CIPD: Don’t become complacent in talent battle
Ensuring benefits packages are engaging and motivating has become a greater concern for reward professionals than attracting and retaining staff.
That was a key finding in the latest reward risk survey from the Chartered Institute of Personnel and Development, which reveals that attraction and retention of key employees has fallen out of the top ten list of concerns for the first time since the survey began in 2010, while increasing pensions costs has crept in to the top ten for the first time.
The top concern remains, for the second year running, that employees don't appreciate the value of the total reward offering. Meanwhile, employee attraction and retention have moved from 1st and 6th places in 2010 and 9th and 10th places in 2011, to 11th and 12th in 2012.
Other reward risks that have moved up the table of concerns in the past year include:
• Employees don't understand performance and behaviour requirements (moved from sixth place to fourth place)
• Incentives not motivating (moved from eight place to fifth place)
• Inability to communicate desired performance and behaviours (moved from eleventh place to seventh)
• Increasing pensions costs (moved from thirteenth place to tenth place).
Charles Cotton, rewards adviser at the CIPD, said: "It's encouraging to see reward professionals thinking more strategically about rewarding the behaviours and performances that contribute to business success, but attracting and retaining key talent is always crucial - in the good times and the bad. Even in a stagnant labour market, key talent can find opportunities to move onward, so reward professionals shouldn't be too complacent while they wait for the economy to eventually pick up.
"With automatic pension enrolment kicking off in the UK, it is not surprising that pensions cost has become a top ten risk that needs to be managed nor that it is predicted to be the second highest reward risk in the next couple of years. What is surprising, however, is that the underperformance of pension funds is still not regarded as a major risk for many of our respondents.
"Even defined contribution plan sponsors should review the performance of the funds, especially their defaults, if they and their employees are going to derive a good outcome from this workplace benefit."