But employee turnover and absenteeism continue to challenge growth
Employee turnover in the third sector has returned to a pre-recession high and competition for candidates is set to increase in the next few years, a research consultancy has found.
According to Agenda Consulting’s People Count Third Sector report, which looked at 71 organisations with 62,000 employees and 107,000 volunteers, the average staff turnover in the sector in 2014 was 22 per cent.
This figure was the same as 2013, but markedly higher than in 2011, at the height of the recession, when it was 18 per cent.
Roger Parry, chief executive of the consultancy said the sector was enjoying a “vibrant” period of recruitment, with charity job sites brimming with vacancies and increased levels of hiring.
The survey found that respondents recruited an average of 24 per cent of their staff in the last year. Turnover was highest among non-management employees, and the average length of service for leavers was 40 months.
“There is a high concentration of third sector employers in London and the South East, which makes it easy for people to jump ship and make their next career move,” said Parry. On average, it took 35 days to fill a vacancy in the third sector, according to the report, compared to 43 days in the UK workforce as a whole.
Absence levels were higher in the voluntary sector than the overall UK average, with employees taking an average of 8.4 sick days, costing employers an estimated average of £622 per employee. This was also an increase on 2013, when sick pay cost third sector employers £587 per person, per year, the survey found.
Investment in learning in third sector employers increased slightly, with a median spending rise of £20 per person per year to £344. This was still lower than the average UK L&D spending figure of £513, however.
The People Count report found that third sector employers could do more to increase diversity in their workforce. At least half did not have a single person from an ethnic minority on their senior management team, although there was considerable variation between participants.
Meanwhile, HR’s influence in the development of third sector organisations has increased: 80 per cent of HR directors of the companies surveyed were on the senior management team, a rise of 7 per cent since last year. The median ratio of all employees to HR staff was 58.
Parry said that, while high levels of recruitment meant the sector was buoyant, it could become harder to recruit staff in the future.
“There may be a squeeze on salaries, especially where employers are funded by their local authority or are dependent on state funding, so there will be more competition with the private sector to find staff,” he said.