SMEs record highest resignation rates

Businesses report impacts of an employee’s resignation include increased stress, reduced staff morale, loss of corporate intelligence and reduced customer service and productivity.

The Australian Institute of Management (AIM) 2016 Staff Retention Report (SRR) has uncovered an increasing concern about staff retention among Australian businesses, with SMEs recording the highest resignation rates overall at 12.6 per cent.

Developed to take a deeper look into current market trends around staff retention and the impacts of staff turnover, the report was based on finds from the AIM 2016 National Salary Survey (NSS), released earlier this year, which revealed four in five Australians are unhappy at work.

Turnover can be a threat to business in a multitude of ways. Businesses report impacts of employee resignations include increased stress, reduced staff morale, loss of corporate intelligence and reduced customer service and productivity. In addition to this, businesses are also faced with the financial burden of recruiting and training new staff.

The AIM 2016 NSS reveals that the three most common reasons staff voluntarily move to another organisation are:

  1. seeking a new challenge
  2. limited opportunities for career progression
  3. insufficient financial reward.

To combat this, AIM has analysed the NSS to identify specific human resources strategies and approaches to assist companies develop and retain good talent, with the aim of reducing resignation rates to lower than the market average.

David Pich, AIM Chief Executive Officer, encourages business leaders to reassess their current pay model and suggests creating a positive and inspiring workplace culture, to help decrease staff turnover and retain human resources.

“Retaining staff is no easy feat. Employees can become restless in roles that have limited career advancements or where they don’t enjoy their time at work. To motivate and engage staff, managers and leaders need to understand the motivations of their employees and implement strong tactics to keep valuable team members,” Pich said.

It is also vital for managers and leaders to stay across current market trends to ensure they make informed decisions. For these reasons, the NSS and the SRR are must-haves for decision makers.

Now on its 52nd year, the NSS surveys more than 500 organisations across Australia, covering more than 25,000 employees and 270 job roles.

Inside Small Business