Every year, thousands of people decide to hand their notice in to their current employer and take their services elsewhere.
Some 18 per cent of Midlands businesses have lost at least one in five of their employees in the last twelve months.
This has a major impact on the bottom line as it is estimated that it costs between six months and one year's pay to replace a leaver.
In a recent UK wide survey of companies with turnovers from £10 million to £1 billion, respondents put people investment among the top three issues to tackle in order to boost competitiveness. Further-more, staff retention, productivity improvement and recruitment quality were all cited as key factors.
On staff retention, a lack of career progression is one of the major reasons why people choose to leave and the survey illustrates that this issue is being poorly managed by many businesses. Forty-five per cent of companies do not have senior executive succession plans in place and only 11 per cent said they had proactive schemes for future stars.
Turning to productivity, the survey suggested a tendency to focus on attendance not performance; however, more effective measures are required to monitor employee performance.
So what can businesses do to improve the situation?
The role of the HR function is critical, yet some businesses continue to treat HR as an administrative function.
A key step is to ensure its elevation to strategic partner. In doing so, there is an opportunity to look at learning and development; the total pay package including shares, bonuses and long-term incentive plans; appropriate means of communication and measurement metrics.
Clearly then, there is room for improvement and this must happen if the region is to maintain its place in the global market. Successful businesses are those who have evolved the HR function from the paternal "tea and sympathy" to involvement in business decision-making.