Analysis | Lessons on retention, pay and progression from big data from big companies

What ranking employers reveals

The British Opportunity Index examined access given to inexperienced workers, pay growth and pay relative to those in similar positions, promotion opportunities, and employee retention as a proxy for company culture. The data was drawn from online job posts, profiles, CVs and salary information from platforms such as LinkedIn and Glassdoor. Organisations were then ranked by four key metrics:

• hiring
• pay
• mobility
• culture.

The resulting scores allow for a comparison by occupation and by company. Employers can use the index as a helpful benchmarking tool. By selecting a similar sized company as a reference or avoiding the common pitfalls, companies can target specific areas where they can look to improve practice.

Employer impact vs industry impact

The research found that workers’ career outcomes were linked to the companies they chose to work for rather than to the occupation or industry they were in. How and to what extent companies supported their employees appear to be a characteristic of corporate practice and a specific choice to invest in talent and in particular aspects of the employee experience. This means it was the choice of company that was the key determinant to career progression.  

There were no patterns across similar industries, suggesting that the type of organisation is a relatively unimportant factor in rankings. Companies from any sector can set ambitious goals to provide high levels of opportunity and job satisfaction for their employees, with no disadvantages seen for particular types of companies.   

While some companies received high scores, none excelled on all four indicators. Company scores varied widely, with considerable differences between those companies at the top and at the bottom of the index.

Gulf in opportunities between top and bottom-ranked companies

Figure 1: Comparison of top-ranked with bottom-ranked companies on access, progression and retention

^{Source: The Economist}

Data from the index shows that companies in the top 20% for promotion are 2.3 times more likely to promote workers internally than those in the bottom 20%. Top companies pay 2.7 times more for the same roles and they are 85% more likely to hire workers without degrees for the same roles, compared to bottom ranked companies within each indicator.

Employee-first employers can attract talent

The index provides insight into the variance of job opportunities afforded by different companies. Even companies in better-resourced sectors such as finance differed considerably in the extent to which they invested in their employees. Like any company, they will choose to invest in some aspects of opportunity at the expense of others.

Jobseekers can use the index to guide their search for their next employer. Depending on their circumstances, they may value a hiring company’s focus on one aspect of opportunity over another. It is therefore in companies’ best interests that they score well across the board.

At the same time, people practitioners of large employers that have been included can use the index for internal benchmarking to see how their company compares to competitors and to identify areas for improvement.

Lessons for the people profession

This research highlights the power in big data. But to have a firm grasp on the areas of improvement, an organisation needs to ensure it is collating and utilising internal data.

On promotion, HR can implement processes to develop, engage, and retain individuals they value. To be effective, these processes need to align with strategic business objectives.

On pay, it is important that firms remain competitive, or risk losing talent. Undertaking job evaluation and market pricing helps to gather internal and external data on roles in an organisation and equivalent jobs with other employers or in other sectors.

On access, many firms over rely on university education as a signal of ability. Given the state of graduate overqualification in the UK, HR and hiring teams can facilitate other forms of entry into the labour market for those with lower levels of qualifications, through mechanisms such as work experience, internships and apprenticeships.

On culture, taking steps to make an organisation somewhere where an employee would wish to spend their career can be an impactful move. Organisations and those in the people profession should understand what good culture looks like and seek to set a standard in this area.