Employers have been warned that a period of “stripping the fat” is taking its toll on employees, who rate lifestyle factors as more important than salary. But how does this compare to Australia’s official productivity rates?
Global research and advisory firm Gartner released its quarterly Global Talent Monitor, based on the responses of 40,000 employees in 40 countries. The March quarter included 1,909 respondents in Australia.
It found that Australian workers are slightly less inclined to stay with their current employer than the international average (30.3 per cent of Australians said they had a high intent to stay, compared with an international average of 32.8 per cent).
And unlike their international counterparts, Australians did not rate compensation as a chief motivator for either attraction or retention with an employer.
In terms of attrition, global workers rated compensation as their chief concern, followed by work/life balance and stability.
Yet locally, compensation did not make the top three. Instead, respect was deemed the most important factor for Australian employees, ahead of manager quality and work/life balance.
It was a similar tale in terms of attraction to a new employer: compensation followed by future career opportunities and people management were the top three motivators for global workers. Yet in Australia, work/life balance was the key motivator to change jobs, followed by location and respect.
Gartner also measured “discretionary effort levels”, or the willingness employees have to go above and beyond in their job. It found that while 15.7 per cent of Australian workers with high discretionary effort levels pipped the international average (15.0 per cent), this rate had fallen since a high of 23 per cent was recorded in the June quarter of 2017.
Aaron McEwan, HR advisory leader at Gartner, said the results show that employees are feeling the pinch from doing “more with less”.
“Organisations have stripped the fat in every area of operations as they look to drive efficiencies and move their business into the future,” Mr McEwan said.
“Growth targets are high, and for years, organisations have expected their workers to do more with less and achieve continuous results against a backdrop of constant change and increasing complexity.”
He continued: “Workers are acutely aware of what their employers want from them; they’re feeling pressure to work longer hours, often without pay, and take work home in order to meet deadlines. With the added stress of ‘always on’ technology and flat wage growth, it’s not surprising that employees are feeling overworked, disrespected, stressed and anxious.”
According to the data, intent to stay among Australian employees fell by 8 per cent, while those actively job-hunting increased by 5.6 per cent.
“To see these indicators of dissatisfaction and disengagement so early in the year is alarming and should be a wake-up call to employers,” Mr McEwan said.
“There’s a long year ahead and growth targets are not going away. We need a workforce that is energised, committed and focused on delivering results.”
Are Australians really ‘doing more with less’?
Gartner’s report was released just a week after Australia’s Productivity Commission released its latest official report on the nation’s productivity.
It described productivity in Australia last financial year (2017–18) as “sluggish”, rising by just 0.2 of a percentage point for the year across the whole economy.
Across the 16 key industry market sectors it analysed, the commission put labour productivity at 0.4 of a percentage point and multifactor productivity at 0.5 of a percentage point.
“Labour productivity growth is well below the market sector’s long-run trend rate of 2.2 per cent per year from 1974–75 to 2017–18,” it said in its May 2019 Productivity Bulletin.
“This continues the recent trend of weakening productivity growth since the end of the investment phase of the mining boom in 2012–13.”
According to the Productivity Commission, this below-average productivity is at least partially being driven by “a marked slowdown in investment in capital” on the part of employers.
“This is troubling because investment typically embodies new technologies, which complement people’s skill development and innovation,” the report said.
“This is especially so for investment in research and development, where capital stocks are now falling.”
Nevertheless, it noted that Australian productivity remains ahead of many other countries, allowing living standards to remain comparatively high.
The commission also said that overall productive capacity within the Australian economy has risen, thanks to an increase in “labour supply”, or people participating in the workforce, to the point that “output per capita has exceeded output per hour in recent years”.
The full report can be found on the Productivity Commission’s website.
Wages remain key concern for economy
Despite Gartner’s data suggesting Australian employees rank financial compensation lower than lifestyle factors, wages had been a key point of debate in the recent federal election.
The federal opposition had proposed intervening in the Fair Work Commission’s recent determination on the minimum wage, stating it would advocate for a more considerable rise to what it called a “living wage”.
Employers — including many My Business readers — had baulked at the proposal, with a number stating it would not address cost of living pressures because businesses would have to raise prices in order to accommodate a substantially higher wage bill.
Regardless, wages remain a key concern for Australia’s economy: figures from the ABS earlier this month showed company profits increasing at almost twice the rate of wages, and the Reserve Bank cut official interest rates on the back of concerns about unemployment and low wage growth.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.