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The previous two chapters focused on the processes used to mobilise a workforce, activities which are often expensive and time consuming. It is estimated that the costs associated with recruiting and training a new employee average between half and one and a half times the annual salary for the post in question, depending on the approaches used (Branham 2005: 3). In this chapter we consider the most important ways in which HR managers seek to maximise the return on this investment, that is by seeking to maximise levels of employee engagement and to minimise levels of voluntary staff turnover.

 While use of the term ‘engagement’ in the context of the worlds of work and employment has often been imprecise and nebulous, most would agree that a workforce which is ‘engaged’ or, better still, ‘actively engaged’ is much more likely to be productive and to meet its objectives than one which is either ‘disengaged’ or ‘actively disengaged’. It follows that enhancing levels of engagement, for all the confusion about what precisely this means, must be a major aim of any professionally managed HRM function.

 Similarly, while arguments about the wisdom of investing extensively in initiatives aimed at maximising employee retention rates can sometimes be finely balanced, it is clear that for most organisations, most of the time, the loss of talent in which investment has been made is damaging. It follows that HR managers are right to view levels of voluntary staff turnover as a means of judging the success of people management in an organisation and are right to be concerned when the number of voluntary resignations rises higher than that of their major competitors.

 Engagement and retention strategies

 The straightforward answer to the question of how best to retain staff is to provide them with a better deal, in the broadest sense, than they perceive they could get by working for alternative employers. This will also help to engage them. But it is much more than a question of getting the terms and conditions of employment right.

 There is also a need to provide jobs which are genuinely satisfying, along with career development opportunities, as much autonomy and involvement as is practicable and, above all, competent line management. Indeed, it can be argued that most of the practices of effective HRM described in this book can play a part in enhancing engagement and reducing staff turnover. Below we look at five interventions that can be shown to have a positive effect.

 Family-friendly HR practices

 Labour Force Survey statistics show that between 5% and 10% of employees leave their jobs for ‘family or personal reasons’ (IRS 1999: 6), while Hom and Griffeth (1995:


252)  quote American research indicating that 33% of women quit jobs to devote more time to their families a response given by only 1% of men. UK employers believe that 21% of their leavers resign ‘to have children or look after them’, a further 7% leaving to look after other family members (CIPD 2009: 31). Official statistics also show that average job tenure among women with children in the UK is over a year shorter than that of women without children and almost two years shorter than that of men. Taken together these statistics suggest that one of the more significant reasons for voluntary resignations from jobs is the inability to juggle the demands of a job with those of the family. They indicate that there is a good business case, particularly where staff retention is high on the agenda, for considering ways in which employment can be made more family friendly. Research into the antecedents of employee engagement also strongly suggests that the ability of people successfully to combine work and home responsibilities is one of the most significant factors in explaining high levels of engagement (Peccei 2013: 3469).


As a result of legislation, UK employers, like those in many countries, are now obliged by law to provide their employees with a range of family-friendly rights. Many, however, have decided to go a good deal further down this road than is required by law. The most common example is the provision of more paid maternity leave and the right, where possible, for mothers to return to work on a part-time or job-share basis if they so wish. Crèche provision is common in larger workplaces, while others offer childcare vouchers instead. Career breaks are offered by many public sector employers, allowing people to take a few months off without pay and subsequently to return to a similar job with the same organisation. Flexitime systems are also useful 

to people with families and there is also growing interest in ‘eldercare’ arrangements aimed specifically at providing assistance to those seeking to combine work with responsibility for the care of elderly relatives.

 Training and development

 There are two widely expressed, but wholly opposed, perspectives on the link between training interventions and employee turnover. On the one hand, there is the argument that training opportunities enhance commitment to an employer on the part of individual employees, making them less likely to leave voluntarily than they would if no training were offered. On the other, the alternative view holds that training makes people more employable and hence more likely to leave in order to develop their careers elsewhere. The view is thus put that money spent on training is money wasted because it ultimately benefits other employers.

 Green et al. (2000: 26772) report research on perceptions of 1,539 employees on different kinds of training. The authors found that the overall effect is neutral, 19% of employees saying that training was ‘more likely to make them actively look for another job’ and 18% saying it was less likely to do so. However, they also found the type of training and the source of sponsorship to be a significant variable. Training which is paid for by the employer is a good deal less likely to raise job mobility than that paid for by the employee or the government. Firm-specific training is also shown in the study to be associated with lower turnover than training which leads to the acquisition of transferable skills. The point is made, however, that whatever the form of training, an employer can develop a workforce which is both ‘capable and committed’ by combining training interventions with other forms of retention initiative.

 The evidence linking training and career development opportunities to employee engagement is much less unambiguous. Meta-analyses investigating the antecedents of relatively high levels of employee engagement place ‘opportunities for development’ close to the top of the list of factors that have a positive influence (Peccei 2013: 348). This is unsurprising because, in financing courses and training events, employers are sending a very clear signal to the employees concerned that their contribution is valued sufficiently for money to be invested in their personal development and potential career advancement.

 Improving the quality of line management

 If it is the case that many, if not most, voluntary resignations are explained by dissatisfaction on the part of employees with their supervisors, it follows that the most effective means of reducing staff turnover in organisations is to improve the performance of line managers. Investing in improving the quality of line management can also be shown to improve the chances that staff will be more engaged with their work, ‘leadermember exchange’ being a significant factor in determining how engaged any individual employee is likely to be (Peccei 2013: 348).


Too often, it appears, people are promoted into supervisory positions without adequate experience or training. Organisations seem to assume that their managers are capable supervisors, without recognising that the role is difficult and does not usually come naturally to people. Hence it is common to find managers who are





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 Once you have read the article, if you have understood the reading, you should be able to answer the following questions competently.

 A model answer is available for each question, but try to answer on your own first. Your responses won’t match the model answers exactly, but you should compare your performance with the models and consider whether you took all the relevant factors into account. Rate your performance honestly. If you haven’t performed as well as you hoped, you may need to go over parts of the chapter again.



 We recommend that you now complete your topic progress log. This should allow you to monitor and assess your progress and your understanding of the topic before you move on.






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