Thursday, June 20, 2024

PH employers using better rewards system to address high turnover: study

Employers in the Philippines are addressing fatigue and high turnover with improved employee experience and better rewards, the Mercer Global Talent Trends (GTT) Study 2023 said.

Professional services firm Mercer further said companies in the Philippines have remained relevant by prioritizing employees’ evolving expectations for flexibility and financial well-being.

Gaps in addressing the job security of special populations like gig workers and leveraging technology persist, it said, adding that despite economic headwinds, nearly six in 10 executives globally expect their firms to post stable or high growth.

Yet, when planning for the year, leaders in Asia are most concerned about the increasing cost of capital and debt, persistent inflation, a tight labor market, and fierce competition for talent.

Human resources (HR) leaders in the Philippines echoed similar sentiments in Mercer’s Global Talent Trends (GTT) Study 2023, which includes a pulse survey conducted with close to 2,500 HR leaders globally.

To address these challenges, HR leaders responding to the survey – representing 66 companies – said they are looking to improve the employee experience for key talent (76%), improve their total rewards strategies (68%), rethink compensation structures (65%), and deliver on total well-being (65%) this year.

Key findings of this year’s survey include the need for employers in the Philippines to enable and build skills-based organizations, and enhance their company culture to remain successful.  

Nearly seven in 10 employees said last year that not being able to work remotely or hybrid permanently is a deal breaker when considering whether to join or stay with an organization.

In the Philippines, 74% of the companies surveyed provide flexible working options for all their employees. This is significantly higher than Asia (50%) and Global (56%) averages.

To combat the impact of inflation, 48% of companies in the Philippines (versus Asia’s 26%) are using bonuses instead of base salary to increase employee’s total compensation package, while 35% (versus Asia’s 29%) are implementing adjustments across the entire workforce.

However, just 17% of employers in the Philippines (versus Asia’s 22% and Global’s 29%) are providing a cost-of-living adjustment or other wage increases for the most impacted markets, which may be a more sustainable way of managing compensation for organizations in the longer term.

To attract and retain talent, organizations need to differentiate themselves beyond having fair pay policies, and also prioritize employee well-being, which encompasses physical, mental, social and financial well-being. Almost all respondents (97%) are focusing on introducing or improving benefits offerings that matter.

Compared with the Asia average, the Philippines generally fared better in supporting employees’ well-being. For example, 65% of employers (versus Asia’s 40%) have addressed the stigma of mental health through dedicated campaigns, and 53% of them (versus Asia’s 39%) have redesigned work with well-being in mind such as having no-meeting days and balanced workloads.

However, support for special populations like gig or freelance workers trails Asia (37%), with 28% of employers providing adequate job security.

The high attrition rate continues to plague companies in the Philippines, and the significant supply and demand gap in both supply and skills of workers has highlighted the critical role organizations play in safeguarding the future employability of their workforce.

Employers in the Philippines outperformed their Asian counterparts in learning and development programs as they proactively nudge employees to undergo training (71% versus Asia average of 60%) and have a clear understanding of overall talent development needs (63% versus Asia average of 56%). 

There is room for companies in the Philippines to further review their talent mobility opportunities (27%) which are less common than the Asia average (39%).

Employers are also slower to adopt and leverage tools and technology such as AI to understand skills needs (16%), with just 14% of them having in place a robust assessment of technical skills.

“Our new shape of work, in the post-pandemic era, could bring about new and unexpected challenges for many organizations in the Philippines. While many have pivoted successfully with updated rewards and benefits offerings, employers need to remain agile and flexible in order to adapt quickly to new conditions and fast-evolving employee expectations,” Floriza Molon, career business leader at Mercer Philippines, said.

“Leveraging and maximizing the multitude of tools and technology available for skills assessment, training and talent development will allow firms to refocus their efforts on improving the employee experience by building an enabling company culture and designing effective total rewards programs that are based on how their workforce can thrive.”

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