Career progression and training trump bonuses and other financial inducements when it comes to stemming the flow of supply chain workers quitting their jobs, according to a new report from the US
WorkStep – a recruitment platform for supply chain employees – studied career feedback from more than 16,000 employees in 164 firms and found pay didn’t even make the top five reasons for the high level of frontline worker turnover.
While the report is based on employees in the US, some believe the findings may shed light on how businesses in the UK can address the current shortages of warehouse workers and lorry drivers.
According to a recent Road Haulage Association (RHA) survey, there is now a shortfall of more than 100,000 qualified drivers in the nation after thousands of EU drivers returned home following the Brexit deal.
In the past few months, haulage companies, retailers and the government have tried to attract new recruits using wage rises and welcome bonuses, for instance, Amazon recently announced £3,000 sign up bonuses for warehouse staff joining in the lead up to Christmas.
However, the WorkStep data suggests these are limited fixes and not a long-term solution.
WorkStep’s research indicated that career growth, job opportunities, workplace safety, orientation, feedback and coaching were far more important to staff than pay. The company said that with US supply chain turnover rates set to exceed 50% in 2021, companies needed to reevaluate their approach to hiring and retaining employees.
CEO of WorkStep, Dan Johnston, said: “As the supply chain workforce shortage continues, companies like Amazon and Walmart are desperately trying to fill positions. They’re offering record-breaking pay raises, hiring bonuses and other financial incentives to attract and retain workers. But they are throwing money at the wrong problem.
“Pay isn’t a top reason for frontline turnover. To successfully retain their talent, companies need to address the real issue – and that’s career growth.”
Where career growth is not made available, WorkStep research suggests skilled talent will simply move to where it is. This correlates with recent RHA research which found that many lorry drivers had not only changed employer but moved to a different sector which they felt offered a better lifestyle and greater opportunities.
Johnston said its data showed companies need to provide promotion plans, training and leadership feedback to head off a potential staffing crisis.
Around 18% of the staff surveyed by WorkStep were categorised as drivers, with 5% listed as truckers. Some 42% of respondents were warehouse staff while around 30% worked in production.
It concluded efforts by brands such as Walmart and Target to raise wages, provide sign-on bonuses and other financial incentives will not attract and retain workers unless they are part of a broader job improvement package.