By Meg Beasley
Reporter
Federal News Radio

Agencies spend significant time and resources recruiting and training top talent but a new study warns that many are ignoring the other crucial side of the equation – keeping those employees. Retention strategies may become even more important in the face of looming pay freezes and budget cuts.

Ron Sanders, a Senior Executive Advisor for Booz Allen Hamilton and former Chief Human Capital Officer at the Office of the Director of National intelligence, told Federal News Radio, “your key employees are always at an attrition risk. The best and brightest can vote with their feet and we need to pay attention to that. And in this particular day and age, when we’ve got things like hiring and pay freezes, every vacancy becomes problematic. Managers may not be able to backfill.”

A new report titled Keeping Talent: Strategies for Retaining Valued Federal Employees by Booz Allen and the Partnership for Public Service offers guidance and recommendations for agencies to help them maintain their workforces and improve their professional atmospheres. The study looked at what factors cause employees to stay with agencies, the retention techniques and tools human resource departments and line managers currently use and which they think are most effective.

This report, said Sanders, is the second of a two-parter. Last December, the previous report focused on attrition, while this one concentrates on retention. “Contrary to conventional wisdom,” said Sanders, “the reasons people leave are not necessarily the same reasons that people stay.”

This study shows most agencies pay little attention to retention because the attrition rate has been low in recent years. It reports the rate was 5.85 percent in fiscal 2009, a decline from 7.6 percent the year before. The private sector rate in 2008 was 9.2 percent.

However, beneath those rates, the report found attrition varies among agencies, within agencies and from position to position. In reality there are pockets where attrition is a serious problem. The study highlighted three categories of employees who represent attrition risks-those who are new to their agencies, those eligible to retire within the next one-to-five years, and those classified as having mission critical jobs.

Furthermore, the report warns that looming pay and hiring freezes could prompt more federal employees to seek other positions or retire early, magnifying the importance of looking at attrition trends now.

The study’s authors say retention is an indicator of the health of an agency.

“Retention of newly hired, top-notch employees means that recruiting and hiring investments are paying off and new skills and energy are flowing into the workplace,” the study found. “Retention of high quality, mid-level and senior-level employees means an agency is benefitting from the judgment and experience of seasoned professionals… But high turnover rates may suggest problems in the workplace that need to be addressed.”

Researchers conducted focus groups and surveyed representatives from more than 20 agencies to gather their views and to understand the retention challenges faced by line managers and HR professionals in the day-to-day operating environment.

In general, agencies are currently using three retention techniques on which the Office of Personnel Management provides guidance: retention bonuses, flexible workplaces and work schedules and student loan repayment programs.

Responses showed tension and disconnect between line managers and agency/HR leaders when it comes to retention priorities. The report found that many managers do not feel well supported by their HR teams in dealing with individual retention issues. On the other hand, HR departments largely reported being effective in dealing with retention.

According to the study, line mangers typically take a tactical view-focusing on how to retain their individual, valued team members. They use specific techniques and tools, such as retention bonuses and training opportunities to do so.

Agency and HR leaders, in contrast, take a broader view, favoring work/life balance policies such as flexible scheduling to create a good work environment. The report recommends that leaders focus on balancing the concerns of line managers with their focus on agency-wide goals.

In his experience, said Sanders, intangibles are the most important factors in deciding to stay. “If the employee has a connection to the agency mission, if they have a connection to his or her co-workers, if there’s a great relationship with the boss – those kinds of intangibles trump whatever else may be going on in the agency or in government at large; things like pay freezes and hiring freezes.”

Both line managers and HR leaders agreed on the importance of improving their organization’s image and becoming an employer of choice. The study suggested this shared goal may provide an incentive for all parties to come together to develop creative ways to address organizational problems that contribute to attrition, paving the way for improved retention.

The report divided the work environment into four quadrants that determine employee satisfaction and recommends strategies to improve retention in each of these areas.

• Teamwork, supervision and leadership: According to the report, this is the most difficult area to address but also the most important. One manager surveyed said, “People don’t leave jobs, they leave their managers. I believe people would rather work for the best manager at the worst company rather than the worst manager at the best company.”
  • Use periodic surveys or questionnaires to gain insight into the way different employee groups feel about agency operations and leadership effectiveness.
  • Conduct “stay” interviews with employees and actively using the results.
  • Require training for managers in supervisory skills and in managing employees for teleworking, flexible work arrangements and generational differences.
  • Provide coaching, training and other kinds of support to help problematic managers change and to hold them accountable for improvement.

• Agency mission and employee skills match: An agency’s mission can be one of its most powerful recruiting and retention tools. Dedication to making a difference is an important driver for many people interested in working for the government.
  • Strengthen the assessment process for evaluating and selecting new employees.
  • Implement realistic job previews.
  • Strengthen the line of sight between agency mission/objectives and employees.
  • Build agency reputation as the place to work or as a center of excellence for a discipline or field.
  • Use technology, such as internal social networks, to encourage cross-agency networking and communication about mission-related projects.

• Employee development and support: Researchers found growth opportunities, a fair and unbiased workplace and a welcoming environment to be important factors in retention.
  • Implement and supporting a strong onboarding program to prepare, socialize and help new employees adjust.
  • Establish mentoring programs by pairing more experienced with less experienced employees.
  • Encourage employee affinity groups to support and sustain workplace diversity.
  • Emphasize individual development plans to encourage and support employee growth.
  • Offer leadership training for selected individuals who meet criteria as potential future leaders, as well as for senior leaders and executives.
  • Operate a robust internship program providing a pre-employment opportunity for potential new hires to experience the organization.

• Performance management, compensation, benefits and work/life: The study found this category to be especially important for younger employees who expect more defined and faster career paths.
  • Offer retention bonuses
  • Offer flexible workplaces and flexible work schedules as part of improving work/life balance.
  • Improve the performance management process by strengthening performance appraisals, recognizing accomplishments and providing meaningful feedback.
  • Use phased-retirement and re-employed annuitant programs that enable agencies to bring back former employees with needed skills for specific projects and also to support knowledge transfer.
  • Supplement pay.
  • Provide employee and family-friendly benefits.

The study warned that attrition hurts agencies in a number of ways – the loss of expertise, demoralization to the remaining employees and a burden on line supervisors who have to reorganize the workforce. Equitable private sector data shows the loss and replacement of employees has a financial cost of anywhere from 50 – 200 percent of salary depending on the position

“As part of this process, agencies need to be prepared to deal with emerging issues, such as pay and hiring freezes or the shift to the more portable Federal Employees’ Retirement System (FERS) retirement programs with provisions that allow certain employees, such as law enforcement personnel, to retire after twenty years,” the report stated. “In general, employees want to be recognized for their work, use their talents, have an impact, feel empowered, receive support and have opportunities for growth. They want to have good relationships with their supervisors and colleagues, as well as a sense of teamwork and shared mission. They also want a family-friendly environment, and they want to receive fair compensation and recognition for their performance.”

Sanders said there’s no panic. “The sky’s not falling. The report’s not intended to suggest that, but it is intended, I think, to raise the level of awareness here, because…it’s easy to get lulled to sleep. Attrition rates are low, unemployment is high, there’s really no danger that employees are going to leave in en masse.” Sanders said he worries more about competing in a war for talent.

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