Executives concerned about employee retention are finding money is one of the top motivating factors in keeping their workers loyal. 

In March, Robert Half Technology surveyed 1,400 chief information officers and found 27 percent of them ranked increasing compensation as the most popular practice for retaining staff. Twenty one percent highlighted professional development opportunities, and 18 percent said flexible work schedules were a top motivator.

"More companies and managers are worried about people stealing their talent," says John Estes, a vice president at Robert Half Technology. "What CIOs are saying is that compensation seems to be the most effective in improving retention rates."

The respondents were asked to identify which elements were most effective in improving employee retention rates. Six percent noted extra vacation days or time off, while two percent said granting employees company stock or options. At least 11 percent didn't know what strategy would work best in improving their company's retention rates.

"There are definitely some companies asleep at the wheel here," Estes comments.

Katherine Spencer Lee, executive director of Robert Half Technology, agrees attractive pay is a key selling point for IT professionals. However, she maintains it's only one element of an effective retention program. "Creating an attractive corporate culture, which includes everything from training to work/life balance programs, is crucial for keeping valued employees, especially when the hiring environment for highly skilled professionals is competitive."

Valued Experience

Companies also are beginning to reconnect with the idea older workers can be critical to a business, especially when it comes to retaining intellectual property. Retention, says Estes, can take different forms as companies rehire older employees as independent contractors. This can be especially important as companies demand more tech workers who understand their business needs and goals. "You can always get another person that knows technology, but you can't always get another person who really understands my business," says Estes.

Two years ago, when RHT asked CIOs what steps they were taking to improve retention rates, professional development and training ranked as the top motivator, with flexible work schedules and base salary coming in second and third, respectively. Bonuses were fourth.

Now the motivators have changed: "Now CIOs are seeing that increased compensation works best," says Estes. "Companies tried other things but what seems to work best is good, old fashioned compensation."

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