Companies brace themselves for staff attrition as economy improves

Companies brace themselves for staff attrition as economy improves
Channel NewsAsia

SINGAPORE: Companies are bracing themselves for staff attrition as the economy improves. A poll by global management consultancy, Hay Group, said they are doing so by investing to retain high performing employees.

Dr Stephen Choo, regional director of Hay Group Insight, said employees in Singapore feel that they have stretched themselves to the limit to help their companies in the downturn, and a talent exodus might happen if nothing is done to reward and recognize the sacrifices made by employees.

According to Dr Choo, companies need to think of more ways to engage their employees.

"Talent are certainly very motivated to remain with the company if there are lots of development opportunities — that the company could actually work with them in terms of enhancing their skills and talent," said Dr Choo.

"Also, training is very important. Certainly leadership is still very important because lots of talent are motivated to stay with the company if there is a good role model they can look up to," he added.

Other motivating factors include offering employees more resources to work with, creating an environment that promotes greater teamwork, and also giving them more empowerment and authority.

Dr Choo said that companies polled are planning on average to give a salary increase of 3 per cent in 2010, as compared to 2.3 per cent this year.

The sectors doling out the highest salary increases will be the Oil & Gas, Chemicals and Insurance sectors.

The poll also showed that the percentage of companies cutting or freezing pay has dropped from 58 per cent in March to 18 per cent in October.

According to the Hay Group’s survey, variable bonuses for this year will remain modest at 1.8 months, and are forecast to be marginally lower at 1.5 months in 2010. The lower bonus predicted in 2010 is due to the unclear economic outlook for the next three to six months, explained Dr Choo.

He said: "As a whole, most industries are quite conservative about their forecast because there is no clear indication at this point in time that the economy is certainly moving up north.

"What we can see so far is that there are conflicting stories about some industries seeing an upturn, but at the same time there are also companies which are laying off staff as well."

— CNA/sc

- wong chee tat :)