Improving business climate sees return of attraction and retention as key focus for HR in 2006

Staff retention and talent management will be the top HR issues facing UK businesses in 2006, according to leading HR consultancy RightCoutts.

New research conducted by RightCoutts reveals that 41 per cent of senior HR professionals cite the retention of key staff as their organisation’s most critical HR issue this year. Recruiting enough talented individuals is also a hot topic, with 39 per cent of respondents making this issue a high priority, signifying that the skills shortage shows no sign of diminishing.

Surprisingly, at a mere 12 per cent, employee engagement is 29 percentage points lower than the top HR issue of retention. The connection between increased levels of employee engagement and improved staff retention (plus lower rates of absence) are well documented. In addition, studies have shown that highly engaged workforces are better at attracting jobseekers, as success breeds success. That this issue attracts so little attention even from HR professionals is alarming.

Edna Agbarha, head of talent management at RightCoutts, comments: Strategies to maintain and develop employee engagement are currently not receiving enough attention and as a result this is having a knock on effect on the attraction and retention of key talent. Businesses need to address this issue sooner rather than later in order to avoid storing up trouble for the future.

The research also indicates that despite new HSE guidelines requiring employers to take a certain amount of responsibility for staff wellbeing, many businesses are still not effectively tackling stress in the workplace. Only a third of those surveyed (32 per cent) believe their organisation is effective at managing workplace stress, which suggests that many organisations still have a way to go before policies are fully implemented and understood.

Another worrying aspect to emerge from the survey is the revelation that many businesses are not making the most of their employees’ potential. Thirty-two per cent of respondents feel that managers in their organisation do not develop people effectively. However, HR departments do have faith in top executives with almost three-quarters of respondents (71 per cent) stating that senior leaders have the capability to make their organisation successful.

Edna Agbarha cautions: Although many companies are now starting to recognise that the HR function has an important role to play in influencing board level decisions, there is still a long way to go. Only when HR expresses its concerns in terms that the business relates to - enhanced productivity and customer service, better leadership and faster decision making - will they see the necessary emphasis on talent management and employee wellbeing from line managers and senior executives.