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PrintSeptember 24, 2013
Why should they care?
Employees and associates are becoming less engaged in the workplace and that disenchantment is greatest among the top performers.
On the surface of it, it would be very easy to say "this young generation just doesn't understand how lucky they have it.' The familiar lament by those of us who are older about those who are younger has been going on for a millennium.
This time, though, it is different.
This is an historic time for us all.
Perhaps for the first time in history, we will have the opportunity to save an economy in decline by reversing foolhardy employment practices. If no action is taken to rectify flawed policies, the impact on the economy and our future will be severe.
Either we will restore the American dream or we will abandon it forever by the decisions we make.
Since our nation was founded, American workers cherished the thought of making a better place for themselves and for their children. Work hard, save, study, be loyal to your employer, and the rewards are yours.
Defined-benefit pension plans were given for faithful and loyal service. Concurrently, employees were held accountable for performance. While the system was not perfect, employees and employers saw a better day and a bright future for most Americans.
Higher education was reasonably priced for the period and within the reach of most Americans who had the drive and the determination to work hard, study, and succeed.
In the 1970's and before, most believed that Social Security was going to be there for you and any "fixes" would be minor.
What has happened in the past 30 years has been mind-numbing. The American dream is becoming a distant memory of another era.
Many of the major issues adversely affecting younger people are reversible. Those issues must be addressed today to avoid catastrophic economic failure with profound implications in the workplace.
For instance, the decline of the defined-benefit pension plan is problematic because it removes the incentive for an employee to remain with one employer. All that has happened when such plans ended was that the risk of retirement planning shifted to the employee from the employer.
The need did not go away. The planning for retirement merely shifted. Remaining with one company for a career suddenly became significantly less attractive.
Today's college graduate owes $26,000 in student debt. The implication to the employer of such massive student debt seems obtuse but when combined with reduced pay raises since 2008 and lower starting salaries, employees are encouraged to move from one job to another searching merely for higher income in order to pay off their student debt. Real wages for employees continue to be relatively stagnant.
Social Security's insolvency is also well-documented. Even the trustees of the Social Security funds confirm that current benefits cannot be sustained beyond 2036. The Medicare trust funds are already insolvent. As such, most young employees do not see Social Security as a viable source of retirement planning yet they have the "pleasure" of paying into the system without the likelihood of seeing the benefits that they have been promised.
Performance appraisals in the workplace are also a disaster. Substandard performers are being handled with kid gloves while superior performers are seeing an increasing workload to cover for those who are not performing. The result of this failing with rewarding top performers is that it encourages top performers to leave.
Employee engagement surveys confirm that the decline in worker engagement is greatest among the top performers. When top performers become disenchanted, they have the ability and willingness to leave their employers. The employer is then left with either substandard employees or those who are not able to move for personal reasons.
Unemployment numbers are deceiving at best. While the economy appears to be limping along, demand for top talent is increasing consistently. Unemployment and underemployment is predominately an issue for the less capable.
The bottom line of all these issues is that corporations are losing their top employees. The best employees are choosing work life balance over careers.
Every conceivable message that our government and employers have sent to employees, particularly the best and brightest, is that we do not want you, we do not care about you, and we do not care if you leave.
When these top performers do leave we have the audacity to question their loyalty. Are you kidding me?
Flawed human resource policies are undermining the future workplace and the American Dream by failing to deal with the very real and substantive issues causing the decline in employee engagement.
If you want great performance, reward it. Despite what you see in schools, once one enters the workforce not everyone gets a trophy.
Col. Frank Ryan, CPA, USMCR (Ret) and served in Iraq and briefly in Afghanistan and specializes in corporate restructuring and lectures on ethics for the state CPA societies. He has served on numerous boards of publicly traded and non-profit organizations. He can be reached at FRYAN1951@aol.com and twitter at @fryan1951.
