One in five employees quit within the first two years

2006

The phenomenon of "job shock" has been brought into sharp focus as a new survey reveals that twice as many employees quit their job within the first two years of starting it as do those with more than two years of tenure.

A study of worker attrition rates by research firm Sirota Survey Intelligence has found that employees with less than two years of service voluntarily leave at an average rate of about 20 per cent per year, while those with more than two years tenure quit at an average rate of only half this.

What's more, the survey of almost 47,000 employees found that almost six out of 10 of all those who quit in any given year have been in their job for less than two years.

"Many leaders fail to recognise that new employees are enthusiastic about staring a job and that by their actions, management destroys this enthusiasm," said Douglas Klein, president of Sirota Survey Intelligence.

"Our research shows a measurable decline in employees' morale after they have been working for an organisation for six months, and this deterioration worsens as they continue to evaluate what they expected against what they are receiving.

"Best-in-class companies do not create this decline in morale as seen in the overall trend," he added.

The findings echo a survey of over 80,000 British employees carried out last year by employee engagement specialists, Best Companies Ltd, which found that many staff start to feel disenchanted after just a year into a new job.

According to David Sirota, chairman emeritus of Sirota Survey Intelligence, this 'honeymoon effect' is all about unmet expectations.

"During the first two years on the job, employees are confirming that their actual jobs meet their expectations, as well as those that their employers led them to believe during the recruitment process," Sirota said.

"Since management's attitudes and behaviours can enhance employee retention, companies should invest in improving managers' leadership skills and creating an environment where employees feel genuinely valued by their employers."

According to analyses based on the study, companies can improve the retention of newer employees by 10 per cent to 13 per cent by adopting more effective management policies and practices.

These include making work more challenging, being clear about potential career paths and providing greater opportunities for development.

But critically, employers need to create an atmosphere where staff feel valued and secure - recognising them for good performance and listening to their ideas, then acting on them.

Managers also need to change their behaviour and become more consistent in what they say and do.

"Companies can save considerable sums of money by improving the retention of newer employees," Sirota said.

"It is commonly estimated that it costs more than one and a half times the salary of a departing employee to replace him or her when factoring in recruitment and training costs and lost productivity."