A Recruitment And Retention Management Essay
Employee turnover is when employees leave an organization voluntarily or involuntarily. The high cost of employee turnover is one reason why recruitment and retention is important. Experts estimate the average cost of turnover to be equivalent to one year’s salary. There are some common costs associated with having to replace employees. Tangible costs of recruiting new employees include advertising, screening, interviewing, orientation and training, new employee setup, and travel. “It was estimated in a study by Abbasi & Hollman in 2000 that American industries incurred $11 billion annually as a result of voluntary and involuntary turnover. This cost was due to termination, advertising, recruitment, selection and hiring” (Rehman, 2012, p.79). Recruitment is the process organizations use to find and hire qualified workers. Retention refers to the efforts by an organization to keep employees.
Involuntary turnover refers to job separations initiated by the organization such as firings or layoffs. Voluntary turnover refers to turnover initiated by the employee. Efforts to reduce turnover can begin before employees enter the organization in the recruitment and personnel selection stages. In the recruitment stage, a useful tool for reducing turnover is the realistic job preview (RJP). Realistic job previews are comprehensive profiles of both positive and negative features of a job presented by the organization to prospective or new employees. “A great deal of research has been conducted on the effectiveness of RJPs, which appear to lead to somewhat higher job satisfaction and lower turnover. This appears to be true because providing applicants with realistic expectations about future job characteristics help them better cope with job demands once they are hired. RJPs also appear to foster the belief in employees that their employer is concerned about them and honest with them, which leads to higher levels of organizational commitment” (Heneman & Judge, 2010, p. 238).
It is important that organizations know why employees leave the organizations. One of the most utilized processes to uncover the causes of turnover is the exit interview. The exit interview is taken just before or after an employee leaves the organization. Exit interviews can be face-to-face interviews, a questionnaire, or a brief survey. An anonymous questionnaire, administered confidentially, can usually get the best results for the cost. Exit interviews can provide excellent data to develop retention issues when properly designed and implemented. Exiting employees may be the best source of data to determine why employees are leaving.
Effective management of an organization’s human resources is a major source of competitive advantage and may be the single most important determinant of an organization’s performance long-term. The organization environment is very fluid and has changed over the years. These changes have had a significant impact on organizational efforts to be successful. Organizations are realizing the likelihood of sustained success is most dependent on learning to get the maximum out of their employees. Organizations have started to figure out that their success is dependent on being able to attract and retain talented employees. An important element of any organization’s success is a strategy where every employee is treated as a valuable resource.
An evolving world changed the competitive climate for organizations and forced them to consider the role of employees in their ability to achieve success. Many factors including technology changes, demographic factors, increasing ethnic diversity, and funds availability have an impact on the workforce and are prominent forces that can’t be ignored. Organizations must learn to be responsive to relevant issues and challenges. Employers across the country struggle with many similar recruitment challenges. Some of the challenges include recruiting and retaining qualified employees, dealing with a more diverse workforce, and coping with demographic changes and economic stability.
Job positions that require some experience and expertise, such as management, technical, or professional positions, will be harder to fill with qualified employees. Despite the economy, it is critical that organizations continually work hard to attract and compete for top performers. “Top performers by the very nature of who they are and the skill set they possess are those employees who want to be allowed to use their expertise on the job and then be held accountable to their performance. Top performers have very high expectations for themselves and for the people with whom and for whom they work” (Langan, 2000, p. 462).
Recruiting and staffing is more complex than it used to be when organizations could rely on recommendations from current employees or help wanted signs. The increased complexity of positions to be filled and equal employment opportunity require more sophisticated procedures to identify and select prospective employees. For instance, prior to antidiscrimination laws, organizations hired people based on a handshake or because they graduated from the same university. Such practices today would lead to charges of discrimination. To protect themselves, organizations must carefully determine needed job qualifications and choose selection methods that accurately measure those qualifications.
When an organization creates a new position or an existing one becomes vacant, it looks for people with qualifications that meet the requirements of the job. The two sources of job applicants are the internal and external labor markets. The internal labor market consists of employees currently employed by the organization. Internal recruitment can be greatly facilitated by using a human resource information system containing a skills inventory or computerized employee database of information about an employee’s previous work experience, education and certifications, performance, and attendance. Promotions and job transfer are the most common results of internal recruiting. This can lead to upward mobility for employees within the organization. The external labor market is the pool of potential applicants outside the organization. This consists of prospects to fill positions that cannot be filled from within the organization. Numerous methods are used to attract applicants, including employee referrals, rehires, newspaper ads, websites, in-house bulletin boards, employment agencies, and college placement offices.
The primary purpose of the recruitment and selection process is all about appointing the right person to the right job. This is an important venture for any organization, and even more difficult when there is a shortage of the needed skills and experience in the labor market. How to obtain the right person’s attention and interest is a challenge. When levels of unemployment are high, it is an employers’ market. However, when levels of unemployment are low, the employer can be faced with a very different task. Power then lies with the applicants, and the major challenge is selling the job and the employer. While a more educated workforce is desirable, educated workers usually demand a higher salary. This is further complicated by the laws of supply and demand. A shortage of qualified workers due to the age shift in the population will naturally drive up salaries. It is apparent in today’s job market where the average employee works for one organization for two to three years before changing jobs. Gone are the days where an employee works for the same company their entire career. Job hopping for a higher salary is very common and will become the norm rather than the exception.
Despite large candidate pools for entry-level workers, there is an ongoing search for talent. These labor shortages are driving organizations to hire employees away from other organizations, often using higher wages and signing bonuses as the primary lures to attract workers. Organizations must try to safeguard their workers from this action by proactively addressing retention issues.
Organizations should look beyond the skills for the specific job in hand, and to look at the potential range of matches for the person, such as future work and person-job fit within the organization. A good person-job fit is one in which the employee’s contributions match the incentives the organization offers. Each employee has a specific set of needs to be fulfilled and a set of job-related behaviors and abilities to contribute. If the organization can take perfect advantage of those behaviors and abilities and fulfills the employee’s needs, it will have achieved a perfect person-job fit.
The U.S. population is becoming more diverse, thus more applicants are minorities or women. “Data starting in the 1980s and projected through 2018 show a slow trend toward nearly equal labor force participation for men and women, a slight decrease in the proportion of whites in the workforce, and large proportional growth in the representation of Hispanics and Asians. There will also be a dramatic shift toward fewer younger workers and more workers over the age of 55” (Heneman & Judge, 2010, p. 91).
Federal, state, and local laws also generally require equality in employment. This means hiring people based on their abilities to do the job, not based on their ethnicity, age, gender, or other trait such as disability. Furthermore, having a diverse workforce is becoming a practical necessity as organizations do more and more business around the world.
Recruiting a diverse workforce requires accessing recruitment and retention efforts and paying attention to the diverse employees’ needs. For example, older workers sometimes value having more free time and flexible work hours. Some organizations work around the employee’s schedules. Recruiting single parents similarly requires understanding that they often need to have flexible work arrangements. Women workers, married or not, often carry the heavier burden of caring for the children. Some organizations, therefore make it easier for females to restart their careers after returning from lengthy maternity leaves or to remain employed in positions that don’t involve the time commitments of being full-time. In any case, recruiting and retaining a diverse workforce requires a plan for providing the employment support these employees need.
To be effective in the workforce, managers will have to understand the different cultures of their employees and client populations. Employees will be more diverse, and their cultural differences will show up in daily interactions. Diversity can bring in different perspectives, which can enrich the operations of organizations.
The ultimate goal of recruiting is to generate a pool of qualified applicants for new and existing jobs. One of the challenges is creating an applicant pool that is demographically representative of the population at large if the diversity is to be achieved. Recent research about the top five most frequently used search methods has revealed a major surprise about recruiting for diversity. Personal referrals turned out to be the best way to land a job. Word-of-mouth advertising is both effective and inexpensive. In addition, employee referrals lead to greater retention because they have already passed the first test of peer approval.
The employee selection process is important when hiring for diversity. Selection processes must be accurate and legal. “Two major, overarching principles pertain to selection. The first principle is that it is unlawful to screen out individuals with disabilities, unless the selection procedure is job related and consistent with business necessity. The second principle is that a selection procedure must accurately reflect the KSAOs being measured, and not impaired sensory, manual, or speaking skills, unless those impaired skills are the ones being measured by the procedure” (Heneman & Judge, 2010, p. 481).
Interviews tend to be the best method of employee selection. In many instances, particularly when candidates and recruiters are geographically dispersed, telephone and video-conferencing can substitute or complement face-to-face interviews. However, even in a technology environment, the human touch will still play a critical role in selection. The more structured the interview process, the more valid and reliable. Unstructured interviews are quick and not very well planned.
Demographic changes have made recruitment and retention especially difficult. The workforce overall is maturing with the average age of employees rising from 35 to 55. The economy has been growing overall more than the workforce. “According to a 2000 Bureau of Labor Statistics report, by 2015 there could be as many as 21 to 40 million more jobs than there are employees in the United States. The forecast of labor shortages is based on the assumption that current retirement trends will continue as the large baby boom generation begins to exit from the labor force” (Jamrog, 2004, p. 27). The ramifications are a pronounced shortage of skilled workers and escalating competition among organizations to recruit and retain those who are available. Emphasis must be placed on recruiting and training efforts to fill positions left open by retiring employees.
One strategy for competing for valuable employees is to retain existing employees. To keep older workers in the workplace longer or to bring some of them back into corporate America, corporations would need to rebuild their reputations as ethical and trustworthy organizations. Programs to retain older workers should also make these organizations attractive to younger workers. Workplace strategies that are important to both pools of labor include flexible work structures, training and retraining programs, diversity programs, and portable benefits.
Another strategy to recruit and retain employees is providing various employment arrangements. Employees may be full-time or part-time. 83% of people work full time and 17% work part time. “A second arrangement involves the issue of flexible scheduling and shift work. The proportion of the workforce covered by flexible shifts has steadily grown from 12.4% in 1985 to 27.5% in 2004. Work hours are often put into shifts, and about 15% of full-time employed adults work evening, night, or rotating shifts” (Heneman & Judge, 2010, p. 93).
Economic conditions can negatively affect recruitment. Under conditions of economic growth, there is a scarcity of qualified applicants. Agencies are likely to conduct open and continuous recruitment for a range of positions in response to high demand for vacancies that must be filled through internal promotion or external recruitment. During periods of economic instability, an air of uncertainty and concern may occur causing organizations to hesitate with staffing efforts. Jobs could ultimately remain vacant, employees could become overworked and unmotivated, and productivity and quality of services could decline.
Forward-thinking employers understand that regularly identifying key performers and ensuring that they are being fully utilized and motivated is a valuable precursor to recruitment. After experiencing economic setbacks, many employers leave openings unfilled, relying instead on their best workers to perform additional duties. This may work temporarily, but it is likely to ultimately strain employer-employee relations to the point where top performers transfer to other job opportunities. Recruiting during an economic downturn can actually serve as a competitive advantage with the use of targeted recruitment. For example, an organization that requests to fill technical support positions would focus on industry-specific sources. Targeted recruitment also supports efforts to increase workplace diversity by using sources that reach out to underutilized groups. Targeted recruitment assists organizations with their affirmative action goals.
“Nothing will improve an organization’s ability to attract and retain employees better than offering higher salaries and more benefits than its competitors. Studies show, however, that providing a better work environment can also be an extremely effective tool for attraction and retention” (Earle, 2003, p.248). Employee retention not only ensures the continuous availability of the required manpower but it also reduces the cost that is associated with recruitment, selection, placement, induction and training.
Employee retention is a critical issue that needs to be handled with precision so as to avoid adverse effects of employee attrition on the organization. Organizations need to examine how well they are retaining and recruiting new employees. Each organization should evaluate employment policies such as work schedules, retirement, and hiring new employees. People are the most important resource for most organizations. Therefore, in order for employers to be competitive in a tighter labor market, employment and retirement policies will need to be revisited and revised. Organizations that fail to address these crucial issues will likely find themselves unable to compete successfully in the decades to come.Order Now