We’re all about the exits this week. And there have been some truly painful ones of late. Where Kim Kardashian and her posterior recently failed narrowly to break the internet, the exit of Zayn Malik from One Direction appears to be giving this another go. Whilst Australia were taking the plaudits following a successful cricket world cup this week, England’s exit, some considerable time before the final, resembled far more a whimper than a bang, following a series of defeats to such powerhouses as Bangladesh.
The recent Greek election and the forthcoming UK version have also thrown back into focus other important exits. Will the increasingly frosty German-Greek dialogue see a Grexit from the EU? And how will our own election influence a potential Brexit?
Putting perhaps all these exits into the shade was that of Mr Jeremy Clarkson. Following an altercation with his Top Gear producer, allegedly over a disappointing post-filming menu selection – a classic tale of employee lack of recognition and subsequent disengagement – the not insubstantial Mr Clarkson walked out of Top Gear and presumably the BBC.
Similarly walking tall apparently is the UK economy, according to a budget-announcing George Osborne. And there is much to support his position. Unemployment is down to 5.7% – and forecasts suggest this might decline even further to 5.1% by the middle of the year. GDP for 2014 was revised up this week to 2.8% – the best performing major economy in the world. And just this week, figures for disposable income and financial confidence were all up. Undeniably handy for Mr Osborne with 37 days to go to the election.
So, with every possible encouragement, given a perkier, more confident retail and corporate customer, are UK employers walking tall?
Attempts to do just that are likely to be encountering a rather painful if figurative stone in the shoe. Messrs Malik and Clarkson are not the only employee exits. According to Robert Walters, their finance division has a growing 10,500 vacancies on its books, but only 6,000 job seekers. This was echoed earlier this week by the APSC, which suggested there were a sizeable 21% more vacancies on its recruiter member’s books in the economy compared to year previously. Adzuna came up with some even more eye-watering statistics when it announced the number of advertised vacancies was just 7,000 less than the million mark.
And we can only anticipate more exits from UK employers, given that wage increases remain notably subdued according to Chris Williamson at Markit. The key exception to this were individuals changing jobs – ‘The only real signs of rising pay pressures are among new hires’. So the message for many potentially disengaged employees implies that healthy salary increases are only possible through changing employers.
For Delta Emerson at Ryan LLC, this is hamstringing those organisations that now feel confident enough to walk tall – ‘The exit of institutional knowledge (makes it) difficult for a company to achieve aggressive visions with constant churn’. This was backed up by some fascinating metrics from the US – the Labor Department noted earlier this month that the number of employees voluntarily exiting their jobs was up 17% year on year. With a huge amount of institutional, operational and client knowledge walking out of organisations at increasing speeds, perhaps it’s no wonder productivity levels continue to frustrate.
And who better than the Economist to have the final word on employee exits and the implications for ambitious employers – ‘Corporates have almost forgotten what it is like when people are a scarce resource. It is time to remember’.
Employee behaviours and exit activities will vary from sector to sector – those within oil and gas will feel more inclined to sit put than employees within a digital setting, for example. And it is unlikely, as well as inadvisable, that your people will be adopting a Clarksonesque approach to their exits. But exit many will if they feel the cultural, professional and remunerative recognition they are receiving doesn’t match up to raised expectations.
With wage increases still unfathomably low, it would appear that many employers feel the labour market is as it was in 2011. If they don’t wake up to the fact that great talent is more of a scarce resource than at any point in the last seven years, their approach to a benign and positive consumer outlook will resemble more of a stunted limp than a brisk, confident and upright walk.
Getting to the heart of your employee mindset 