Attracting IT Talent: The Human Factor - ' Why Keeping Top Talent '

Why is retaining employees so difficult for American companies? The reasons, experts say, are many. First of all, the historical relationship between company and employer, in which corporations offered what amounted to lifetime employment in return for a high degree of loyalty on the part of employees, has essentially broken down in the face of the financial reengineering and downsizing of the 1980s and early 1990s. Closing pension funds and mass layoffs have resulted in employees who are deeply distrustful of their employers.

Says Robert Morison, an executive vice president and director of research at the Kingwood, Texas-based Concours Group and a co-author of Workforce Crisis: How to Beat the Coming Shortage of Skills and Labor (Harvard Business School Press, 2006): "Young employees are even more inclined than their parents are to job hop. They've seen what corporations have done to their parents, and they assume no loyalty, because corporations haven't shown them any.

"We call this the evolution of the employment deal, which involves putting more and more burdens on the employee—for healthcare premiums, pension contributions—with fewer guarantees. These components of the deal have become less important—they're essentially the same from one company to the next—and other parts of the deal become more important: How congenial is my workplace? Do I have a chance to learn things on the job? How exciting is my work?"

Not very exciting, apparently, and that's another problem. In 2004, Concours, together with the Harris Group, surveyed almost 8,000 corporate employees on their attitudes toward work and life, and the results were not encouraging. A third of respondents said they were in dead-end jobs, while 42 percent said they felt burned out in their jobs. Just 28 percent said their work made them feel energized.

Says Morison: "Feeling dead-ended is the variable that correlates most closely with low engagement scores. There's an enormous amount of energy and capability pent up in the American workforce. If we could make jobs more interesting, give people more opportunity to move around the company, to grow on the job, the result would be extra discretionary effort."

So corporate America has a great deal of work in store to stem the restlessness of U.S. workers and repair the pact between employers and employee. But to do so, as Morison points out, companies can't simply offer more money and benefits; workers don't see benefits as a differentiator among prospective employers and companies remain reluctant to throw money at the problem of retention. Instead, companies need a carefully thought-out workforce strategy that specifically links the makeup of their present and future workforces to the company's business strategy and goals. And IT can help.

Next page: IBM's Survival Strategy for Talent Retention

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