Why Employees Leave

This month is the 30th anniversary of my career as an accountant. When I searched for self-study CPA continuing professional education courses to take this year, I was drawn to one that has nothing to do with accounting, based on a book by Leigh Branham, The 7 Hidden Reasons Employees Leave. This topic intrigued me because over the years I have left a half dozen jobs for various reasons, often wishing that things would get better so I could stay. 

The author of the course gathered information about why employees voluntarily leave a company from a "Decision to Leave" survey on his "Keeping the People" website and from research from the Saratoga Institute. The Institute estimated that the cost of losing the average employee is equivalent to one times the annual salary. Others say the true cost depends on who you lose - entry level versus mid-level or highly specialized. There is also the hidden cost of employees becoming disengaged long before they leave; unhappy employees are not fully committed to the interests of the company. 

Recently in one of my company's quarterly "town hall" meetings, an employee anonymously asked a question about the high employee turnover we've experienced since the company laid off workers this spring. The senior executive leading the meeting responded with a "see no evil" kind of answer. He told us to look back at a slide he had presented earlier about the new people we've hired. Speaking for myself, I would have liked him to acknowledge that those of us who are left are feeling the pain of losing valued coworkers and we long to feel like valued assets again.

Sadly, management is often in denial about employee turnover and its costs because they don't want to know that their decisions are causing people to leave. Many executives and senior managers do not care why employees leave the company; they see it as an acceptable cost of doing business. The consequences of denial and indifference are not as dire when the economy is bad. Employees tend to stay put even if they're dissatisfied. But when the tide turns and the number of jobs increases, employees will leave and the company will have to fight to retain and attract talent.

The Decision to Leave

As I know personally, when people leave a job they often give superficial reasons - higher pay or a "better opportunity." But in reality, outside factors or "pull" reasons only account for about 10-20% of employee turnover. Surveys show that most people leave due to internal or "push" factors like dissatisfaction with the job, the manager, the culture or the work environment. Lack of trust in senior leaders is the number one reason employees leave. The decision to leave is usually not sudden but builds over time. The employee may try to change things for the better, then look for another job passively, then finally actively seek other employment. 

The author of the course also noted that there is usually a triggering or shocking event that pushes an employee to make the final decision to leave. Triggers include being passed over for a promotion, getting a new boss, finding out you make less money than another person doing the same job, a conflict with a coworker, or having to make unreasonable personal sacrifices. In my company, layoffs and the restructuring of our financial services department were triggers that resulted in changes in responsibilities, job titles, managers, and workloads. There have been plenty of reasons for employees to seek other employment. Thankfully, many have stayed.  

Seven Reasons Employees Leave

The author sifted through sixty-seven different reasons employees gave for leaving their jobs and boiled them down to seven reasons. 

1. The job or workplace is not what the employee expected. This reason is probably more common among new hires because their expectations of the job were not realistic. Employers can reduce this kind of turnover by presenting a realistic job preview when hiring, by doing more hiring from within and using more employee referrals. Employers can also make job descriptions more realistic, i.e. only listing the most critical competencies and not a long list of wishes. Yes, it might seem ideal to find candidates experienced in using XYZ software, but many skills are transferable.

With several years of investment accounting experience, I was hired by an insurance company as an investment accountant. But after only five or six months, the company decided to outsource the investment accounting function. Obviously, I did not expect this. I transferred within the company to a regulatory accounting position working with an experienced colleague. She kept the more challenging work for herself and gave me work that was menial. I was not only under-challenged but felt demeaned. I left the company after less than a year for another investment accounting position that offered less money.

2. There is a mismatch between the job and the employee. Because we have a fundamental need to exercise competence and master new skills, employees become dissatisfied when a job does not use their strengths. The best employers are the best "matchmakers."

The best employers do not hold these erroneous beliefs:

• Employees are interchangeable parts that can be moved from one slot to another. The truth is, people are hard-wired for certain kinds of work.
• Skills and knowledge are more important than talent. For long-term success, natural talent is more important than knowledge, though it is harder to identify.
• With the right training and right attitude, people can learn to do well in almost any job. The truth is, although people can perform many activities adequately, they will only excel if a job matches their "motivated abilities." Motivated abilities are the kinds of activities to which we are naturally drawn. 

Sometimes companies make the mistake of promoting a person to a manager role who is not cut out to manage people. Or they make the mistake of thinking an employee's weaknesses can be eliminated by coaching and training when it would be better to just admit that the person is not a good fit and put them in a role that uses their strengths.

3. The employee does not receive enough coaching or feedback. There are a lot of reasons that managers do not give enough coaching or feedback. They may not have enough time. They may fear confrontation. They may not be close enough to what is going on. Many managers are not objective. They may be influenced by company politics or play favorites. The fact that many managers do not address non-performance issues causes morale to suffer for the employees who do perform. Some managers set employees up to fail. They put an employee on a short leash and micromanage. 

The author reiterated a point from the job/employee mismatch section that evidently must happen too often. Highly talented employees may seek to advance their careers by becoming a manager, a position that may not fit their talents or interests. Companies should not penalize top technical performers by forcing them to pursue management positions as the only way to make more money.

4. The employee feels devalued and/or unrecognized.  There are a lot of employee complaints in this area. The employee may not feel appreciated. They may not get the recognition they deserve. They may feel devalued because the employer does not listen to their concerns. They may feel devalued because the employer treats them like a child. The employer may not be providing them with the right tools to do their job. The employer may be underpaying them for the work they do.

My first job after public accounting was a unique one, as the personal accountant for a millionaire. Although he was very generous when it was time to hand out annual bonuses, on a day-to-day basis, he was difficult and demanding. He intimidated everyone. The straw that broke this camel's back was when he berated me in front of another employee. My offense was bringing him bad news from a money manager. On my way back to my desk, the employee who witnessed my verbal lashing said to me, "you learn something new every day." That employee worshiped the ground our CEO walked on. I learned that no one is going to treat me like that, regardless of how well I am paid to take the abuse.

I had another job reporting to an executive manager who operated on the opposite end of the kindness/control spectrum. He wanted everyone to like him. He was afraid of giving honest feedback and feared confrontation so he did not address employee performance issues. He was so bent on treating everyone equally, regardless of his or her contributions, that I did not feel recognized for my high performance. The trigger that finally got me out the door, so unhappy that I left without even lining up another job, was when he showed favoritism to an under performing coworker.

5. There aren't enough opportunities for growth and advancement. Career paths are not as defined as they used to be. The relationship between employer and employee has changed; today the relationship is based on meeting mutual needs. There is no longer an expectation of loyalty. Employees now have to play a bigger role in managing their own careers. Employers can help by providing the right tools. Companies that want to retain good employees should implement a fair and efficient internal job posting process and prevent managers from blocking employees who want to move to another position in the company. Good companies are committed to employee training even if it makes an employee more marketable.

Sometimes you leave a job for more than one reason. I left my job with the millionaire primarily because I didn't like his harsh and condescending management style, but also because I recognized that there weren't any opportunities for growth there. It was a dead end job. I had been doing the same thing for eight years and though it was enjoyable, I wanted the opportunity to learn something new.

6. The employee may be stressed from overwork or may desire a better work-life balance. Employees often feel like they are being asked to sacrifice their personal or family lives for the job. The company may have inflexible hours. The employer may be trying so hard to increase productivity that they sacrifice customer service. Leaders are often out of touch with employees.

The author lumped some reasons for leaving here that I think should have been in a separate category: there are some company cultures that are just plain toxic or neurotic. Employees are seen as costs or resources, not as assets. The employer attempts to control employees and may treat them as if they cannot be trusted. Other employers engage in or tolerate unethical behavior. Management may constantly change direction, driven by management fads and not being committed to a consistent long-term strategy.

7. The employee has lost trust and confidence in senior leaders.  Employees find many issues troubling in senior leaders. There is a lack of trust in their integrity, perhaps due in part to the kind of financial shenanigans that make headlines. Company leaders are often seen as isolated and out of touch or as unapproachable. They may be motivated by greed and self-interest. They demonstrate a lack of trust in and respect for workers. They mismanage change. They communicate poorly. To gain employee trust, a company must have competent leaders that inspire confidence.

Root Cause: Employee Needs are Not Being Met

While employers often think that employees are leaving for more money, the greatest influences on employee happiness and retention are intangible. The way management treats employees is even more important than money. The common theme when employees leave is employee needs are not being met. There are four basic needs that have nothing to do with compensation.

1. Trust. We need honesty, open communication, to be treated fairly and to know that management will keep its promises.
2. Hope. We need something to look forward to - the ability to grow, develop our skills and to advance within the company.
3. A sense of competency. We need a job that is matched to our talents and skills.
4. Feeling worthy and respected. We need to know that if we do our best and contribute to the company that we will be recognized, rewarded, treated with respect and valued as an asset of the company.

Leaving the Manager and Not the Company

This was not listed as one of the seven reasons employees leave, but I think it is a biggie: quite often, people leave managers, not companies. In the past thirty years, I left three jobs because I was unhappy with my manager. As I noted previously, one manager was too hard; one was too soft. Another had just the right level of empathy but lacked competency - what I call an empty suit.

An article by Giovanna Acosta lists three reasons employees leave their managers.

1. They don't communicate goals (or expectations).
2. They don't make a personal connection.
3. They allow for a negative company culture.

I have experienced the negative company culture that results when leaders don't lead. I have also experienced the lack of a personal connection and the feeling of being disconnected from the entire company when I had a manager who did not make the time to talk to me frequently. He was located in another office and frequently canceled our scheduled one-on-one phone meetings. I ended up reaching out to another manager to be included in her team meetings so I wouldn't feel so isolated and disconnected.

The Grass Isn't Always Greener On the Other Side

In my thirty year career, I have learned that the grass is not always greener somewhere else. As someone once said to me, when you change jobs, you trade issues. I traded a job I enjoyed under a difficult manager for an unchallenging job with a nice but passive manager. I traded that job for another job that was much more interesting, but again, I had a passive manager who was afraid to manage. Having said that, I don't regret leaving any of my jobs, even when the jobs I went to were not what I hoped for or what I expected. Every job and every challenge has taught me something about myself and about what I need to succeed. But whatever the issue is at your company, if you are feeling more and more disengaged, it is time to get out.

This Too Shall Pass

There are a lot of things about my current job that I like. The pay and the benefits are good. My work hours are flexible. The location is ideal and when I need to, I can work from home. I like the fact that the company has a career path for experienced people like me who do not want to manage people. I've gotten to do a variety of things in seven years and I really like the people I work with.

I also have ample reasons to want to leave my current job. I have been on an emotional roller coaster for the last couple of years with the uncertainty of looming layoffs and the sadness of losing valued colleagues. I have no sense of stability or certainty about my future with the company. I have lost confidence and trust in senior leaders. I understand the financial reasons for the layoffs, outsourcing and offshoring. But to me, talented, experienced employees are not dispensable. We have lost valuable institutional experience and knowledge that we will never get back. Ultimately, it reduces the quality of our work and hurts our customers.

Having survived the layoffs so far, we continue to shuffle work around. I have been asked to make a list of my job tasks so many times that I feel devalued, like I am an interchangeable part. I have been told that I will be doing something new, then a few weeks later, it changes. I have been stressed from having more work put on my plate, sometimes at the last minute, while managers continue to postpone approving the transitioning of certain of my tasks to other people. I'm still trying to adjust to my new manager - my fourth in seven years. I'm hopeful that she will be a good matchmaker and assign me the kind of work that matches my talents while not trying to force me into managing people.

It helps to know that my coworkers are in the same boat. My coworker, Angela, recently posted a picture on Facebook that said, "Tough times don't last. Tough people do." The hope that things will get better is one reason I have persevered in my job as long as I have. My colleagues make me feel valued even if senior management sees me as nothing but an FTE. I am thankful that so many of my coworkers have chosen to stay through the tough times, though I know that they have a few good reasons to leave. I also count my blessings and thank God for my job because I know how hard it can be to find one.

Tough times don't last. Tough people do.