO YOUR
CAREER. WHOEVER LETS YOU DO YOUR DESIRED
JOB, THAT’S WHERE YOU’RE GONNA WORK.”
—Economist Joel L. Naroff
to worry company leaders. In Lloyd’s
Risk Index 2011, senior leaders
identified it as their second highest
priority, while it had been their 22nd
highest priority just two years earlier.
“This is absolutely top of mind,”
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said Howard Mills, chief adviser to
Deloitte’s insurance practice. “It’s
been a rough couple years. Plus
insurers, and other companies in all
types of industries, are looking to hire
away and poach from competitors.
Many companies are giving serious
thought to retention strategies.”
Companies also find themselves
in a catch- 22 with regard to baby
boomers. If the economy improves
enough that boomers stop delaying
retirement, then it will lead to an
epic knowledge drain. If the boomers
stick around (as they have during
the recession) talented employees
in positions underneath them will
continue to be frustrated because
they can’t advance—and high-
potential employees will leave.
“When they don’t see turnover
at the top, the next generation of
leadership cannot move into those
jobs,” said Mills. “They’re under the
‘gray cap.’ “
Another demographic shift
hurting the talent market is the sheer
number of Millennials, people born
between 1980 and 2000, entering the
workforce. Experts estimate that this
group will make up 50 percent of the
workforce by 2020, and while they
certainly have potential, they will
not have much to offer in the way of
experience.
Narofff doesn’t believe that a
turnover tsunami would drive the
U.S. back into recession, but he
said it will make a dramatic effect
on businesses’ bottom lines because
they will lose their ability to be
flexible, meet growing demands and
innovate. They will instead be forced
to spend time and money on job
searches and training.
The insurance industry could be
specifically affected by the talent
shortage, as talented underwriters
and actuaries could become hard to
find, said Mills.
To prevent a talent shortage in
the future, risk managers and human
resources executives will have to
get more creative in their retention
packages, focusing on things like career
advancement, telecommuting and
stressing work/life balance, said Mills.
JARED SHELLY is senior editor/Web editor
of Risk & Insurance®. He can be reached at
riskletters@lrp.com.
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• Hundreds of young employees are
itching to move up the career ladder
and are ready to bolt at the first sign
of an improving economy.
• That talent gap is starting to worry
some corporate leaders, who will
find skilled talent difficult to replace.
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