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By Likha C. Cuevas-Miel, Business Reporter
Local companies are having problems in terms of
keeping their employees in the organization as the demography of
workers in the Asia-Pacific region changes, a human resource
consulting firm recently said.
In a briefing, Watson Wyatt Worldwide, which has
been providing Philippine companies compensation and benefits data
and solutions, said that changes in terms of age group of work force
in Asia have been proven to be a major factor in retaining employees
within an organization. According to Andrew Heard, Watson Wyatt
regional practice director, Asia generally has an ageing population
as a result of falling fertility and rising longevity.
In Singapore, the proportion of population older
than 50 years old is expected to increase from 23 percent to 50
percent over the next 25 years, and many firms in Asia Pacific are
now facing a shortage of fresh skilled labor
Since more affluent countries like Singapore
lack a younger pool of workers, they turn to the younger Philippine
population in recruiting more workers to fill their requirements,
rendering local firms in short supply of talent.
“For employers, hiring and retaining qualified
employees is still a perennial task. More Filipinos are going abroad
to seek work and better standards of living. Due to the increasing
manpower demands especially from the business process outsourcing (BPO)-contact
center industry, qualified new graduates are in short supply as well
as other younger generation workers,” Watson Wyatt said in a
research note.
James G. Matti, Watson Wyatt managing
consultant, said that 50 percent of those that leave their companies
go abroad while the other half are pirated by competitors. To retain
its employees, firms have to look into the factors that make
employees stay and be flexible about it. The consulting firm found
that the number one concern or factor for staying in a company among
Filipino workers is the compensation package, followed by job
security and third is employee benefits.
The BPO or outsourcing and offshoring (O&O)
industry has the highest average turnover rate among all other
industries which is at 23 percent a year, particularly in the
voice-related services which has about 46 to 53 percent turnover
rate per annum. Matti said BPO firms have tried the cash-heavy
route, like giving bonuses, to entice workers to stay. “However,
that didn’t work. Now that things have moved on to a more
predictable level, BPO firms are now moving on to offering more
health and life insurance,” he said.
Employers should also be responsive to the needs
of employees in terms of giving them a choice in the type of
benefits they receive. Since the Philippines moved from an older to
a younger workforce in recent years, especially with the boom of the
BPO industry, the choices of employee benefits have changed. Some
companies now have given workers a choice of whether to monetize
their life insurance benefits, since younger people tend not to
worry much about saving and retirement and instead they are more
concerned about instant gratification like traveling, gym or spa
benefits.
Older workers, on the other hand, choose life
insurance and medical benefits over tangible material things since
they have their families and dependents in mind.
“Benefits like iPods and laptops are now
fading since it is too costly for companies to sustain,” Matti
said. Instead, firms are being flexible with the insurance and
medical benefits and the employees choose what is the best package
for them. “The Philippines, second to Singapore, has the best
medical and insurance programs among the Southeast Asian region.
However the challenge is inflation, which pushes medical costs by 58
percent higher annually,” he said.
Mounting inflation aside, Watson Wyatt has been
advising companies on how to implement total remuneration and
flexible and benefits. By tailoring their benefits to suit their
needs, companies have a better chance of retaining employees. The
firm claims that 92 percent of firms that adopted the flexible
benefits system reported an increase in employee retention.
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