Given the staggering job losses and unemployment the pandemic has wrought, you would think that most people are holding on tightly to their jobs. Not quite.
In fact, there is a higher-than-normal rate of resignation in 2021 compared to past years, especially among mid-career professionals and managers.
This shift is worth noting in the midst of Malaysia’s gradual reopening to business, after going through several forms of Movement Control Orders (MCO) from March 2020. The curbs resulted in 155,893 job losses during the COVID-19 outbreak, according to government figures shared by the country’s Human Resources Minister Saravanan Murugan.
As such, it is surprising that a sizeable number of employers (25%) in Malaysia reported higher than usual voluntary departures of mid-career professionals and managers, according to Mercer’s latest labour market survey.
The survey, which reflected similar experiences among companies in the region, was conducted in July and August 2021 with 266 employer respondents in Asia-Pacific, including 44 in Malaysia.
1. Employees are unhappy with the status quo. More than half the companies (57%) reported that insufficient salary was a primary driver of voluntary turnovers, with employees saying they could get better wages and benefits elsewhere. A significant number (41%) cited employees’ concerns about limited career advancement. The same was true among Asia-Pacific respondents.
2. Mid-career professionals are highly sought-after. A limited supply of talent and a wider range of jobs for professionals are resulting in resignations and complicating new hires. This has put employers in a spot: They find it tougher to retain mid-career professionals who are emboldened to quit their jobs during a crisis, while not being able to easily hire this same group of employees due to a mismatch in skills, aptitudes and wage expectations.
3. What employees want: A great place to work in. A company’s culture as well as its corporate image and branding are crucial to retaining and recruiting workers. Most employers believe they can keep their talents with a good company culture (80%), and reskilling or upskilling opportunities (73%), which are as important as offering job security and a competitive benefits package.
The pandemic’s effect on the job market is prompting companies to review their workforce strategies, especially with intensifying pressures to retain mid-career professionals who are in demand.
As Godelieve van Dooren, Mercer’s CEO for the South East Asia Growth Markets, put it: “The pandemic has accelerated the need for employers to reassess their ability to retain talent in the face of a tight labour market and skills shortages. Rather than just focus on what’s driving attrition, employers should consider what will make their employees stay.”
While compensation packages are often the go-to move to retain and attract employees, a strategy relying solely on financial incentives is not sustainable. Mercer’s Total Remuneration Survey and Pay Band Tool 2.0 will be able to offer insights with regards to compensation and aid your workforce policy planning needs.
Employers can also do better by taking action in areas such as enhancing workplace flexibility and providing more opportunities for their staff to expand their skills portfolio.
In light of COVID-19’s impact on the workplace, our survey showed that 40% of the respondents intend to move to flexible schedules, in which all or most employees can choose to work remotely or on-site. This is a good start, along with measures that include providing more well-being and mental health support.
A new hiring trend is also emerging: with remote work now the norm, companies can now widen their talent pool and hire people living in different cities or countries. What is notable is that more than half (53%) of companies surveyed intend to evaluate their talent management and sourcing strategies, such as offering remote-first jobs.
As the economy opens up in line with the Malaysian government’s National Recovery Plan schedule to lift movement restrictions and reopen business sectors, employers will have to brace for more changes – and perhaps even more resignations.
In a year like no other, how companies support and engage employees will also have to change. Forward-thinking employers should start preparing a comprehensive strategy to retain and recruit the talent they require for long-term business success.
Contact Mercer to find out how we can help you design a holistic employee value proposition.