January 7 2007 - The 2007 survey by Hewitt Associates of the 50 Best Employers in Canada published in Report on Business magazine and La Presse offers insights on coping with workforce challenges such as recruitment and retention. Based on responses from more than 100 000 Canadian employees at nearly 120 companies with additional input from over 2000 business leaders and human resources professionals, the survey found that the Best Employers have lower turnover, receive more applications and experience better business results.

Organizations earned their place in the list primarily because of high employee engagement (emotional and intellectual commitment). The survey found an average of 77 per cent engagement among employees at a typical Best Employer, compared with 55 per cent at other participating organizations. This varied with age. Overall the average engagement score for those aged 61 or older was 74 per cent. Generation X (26 to 40 years) was the least engaged at 61 per cent. Employees aged 25 years or less were only slightly more engaged (63 per cent). Employees working in financial services, pharmaceutical, professional services, and construction and engineering are more likely to be engaged than those working in catering, metals and mining, food products, or gaming.

Neil Crawford, leader of Hewitt's Best Employers in Canada study, said:

"When we measure engagement, we're not simply determining whether employees are happy or loyal. We're gauging the emotional and intellectual commitment employees demonstrate for the organization for which they work. If employees feel a strong commitment, they're likely to speak positively about their employer to others, stay with the organization, and do all they can to help it achieve its business goals."

The study found relatively similar employee engagement scores across Canada but two regional extremes emerged - Alberta and Quebec. Researchers suggest that Alberta's thriving economy has resulted in numerous opportunities and made recruitment and retention difficult for employers. The survey found that Alberta had the lowest employee engagement in the country (61 per cent) compared with the national average of 63 per cent and 71 per cent in Quebec, where engagement rates are highest.

Ted Emond, senior Hewitt consultant, commented:

"The labour shortage in Alberta has some employers - especially in the highly competitive oil, gas and energy sector - offering signing bonuses and other forms of additional cash compensation to attract and retain workers. However, while it's important to offer competitive salaries, our analysis of employee data, even from Alberta, suggests that other factors, such as managerial support, recognition, work processes, and opportunities for learning and development, have a bigger impact on employee engagement."

The survey found average voluntary turnover rates at the Best Employers of 9.4 per cent for full-time employees and 22.4 per cent for part-timers, compared with 12.4 per cent and 33.6 per cent, respectively, for other participating organizations. Similarly, the 50 Best Employers receive an average of 47 applications for every externally advertised vacancy, compared with an average of 30 received by the 50 lowest ranked participants. The 10 lowest ranked organizations received an average of only 17 applications.

Neil Crawford explained:

"Engaged employees feel very much like 'part of the team'. They understand the rules of the game and the position they play. The employer - the coach - knows what it takes to motivate the players and provides them with what they need to succeed. This teamwork produces results. Each Best Employer has adapted this basic approach to its own business environment, and - not surprisingly - has found that others want to join its winning team."

Publicly traded companies in the Best Employers list experienced an average compound annual growth rate in net sales of 12.9 per cent and annualized cash flow returns of 14.7 per cent over five years, compared with 4.9 per cent and 6.5 per cent respectively for companies among the 20 lowest-ranked.

Ted Emond said:

"By participating in the Best Employers in Canada study or the companion study for small and medium employers conducted by Queen's University's School of Business, any organization in Canada with at least 50 employees may determine its employees' engagement level, as well as what it can do to drive engagement higher. The 50 Best Employers in Canada for 2007 have already figured out what it takes to engage their employees and, as a result, are better equipped than other organizations to meet current - and future - workforce challenges."

Neil Crawford added:

"The HR programs at many organizations have been designed by Baby Boomers to meet the needs of Baby Boomers, so it's not surprising that many younger workers don't feel connected to their employer. In order to drive high engagement, organizations really need to listen to groups of employees that differ by age and other factors to find out what will make their work more meaningful."

Researchers suggest that labour shortages and competitive recruitment for a variety of skills and experience will result in more diverse workplaces.

Ted Emond said:

"A generic approach to workplace policies is no longer appropriate. Programs must be flexible enough to allow a certain degree of customization so that employees can tailor them to meet their own priorities."

The study concludes that to attract and retain younger employees, organizations must enhance training and development opportunities, work/life balance policies, and enable control over work. It suggests that older employees will respond to interesting work, supportive supervision, and skill development opportunities.