Ask employers why people quit a company and 9 out of 10 will tell you it’s about the money. Ask employees the same question and you’ll get a whole different story. PricewaterhouseCoopers (PwC) discovered this when they asked 19,000+ people their reasons for leaving as a part of exit interviews they conducted for clients. The top 10 reasons why employees quit? Check out the responses below.
As reported in (2005) The 7 Hidden Reasons Employees Leave by Leigh Branham, page 21, Figure 3.1
Yes, compensation was a factor in 12% of the cases, but look at some of the other issues that drove people away—growth, meaningful work, supervisor skills, workload balance, fairness, and recognition—to name a few.
What type of environment are you providing for your people?
Author, speaker, and consultant Leigh Branham, who partnered with PwC to analyze the results of the study identifies that trust, hope, worth, and competence are at the core of most voluntary separations. When employees are not getting their needs met in these key areas, they begin to look elsewhere.
Wondering how your company would stack up in these areas? Here are a couple of questions to ask yourself. How would your people respond if they were asked to rate their work environment in each of the following areas?
- I am able to grow and develop my skills on the job and through training.
- I have opportunities for advancement or career progress leading to higher earnings.
- My job makes good use of my talents and is challenging.
- I receive the necessary training to perform my job capably.
- I can see the end results of my work.
- I receive regular feedback on my performance.
- I’m confident that if I work hard, do my best, demonstrate commitment, and make meaningful contributions, I will be recognized and rewarded accordingly.
Don’t wait until it’s too late
Better compensation is only a part of the reason why people leave an organization. In most cases it is a symptom of a more complex need that people have to work for an organization that is fair, trustworthy, and deserving of an individual’s best efforts. Don’t take your people for granted. While you may not be able to provide the pay increases you were able to in the past, there is nothing stopping you from showing that you care for your people, are interested in their long term development, and are committed to their careers.
Interesting results. We drew very similar conclusions based on results of our own study on career motivators. The top five motivators in our study were: Customer Orientation (desire to make customers happy), Achievement (desire to work in a goal-oriented and challenging work environment), Inspiration (desire to inspire others through one’s work), Identity and Purpose (desire to work in a company/field that is in line with one’s values and ethics), and Fun & Enjoyment (desire to work in a position/corporate culture that is inherently entertaining). Financial Reward took the 12th spot.
Career motivation study press release: http://corporate.psychtests.com/media/pr_psychtests_career_motivators_test.html
Indeed. It appears to be a global thing that employees’ priorities do vary and change as the circumstances around them change. I believe this study clearly ties in with Maslow’s hierarchy of needs, where need for creativity and development (self actualization) comes at the top of pyramid and need for safety (employment) at a later stage. I believe that we as humans tend to move on to satisfy the next level of needs once one level is realized. I think this applies to the study, reflecting that the at the top of the reasons as to why employees choose to leave is the need for self actualization and Esteem.
As human beings, we need to feel attached, seen and noticed. We need to see, feel and know that others around us realize and appreciate our work, trust us and count on us. It has to do with our own existence. By end of the day, employees are “Humans” and Maslow’s law applies to them.
Let’s take care of employees for them to take of our customers and of us as well.
Reblogged this on Geeks Share Space.
So true. There are at least 29 better predictors of employee turnover than pay and pay satisfaction. I touch on this in “Give ’em a raise,” (http://managementdocandpoet.wordpress.com/2012/05/25/giveem-a-raise/) and dispel various other employee retention myths in “Managing Employee Turnover.” http://www.amazon.com/Managing-Employee-Turnover-Strategies-Management/dp/160649340X
Thanks for the data. Your data is certainly not surprising given that studies show about 70% of all employees are disengaged or actively disengaged. This high percentage of disengagement is not surprising since studies also show only 4% of all problems are known by top management while 100% are known by those doing the work. All this seems to make sense since the vast majority of companies are using the traditional top-down command and control approach to managing people.
In my own years of managing people, I learned that people are about 4 times more capable than we give them credit. But they won’t unleash all that creativity, innovation, and productivity unless management meets their five basic needs: to be heard, to be respected, and to have competence, autonomy, and purpose (these last three being what motivates us all, thanks to research by Edward Deci and Richard Ryan).
It took me quite a few years to learn how to meet those needs 100%, but when I did the results were simply too amazing to believe at first. The means to achieve this state of nirvana for both management and employees were quite simple. Just give them more than enough opportunity to voice their complaints, suggestions and questions and respond to those in a timely fashion to the satisfaction of the originator and all others affected.
Hi Ben,
Thanks for your comments and for highlighting the work of Edward Deci and Richard Ryan. We are big fans of their work also and we are currently looking at how Autonomy, Relatedness,and Competence can be incorporated into creating motivating environments for employees. For people who may not be familiar with Deci and Ryan’s work on self-determination theory, here is a link to the listing at Wikipedia. It provides a good overview of their work: http://en.wikipedia.org/wiki/Self-determination_theory
Very True findings
At the risk of contradicting an interesting set of findings, let’s explore this list further:
Limited career / promotion opportunities (16%) = I’m not going to be able to make enough money quickly.
Supervisor lacked respect / support (13%) = My boss doesn’t value what I do here and isn’t getting me enough money.
Work hours (6%) = They’re not paying me enough money to work this much.
Supervisor displayed favoritism (4%) = My coworker makes more money than I do.
Not recognized for my contribution (4%) = I did a great job on this project and didn’t get any money for it.
Add these to the 12% who attributed their departures to compensation, and the percentage of departures related to money shoots up to 55%.
Could money also be a factor in departures related to a job getting boring, or a supervisor lacking leadership skills? You bet.
Also, the chart doesn’t add up to 100%. Could money be a factor in the rest? Absolutely.
A great boss who meets / exceeds / helps to fulfill a predetermined hierarchy of needs might be wonderful to have, but at the end of the day, if this person isn’t going to financially reward their performers, they’ll wind up seeing many of them leave.
Hi SW,
Alternative points of view are always welcome and I appreciate your suggestion we take a second look at these issues through the lens of compensation. I think you bring up a very common reaction that many people feel at work which is basically, “They don’t pay me enough to put up with ___________.” This is where many people will insert issues related to workload balance, mind-numbing job, or bad boss.
Sometimes money will cover-up these issues in the short-term. Of course, money is in short supply these days and the cracks are beginning to show in many organizations. Compensation is definitely related to all of this but I still think we should look at it as a separate issue. There is a lot of research that shows that money is a part of the equation–and an important one–but it is not the only factor that goes into creating a good place to work.
Thanks also for asking about the percentages adding up to 84% instead of 100%. There are nine other factors that were given as reasons for leaving in the exit interviews at a percentage of 3% or less. Here is the rest of the list in descending order: Poor working conditions, Training, Supervisor’s incompetence, Poor senior leadership, Supervisor’s lack of technical skills, Discrimination, Harassment, Benefits, and Co-workers attitude.
Thanks again for your comments!
I totally disagree. Promotions are for more challenges and responsibility. Respect is just that, respect for what I contribute, I don’t care if its a $8,00/hr job or $35/hr. Favoritism based on friendship not work performance, its called brownnosing, work hours because I have a life outside of work. Recognition for contribution comes back to respect for the worker. Boredom has nothing to do with $$$$, being a spark watcher is boring no matter what the pay. It doesn’t add up to 100% because its only the top 10.
Spot on. There was a new postal worker that kept complaining he should be the boss. And the new nurse who thought she deserved more respect from her patient. Yes, patients. Her will ill and vulnerable and couldn’t properly massage her soul sucking ego. Don’t forget the obese employee who broke 2 chairs during her shifts and never considered the ramifications of how this affected others who then had to sit on broken chairs until replacement came. Not a shred of remorse or hey guys, maybe I shouldn’t weigh 350 lbs without asking for an accommodating chair. And wanted to elevate her tired legs , laying her filthy shoes on other people’s desks and chairs. It’s never enough for some people. Or the guy who was constantly gossiping and causing drama at work. He was told to keep it positive. His idea of keeping it positive was to write a scathing letter about every single employee and how they didn’t “respect him.” Despite him constantly belittling others and violating privacy of patients. No matter how much you do for some employees, they are soul sucking fools looking for a place to hide and an opportunity to exploit. Weed these MFks out.
Thing to be noted is the role of Supervisor though with different scenarios. So do we go for a computed total score as average doesn’t work to say that Supervisory issues galore!
Hi Santhosh–If you add up all of the reason’s specifically attributed to immediate supervisor, the total comes out to 33%. That’s a big percentage!
I agree. I work in an organization that talks about Ken Blanchard,.. and the management is so far from those principles, it’s a joke!!!!!!!!!!!! the 30 something managers blister and condemn people and then run to their bosses complaining that they are frustrated because their subordinates are not motivated. So now HIS solution after whining to his boss is for her to per all of his failures on CAP s… corrective action plans in order to meet their “matrix”/ goals. Ken realllllly needs to look in the back yard that has his name on it!
I have seen similar statistical reports on this subject before, and after 30+ years in staff supervision and management, I can attest from first hand experience to the validity of the report. I find myself frequently reminding myself that “People don’t care how much you know until they know how much you care”
Interestingly, the same is true with regard to customers a study I read years ago and have recently re-discovered examines the customer relationship and why customers stop being customers. ( or in the case of service providers who have a monopoly, why customers speak negatively about the service provider) places relationship or concern for the customer/provider relationship at the top of the list.
see this easy to follow graphic: http://www.thewebcitizen.com/wp-content/uploads/2011/06/fastest-ways-to-lose-customers.png
and this article:http://www.bautomation.com/resources/articles/startling-statistics-on-customer-retention-acquisition/489/
Thanks for your post Chief Hagarty, it never hurts to be reminded.
Frank,
Spot on comment re customers operating the same as employees. After all, employees are customers, customers of the boss’ support. If that support is less than stellar, employees will object or try to get it better and if there is no respectful response from management, the employee becomes turned-off.
best regards, ben
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The Supervisor is the SINGLE largest remediable factor. Read – SuperVision for the SuperWiser Front-line Manager. http://lnkd.in/KjCNqW
Please see my short blog and graph for more information on my research in public sector
http://alturl.com/9tami
I’m almost disappointed to see “job duties boring/no challenge” doesn’t have a higher percentage. On the other hand, it’s good that people aren’t settling and want to be challenged in their work.
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It is surprising not the earnings are on the first place but people with good qualifications can quit and find another job easily. They just write a fine resume (I don’t think they need any ideas but if so, there are numerous tips on the Internet how to write a killing one – here is my preferred one: http://moneyland.time.com/2012/04/13/how-to-make-your-resume-last-longer-than-6-seconds/) and voila, they are working on a better place in a heartbeat. Yea, obviously, skilled people have the need of better career opportunities.
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Hmmm. I suspect that many surveys are done in the larger corporate companies (I’m prepared to be corrected?). I’ve left 3 jobs because I was being screwed (not in any of the above)…and I bet I’m not alone!: Repeated delayed repayment of legitimate expenses. Commission not paid, because the goal posts changed when they realised how well I’d done. What about, they fired me (I was on 147% of target) for, I quote: “Not being hairy arsed enough with my customers” (Hermes Abrasives).
Yes I’m (a bit) bitter – why would you expect someone to want to be “engaged” in a company, when there is repeated exploitation – employees are money making assets, pay them as little as possible for maximum returns – no one employs people for love (well very few). There are very few companies that actually truly care for the individual…and you think that employees don’t know that??
I also suspect that very few employees give a real explanation for leaving (bullied, character clash, etc) because they still need a reference from the company they’re leaving. Even after they leave companies will still have them by the “short and curlies”.
Call me a cynic (read some of the Scott Adams “Dilbert” cartoons – they can be surprisingly accurate), but I’ve been managing for too many years to put too much credence on just one isolated bit of survey feedback – the whole picture and perspectives need to be moulded together to get to the real truth, often in a less than scientifically repeatable way, (yes I do believe in gut feel) but I would say the results above really are not too meaningful.
I think financial rewards and good human relationship goes a long way in staff retention. Unfortunately in the number chasing game in many organizations, often we forget to put the human touch in the course of performing our duties as well as not enough rewards to staff who done a good job!
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OK, I probably have a different reading of this to everyone else. What this says to me is that the vast majority of companies fail many of their employees. Of course, not everybody can have the promotion they want, but there exists a seniority snobbery in some companies whereby unless you have a certain rank, your ideas are not appreciated or even not welcome. But you can’t rise to that rank without demonstrating your value … and so it goes.
Of course one would expect senior executive to have lots of good ideas, that’s one of the things that they’re paid for. But that isn’t to say that the cleaner, or the receptionist, or the night watchman, or indeed anybody at all, can’t have ideas worth listening to. It’s the willingness to listen to everyone and harvest the best ideas that sets great companies apart from the adequate ones.
unfortunately in many organizations the main focus of human resources is to meet the needs of the board, instead of playing the role of connecting the staff needs with the interests of the board to obtain results. becasue, without staff the board will not obtain the results wanted.
Beth,
I wish that Ken would tell everyone how damaging the command and control approach to managing people and how amazingly effective it opposite, call is autonomy and support, is. Command and control tends to demotivate, demoralize, and disengage employees no matter how well it is gussied up with incentives and rewards. Autonomy and support creates a highly motivated, highly committed and fully engaged workforce with high morale and innovation literally loving to come to work and at least 300% more productive than if poorly engaged. At least, that was what happened the last time I used it. We sorely need Ken to repeatedly tell everyone this since only he has the clout to make people listen.
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Spot on with this write-up, I honestly think this web site needs a
lot more attention. I’ll probably be back again to
read through more, thanks for the advice!
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