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HR Barometer - Series 5.1 now available on Linea

Employee turnover at its lowest in five years, according to research
Employees leaving Covid hit businesses to seek career changes creating employee shortages

High risk of pent-up employee attrition to potentially impact businesses

One third of employers experienced workplace dispute, despite many employees working remotely

Jump in the number of businesses planning salary increases this year

The latest HR Barometer Report has been published by Adare Human Resource Management which highlights some of the ongoing impacts of Covid-19 on the Irish employment landscape, particularly some issues affecting ‘Covid hit’ businesses, such as those in the hospitality sector.

Employee Turnover

The rate of employee turnover decreased dramatically in 2020 with an average of 8.3%, down from 17% in 2019 and is the lowest in five years[1]. However, the average employee turnover is higher for ‘Covid-hit’ businesses, such as those in hospitality, standing at 10.6%. When asked about expected employee turnover for this year, the average is 7.5% but again higher for ‘Covid-hit’ businesses with an average turnover for 2021 of 9.8%.

“Career progression” is still the most cited reason for employees leaving their roles, with 35% of businesses stating it as the reason people moved on from their roles. “Change in career” has increased dramatically from 3% last year to 15% in 2021’s report. And, as reflected in what Covid-hit businesses are saying about staff shortages, the research found that those in these impacted sectors were twice as likely to leave for the reason of career change; 22% for ‘Covid-hit’ vs 10% other businesses.

Flexible & Remote Working here to stay

Six in ten (63%) of Organisations state that they have employees working remotely, with one in three (28%) having at least half of their workforce working remotely. While this is down slightly on our findings from last year with 90% of Organisations with staff working remotely, it is a signal that many employers are requesting staff to come back to their workplaces.

However, three quarters (76%) now have flexible working arrangements in place with nine in ten (92%) of larger Organisations offering flexible working. This is double the number (38%) of Organisations that had arrangements in place pre-Covid so there is a clear indication that flexible and remote working is here to stay.
And, when asked about initiatives to help employee retention, “Flexible working” was the top initiative at 39%.

Salary increases 2021

The findings from the current HR Barometer indicate a return of optimism and confidence in terms of salaries. Four in ten (41%) of businesses stated that they had or intended to increase salaries this year. When asked the same question in August 2020, just half that number (22%) said yes.
The average salary increase for 2021 as per the report is 3%, a potential incentive to attract and retain employees.

 “Company affordability” (36%) and “Company Profitability” (32%) are the two main factors on which salary increases are contingent. Nearly a quarter (23%) are linked to External Pay Scales. And, just 15% of salary increases are based on performance.

Decrease in Workplace Conflicts & Disputes

Just one in three (33%) of Organisations stated that they experienced employee related disputes in 2020, this is down considerably on the previous year when eight in ten had to deal with an issue. This is most likely due to the fact that most Organisations have employees working remotely, the third party fora WRC and Labour Court have not been at full capacity and employees, unions and Organisations have been focused on the operational challenges arising out of Covid.

Discipline continues to be the main form of dispute within the workplace with nearly 1 in 5 reporting a discipline issue. This is a trend that we’ve seen over the past five years and while there was an unusual spike last year, the percentage has been relatively consistent.
Given the re-opening of businesses and the level of anticipated changes to take place within Organisations, it is envisaged that unfortunately there will be an increase in the number of disputes over the coming 12 months.

HR Priorities 2021

“Addressing Covid-19 challenges” is the top HR priorities for Organisations, moving up from third in the last survey. “Retention” and “Employee Health & Wellbeing” are second and third. The top 6 HR priorities are:

  1. Addressing Covid-19 challenges

  2. Retention

  3. Employee Health & Wellbeing

  4. Performance Management

  5. Employee Engagement

  6. Future of Work

Would you like more information?

If you are not a Linea member and would like to gain access to the complete findings of the HR Barometer Series 5.1, please contact us at info@adarehrm.ie and a member of the Adare Human Resource Management Team will be in contact with you as soon as possible.

[1] Average Employee Turnover, HR Barometer: 2020 – 8.3%, 2019 – 17%, 2018 – 14%, 2017 – 10%, 2016 – 11%

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