Most consulting firms we’ve spoken to have reported similar experiences when it comes to the issue of talent retention within their organisations: gradual year-on-year increases in attrition rates in the lead-up to 2019, followed by a steep drop-off in 2020, and then a rebound in 2021 to unprecedented levels. While the pandemic has certainly exacerbated the problem of attrition, it’s clear that its origins stretch back much further. This is a problem rooted in longer-term generational shifts in attitudes towards careers, alongside the increased competitive pressure being put on consulting firms from the technology sector. In total, 55% of young consultants now expect that they will remain at their current firm for less than three more years.
To some extent, firms may be able to address this challenge by improving their employee value propositions. Over the past year or so, we’ve seen many of the larger consulting firms launch dedicated initiatives to protect the mental and physical wellbeing of junior consultants. They’ve started, for example, to provide clearer guidance to project managers on setting work-life balance expectations with their team members and their clients; and some firms have now made “respect and inclusion” charters a standard part of project scoping and set-up.
But these initiatives can only go so far; firms are going to have to accept, ultimately, a higher baseline level of turnover within the bottom and middle layers of the resource pyramid. And indeed, there may be some advantages to that. A higher rate of turnover will mean a larger alumni community, for example. Increasingly, we’re seeing firms start to recognise the importance of maintaining close relationships with those alumni, in order to maximise their ability to use those relationships to open new accounts, and to make it as easy as possible for those people to return to the firm in the future should they wish to.