UAE HR leaders in the Gulf Cooperation Council say staff retention is the single biggest challenge for them over the next 12 months, according to a report from international recruitment firm Hays.

The report, DNA of an HR Leader, shows that 60% of HR leaders cite talent management and retention as the most significant areas of focus for the next two years.

The findings show that while employee turnover is a factor that affects companies of all sizes worldwide, it is particularly prevalent in the GCC.

“The relatively relaxed entry and employment conditions of the region mean that the labour market has always been transient in nature, with higher attrition levels compared to other geographies,” Chris Greaves, Managing Director, Hays Gulf Region, said. “We see many expat job seekers migrating to the region for part of their career, in light of the tax free salaries and to save money, before moving back to their home countries. In addition to this, local employment laws allow labour to move relatively freely between employer and therefore many individuals will work for more than one organisation during their time in the GCC.”

“However, the challenging economic climate of the past two years in response to weak energy prices, coupled with the continuous influx of new business ventures has amounted to a more competitive landscape for organisations,” Greaves said. “As a result, reducing staff turnover and retaining of top talent is of much greater significance to employers than previous years. Not only is top talent a critical factor to organisational success, the costs associated with finding, hiring and training resource are also substantial. It is then not surprising that retention and talent management are high on the list of priorities.”

Greaves added that raising pay rates is “only a short-term solution to reducing staff turnover and one which is both out dated and unsustainable in today’s market.” The report states that the secret to success lies in HRs integration with the business, as indicated by the growing 22% of GCC-based HR leaders who sit on the Board of Directors at their respective organisations.

“In the era that we now operate, the HR department is becoming more and more influential and intrinsic to the success of organisations. Employers must work closely with their HR teams to identify and implement enriching training and development programmes that will instill a greater sense of loyalty in their employees,” Greaves said.