Employee Loyalty Has Dropped Worldwide

October 27, 2011 (PLANSPONSOR.com) - Employee loyalty is dropping around the world, according to a new global analysis of Mercer’s What’s Working survey.

The research shows the percentage of workers seriously considering leaving their organization has risen since the last time the survey was conducted in each market (between 2003 and 2006 prior to the economic downturn). In many markets, the increase is 10 percentage points or more. In the U.S., the increase was 9 points, from 23% in 2005 to 32% in 2010.  

According to a news release, the global analysis also reveals that nonfinancial factors play a prominent role in influencing employee motivation and engagement – a finding that could prove useful to employers facing budget constraints. Workers worldwide say that being treated with respect is the most important factor, followed by work/life balance, type of work, quality of co-workers, and quality of leadership.  

Among financial factors, base pay ranks highest globally, at sixth out of 13 factors. It ranks as the top factor in just one market (Hong Kong) and among the top three most influential factors in four other markets – China, India, Italy, and Singapore.  

While other financial factors, such as benefits and incentive pay, can be important to other aspects of the employment deal – such as attracting, retaining, and rewarding employees – Mercer’s research shows they are considered less important by employees when it comes to their day-to-day motivation and engagement at work. 

Mercer’s What’s Working survey shows that the factors most important to motivation and engagement vary by region: 

  • Americas – In addition to the global top five nonfinancial factors – respect, work/life balance, type of work, quality of co-workers, and quality of leadership – working in an environment where employees can provide good service to others ranks highly in importance in North and South America. Base pay ranks as the most influential financial factor.  
  • In the U.S., the importance of financial and nonfinancial factors closely mirrored the global findings. Two areas of note that scored higher than the global average were benefits and working in an environment where you can provide good service to others. Areas below the global average for U.S. employees included learning and development opportunities, promotion opportunities, and incentive pay/bonus. 
  • Asia Pacific – Results for this region are less consistent by market compared to the Americas and Europe. Being treated with respect and quality of leadership are cited by employees as most influential to their motivation and engagement at work. Australia shows the widest variation in influence of factors, while financial factors (base pay, incentive pay and benefits) and career-related factors are much more influential in China compared to other markets in the region and globally. 
  • Europe – Results for the seven European countries included in Mercer’s survey show striking consistency. Nonfinancial factors (being treated with respect, work/life balance, type of work and quality of co-workers) are considered most important to employee motivation and engagement at work.  
The research was conducted among nearly 30,000 employees in 17 geographic markets between the fourth quarter of 2010 and the second quarter of 2011. Visit http://inside-employees-mind.mercer.com/global for an interactive look at additional global findings from Mercer’s What’s Working survey.