Recognize This! –If employee retention is important enough to list as a substantial risk factor to meeting financial expectations, then it should be important enough to find ways to reduce employee stress.

I just read an interesting story in Forbes, which noted that a common phrase included in the risk factors on 10-Q forms for public:

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“If we are unable to retain our existing senior management and key personnel and hire new highly skilled personnel, we may not be able to execute our business plan.”

Employee retention is a big enough issue, public companies list it as a significant risk factor that could prevent the organization from reaching financial targets. Yet, organization leaders do not see the primary problem behind retention issues.

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There’s some evidence that companies are starting to pay attention to the dangers of overworking employees. But many organizations, it seems, fail to recognize the risks. “Work-related stress” was the reason top-performing employees in the U.S. most frequently cited for why they would leave their organization, according to a recent report by consulting firm Towers Watson & Co. and professional association WorldatWork. However, when employers were asked about reasons high performers would jump ship, stress didn’t even rank among their top five most frequent responses, according to The 2011/2012 Talent Management and Rewards Study, North America.

That disconnect helps explain why more organizations are struggling to hold on to key talent. The percentage of U.S. companies that are having difficulty retaining critical-skill employees has risen from 16 percent in 2009 to 31 percent in 2010 to 36 percent in 2011, according to Towers Watson’s report.

That mirrors results of our own Workforce Mood Tracker survey from September 2011 showing 38% of US employees are actively looking for work (up from 36% in January 2011).

Employees are clearly stressed and clearly communicating that up through the ranks, mostly through disengaging from the work simply because they can’t keep up any more. But leaders aren’t listening. And that puts your organization at risk.

What can you do about it? Star t listening. Read the tips I offered a few weeks ago on Compensation Café.

Are your employees visibly stressed? What are you doing about it?