Research by Octopus Money, the company working to give everyone access to 1-to-1 money advice, suggests that UK businesses are in the midst of a retention crisis, with leadership largely unaware of the scale of the problem.
Despite nearly half (46%) of employees revealing they plan to look for a new job this year, 60% of the C-suite think their workplace is prepared to meet the needs of the future workforce.
The independent study, carried out by Censuswide* for Octopus Money, further illustrates how deep-rooted this issue is. By their own admission, the C-suite aren’t focused on retention, with 42% seeing the cost of running the business as their main priority. HR tend to agree, with 52% saying the C-suite is too focused on other business issues to tackle retention.
The research revealed a big disconnect between business leadership and their employees. This has been exacerbated by the cost of living crisis, where businesses have struggled to give employees the pay rises they want. However, the data suggests workplaces have been unsuccessful in compensating for this in other areas of their benefits strategy: 42% of the C-suite agree that their benefits are ineffective at retaining talent, but neither they nor employees agree on why this is. 31% of the C-suite think that employees don’t even try to understand them, whereas 80% of employees say they do, but simply don’t see the added value.
HR have found themselves as the mediator in this disconnect between the C-suite and employees, and say they’re facing increased pressure to deliver: 62% say expectations are much higher this year. In fact, one contributor to the employee-leadership divide may be the C-suite’s overly positive view of HR’s reputation. 65% say that HR are very useful in innovating the employee value proposition, though employees do not feel the same: as many as 63% say that they don’t believe that HR adds anything to their experience as an employee.
In a final twist to the C-suite’s retention problem, HR are much more likely to look for a new job compared to the rest of the workforce (57% vs 46%), meaning that the C-suite risks losing both their top talent, and their employee mediators.
Anasuya Iyer, Chief Commercial Officer at Octopus Money said:
“Faced by rising costs, and employees job hopping for higher pay, I often hear from companies that they’re struggling to work out how to use rewards and benefits other than salary and bonuses, to retain their staff. The reality of the retention crisis is stark: with nearly 1 in 2 employees job searching, businesses could end up spending more on rehiring and retraining than implementing the right benefits strategy in the first place.
They need to overlook their preconceptions of why employees won’t engage. Instead they should look at retention as something they can earn by supporting employees during key life moments that almost everyone goes through, like promotions, parenthood or divorce. Out of the businesses we work with, the ones that see the most success are the ones that have leadership buy-in from the top for this kind of strategy, and, instead of just letting HR do the dirty work, shows employees how their benefits strategy will help them get to where they want to be in life.”
In uncertain economic times, employees’ financial health is business critical. Find out how to increase retention and boost employee engagement by giving 1-to-1 money advice to every employee here: www.octopusmoney.com
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