Brazilian workforce needs more than traditional compensation, BCG study finds

09 June 2016 Authored by Consultancy.lat

Brazil is in the midst of a sizable economic and political crisis, falling into a deep recession at the same time as its political system struggles under the weight of a continuing corruption saga. When attempting to reduce employee turnover and increase engagement during periods of economic recession, employers may be less able to use the traditional incentive of increased compensation. A report finds that factors like employee appreciation, career development, learning and work-life balance may be the most critical incentives – both for employee retention and attraction.

Brazil is currently facing crisis on numerous fronts. Its economy contracted -3.8% last year, while losing 1.5 million jobs. As a result of collapsing commodity prices, a further -3.5% contraction is forecasted for this year – leaving the South American country in a deep, dangerous recession. Furthermore, the widening gap between productivity and labour in Brazil – compared to other emerging economies – is another troubling development. Simultaneously, the Brazilian government has been rocked by scandal: President Dilma Rousseff was recently suspended from office and faces the prospect of being removed from power after accusations of unlawful budget manipulation.

In a new report from The Boston Consulting Group (BCG) – ‘Understanding Brazil’s Workforce in a Troubled Time’ – the global consultancy digs into the attitudes of employees in the country, while examining how employers can improve retention and attract talent at low cost during economically troubled times.

Top ten indicators of happiness on the job

Employee values

BCG’s research, which utilises recent interviews as well as survey responses from 11,282 Brazilian employees and 203,756 global employees (representing 189 countries) in 2014, finds that a variety of ‘soft’ values – rather than just compensation levels – are most important to creating an ideal workplace for Brazilian employees. 

The most important factor as rated by Brazilian employees is 'appreciation of one’s work'; this value is also the top-rated factor globally. Everybody, seemingly, wants to know that they are valued for what they contribute to their workplace. 'Learning and career development' comes in second place in Brazil, well above its number six position in global attitudes. 'Good work-life balance' achieves the third-highest ranking among Brazilian respondents, followed by a good relationship with superiors – both in line with international rankings. Appreciation of company values comes is the sixth most important factor. 

Brazilians actively looking for new job

Retaining and attracting staff

BCG’s report finds that Brazilian employees are keener to move onto new opportunities in the early years at a job, with the desire to find different employment decreasing as the length of tenure increases. In the 0-3 year category, 66% are actively looking for new opportunities, while 31% are not actively looking but open to a new role. In years 4-20, 50% respond that they are actively looking for a new position, while in the 20+ year range, only 42% say they are actively looking to a position elsewhere. The research report reveals that manual workers and skilled office workers are particularly eager to find a new employer, at 68% and 53% respectively. In a not so shocking finding, demotivated employees are much likelier to look for a new position in contrast to those who are motivated, at 67% and 47% respectively. 

The research highlights that some levers for higher retention are particularly difficult to create – like seniority and length of service. Addressing employee demotivation is, as such, a good place for employers to focus on. By fulfilling employees’ key workplace preferences, like work-life balance and career development, employers can curtail demotivation and, in kind, lower employee turnover while aiding talent recruitment.

“Competitive pay is necessary, but it isn’t sufficient—that’s one of the big takeaways here,” summarized Thiago Cardoso, report co-author and Principal at BCG’s Rio de Janeiro office. “As a Brazilian company, you’ve also got to know how to say thank you for a job well done, create a collegial atmosphere, and give your people a chance to learn and develop. The companies that do that in the future are going to win the talent war.”

Reasons for working abroad

Overseas experience

The BCG survey also examines Brazilians workers’ willingness to seek employment overseas, revealing a number of differences between global and Brazilian attitudes. The most important factor driving Brazilian workers to seek a position overseas is to “broaden their personal experience”, at 72% (compared to 65% globally). In second is a desire to 'acquire work experience', at 70% of respondents (compared to 65% globally). Wanting to 'experience a different culture' ranks third at 64% (compared to 54% globally), while 'learning a new language” is seen as important by 63% of Brazilian respondents compared to 47% globally.

Moving for 'better career opportunities', the third most important factor for global respondents, ranks fifth for Brazilian workers – with three out of the top five reasons for overseas work experience being personal factors rather than simply career-related (assuming that learning a new language does not further career aspirations).

The survey also notes that few Brazilian workers are actively taking steps to find overseas employment: less than one in ten were actively engaged in job hunting overseas, and only one in a hundred were starting to prepare visa arrangements.

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