Retention, job satisfaction and people management

Earlier in this chapter, the importance of managing for improved performance to enhance individual and organisational performance over time and identify and develop required capabilities was discussed. The retention of employees is another important factor related to these issues. Key factors affecting the retention of employees are job satisfaction and the quality of management. Consequently, it is critical that agencies develop a thorough understanding of employee perceptions around these issues and how they impact on employee intentions to remain in or leave the APS.

Employee intentions to leave the APS

In 2004–05, employees were asked whether they intended to leave the APS in the next three years. Sixty per cent responded that they had no intention of leaving, 25% were not sure, 4% intended to leave in the next year, 4% intended to leave in the next 1–2 years and 7% intended to leave in the next 2–3 years. Table 8.4 outlines the range of reasons given by employees for their intention to leave the APS. Of those who foreshadowed leaving the APS, the top five reasons were: to retire (38%), lack of job satisfaction (36%), to pursue job opportunities outside the APS (35%), poor management (32%) and feeling under-valued (31%).

Table 8.4: Reasons for intending to leave the APS—relevant employees, 2004–05

Note:(a) Includes only those employees who indicated they intend to leave the APS in the next three years.

Source: Employee survey

Employees aged under 25 years and between 25 and 34 years were more likely to indicate they would leave to pursue job opportunities outside the APS, whilst those in the 35–44 age range intended to leave primarily due to poor management. Those employees aged between 45 and 54 years and over 55 were more likely to leave to retire.

Employees located in the ACT were more likely to indicate they would leave to pursue job opportunities outside the APS whereas those located outside the ACT indicated that they were more likely to leave to retire.

Job satisfaction

As illustrated above, job satisfaction is a key factor in the retention of APS employees. The employee survey once again asked respondents to choose the five workplace factors (from a list of 15) that most affected their level of job satisfaction.¹⁵ Respondents were then asked to indicate their level of satisfaction with the factors most important to them.

Table 8.5 shows that the top five most important job satisfaction factors, as rated by employees in 2004–05, were the same as in 2003–04.

Table 8.5: Job Satisfaction—employees’ most important workplace factors, 2004–05

Note: (a) Of the employees who nominated this factor as one of their most important and rated it, the percentage of employees who were either ‘very satisfied’ or ‘satisfied’ with the factor in their current workplace.

Source: Employee survey

Consistent with last year’s survey results, Table 8.5 indicates that, while the two most important workplace factors influencing job satisfaction (‘good working relationships’ and ‘flexible working arrangements’) had high satisfaction ratings (84% and 83%, respectively), two of the top four most important factors (‘salary’ and ‘regular feedback/ recognition for effort’) continue to have relatively low satisfaction ratings (49% and 48%, respectively).

The largest relative fall in satisfaction levels occurred in ‘chance to be creative/ innovative’ (from 57% to 51%). Falls also occurred in ‘regular feedback/ recognition for effort’ (52% to 48%) and ‘opportunities to develop skills’ (58% to 54%).

Those factors that experienced the largest relative falls in satisfaction levels last year (i.e. between 2002–03 and 2003–04) either remained the same or fell even further. ‘Opportunities for career development’ remained stable at 32% after falling from 43% in 2002–2003. ‘Appropriate workload’ fell from 49% in 2002–03 to 40% in 2003–04 to 38% in 2004–05. ‘Salary’ fell from 62% in 2002–03 to 51% in 2003–04 to 49% in 2004–05.

Levels of satisfaction varied considerably between some of the factors according to sex and classification level. Chapter 9, ‘Workplace Diversity’, contains further analysis of job satisfaction, in the context of examining the job satisfaction factors for particular groups, namely women, Indigenous employees, employees with a disability, people from a non-English speaking background, and older and younger workers. In relation to satisfaction rates, while satisfaction with many of the factors remained fairly constant between the 2004 and 2005 surveys, a number of factors recorded substantial falls in satisfaction ratings.

A summary index was again created from the results of the job satisfaction question in the employee survey. The index ranges from zero (the employee was very dissatisfied with all of the factors nominated) to 10 (the employee was very satisfied with all factors). An index of five translates to an employee being, on average, neither satisfied nor dissatisfied with their nominated factors.

For all employees, the proportion with a job satisfaction index over five was 71% (down from 74% last year and 76% in 2002–03). As in previous years, the job satisfaction index varied considerably between the 21 large agencies, from over 83% to 62%. There were only two agencies, BoM and DFAT, where 80% or more of employees reported above average levels of job satisfaction. There were five agencies, Customs, ASIC, Centrelink, DEWR and Finance, where less than 65% of employees reported above average levels of job satisfaction.

Consistent with the patterns identified in last year’s report, job satisfaction was generally unrelated to age, except for employees over 55 years, who had higher levels of satisfaction (78%). Job satisfaction continued to be higher for employees located in the ACT (75% compared to 69% for employees outside the ACT), and varied strongly by classification levels with the SES (87%) having higher levels of job satisfaction than EL employees (77%) who, in turn, have higher job satisfaction levels than APS 1–6 employees (69%). There appears to be little difference in overall levels of job satisfaction between men and women and between full-time and part-time employees.

The following comments made in the employee survey are illustrative of the spectrum of employees’ views about what influences their job satisfaction.

People management capability

As discussed above, many of the factors which impact on employees’ job satisfaction relate, either directly or indirectly, to their manager. Consequently, with this in mind, it is interesting to examine employees’ views about the effectiveness of their immediate supervisor in the area of people management.

The employee survey again asked employees about how effective their immediate supervisor was at managing people. Compared to 2003–04, a slightly lower proportion of employees (51% in 2004–05 compared to 53% in 2003–04) rated their supervisor as highly effective at managing people. However, this still compares favourably to 2002–03 when only 47% rated their immediate supervisor as highly effective at managing people.

As was the case in 2003–04, supervisors were again more likely to be rated as more effective by younger employees and employees working in the ACT. The SES (55%) were again more likely than EL employees (50%) and APS 1–6 employees (52%) to have rated their supervisor as highly effective at managing people.

Supervisors were also rated as more effective by employees who were proud to work in the APS and/or their current agency and by employees who felt that their productivity had increased over the past 12 months.

Not surprisingly, employees who listed either ‘having a manager that encourages and manages innovation’, ‘receiving effective feedback from my manager’ and a ‘good working relationship with my manager’ among the five most important factors that helped them increase their productivity were also more likely to rate their supervisor as highly effective in people management.

Employees’ different perceptions about their supervisors’ people management skills were also reflected in the comments provided by some employees.

Increased attention and efforts by agencies in the area of people management are likely to have a positive impact on employee job satisfaction and possibly on productivity.

15 List of factors changed slightly in 2004–05

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