40% of employees want to quit job - survey

Two out of five employees in Irish and UK companies are actively considering leaving their current employer within the next 12 months, according to new research by Watson Wyatt.

Watson Wyatt's Total Reward Survey 2004, which included a number of leading Irish employers, found the main reasons given by employees for looking to move company include a lack of career development and promotion prospects, a poor working relationship with their manager and a lack of opportunity to be creative.

"This contrasts with the more politically correct reasons given by employees when they actually leave such as job satisfaction, better pay and better opportunities," said Mr Raymond McKenna, head of total reward consulting at Watson Wyatt in Ireland.

"Rather than develop a retention strategy geared to these latter points, there may be more value in companies focusing their efforts on ensuring employees do not feel the need to look elsewhere."

The survey found that almost 80% of employers in future intend to take a more holistic approach to managing their reward programmes.

The research also highlighted that the key elements of reward which have the greatest influence on positive employee behaviours - including commitment levels - are the non-financial elements of the reward programme such as career development and promotion prospects and increased flexibility, as well as a pay structure truly aligned to performance.

The survey, which combined the views of over 220 large Irish and UK private sector employers and nearly 3,000 employees of such organisations, challenges the appropriateness of providing above market levels of traditional rewards.

It showed that there is no material impact on employee turnover levels in doing so and perhaps greater value could be found by reinvesting additional funds available in some of the intrinsic elements of reward.

The Watson Wyatt survey also shows that the trend towards more "pay at risk" continues. However, with only 40% of employees either motivated or believing their performance has improved as a result of their current bonus plans - through design or performance management - further work is required in this area before target bonus levels should be increased further.