According to the 2014 ADP Workforce Vitality Index, companies’ efforts to retain employees drive wage increases more significantly than the cost of recruiting new hires.
“In the third quarter of 2014, real after-inflation wages accelerated after years of stagnation, the report’s workforce vitality index showed,” said Larry Reynolds of Bloomberg BNA. “Hourly pay for private-sector workers was up 4.5 percent in the third quarter, compared with a year earlier.”
But of course, in many ways this development only highlights the fact that the cost of rehiring for vacant position can be exorbitant. Businesses realize that taking preventative measures by devoting resources to retention, while costly, can be less so than the alternative.
Nels Olson, vice chairman and co-leader of the board of executive recruiting company Korn Ferry, believes that the recent rise in bonuses and salaries can be attributed to companies’ desire for turnover prevention. But relying solely on those two things to keep your most valued employees is many times not enough. Over 40 percent of employees believe that believe that their companies do not do a good job in explaining their pay programs, according to the 2014 Towers Watson Global Workforce Study.
The disconnect between employees and their employers is something that will be addressed around the business world by human resources departments. Many departments, however, are so bogged down by the managerial duties associated with things like background checks or scheduling that they can’t devote any time to bridging that divide.
HR software systems, through the automation of tasks like those, offer a way to do that. Let the people of HR Software Solutions use their expertise to help implement and manage such a system for you.