Employee Engagement Down; Hiring on the Upswing

Mercer’s 2012 Attraction and Retention Survey found thatover 40 percent of employers are hiring on more employees this year compared with 2010 where just 27 percent reported the same. The number of employers cutting staff has also fallen significantly over the past two years with 16 percent of employers reporting layoffs compared with 25 percent in 2010. However,24 percent of respondents said employee engagement levels are falling, compared with 13 percent in 2010.

“Employee loyalty has been eroding the past few years due to companies’ responses to the economic downturn,” says Loree Griffith, principal with Mercer’s rewards consulting business. “Actions like layoffs, pay freezes and limited training opportunities have created an evolving employment deal for employees due to uncertainty about what is expected and how employees will be rewarded. Meanwhile, firms are still aggressively managing people costs while finding ways to re-energize and re-motivate engaged employees.”

Nearly two-thirds of employers foresee an increase in voluntary turnover as the economy improves and market demand increases for certain skill sets. Some of these jobs currently in higher demand include information technology, research and development, scientific engineering, and senior management positions.

“Employees with the ‘right’ skill sets are in demand,” says Griffith. “Despite the increase in hiring, many firms are experiencing talent shortages due to critical gaps between skills employees possess and skills businesses need. Now more than ever, firms need to engage and develop their high-potential employees and critical work force segments.”