HR graduates are among those least likely to stay with their first employer, but formal and structured programs can aid retention, new research shows (view an interactive infographic of the results).

The study, by Onetest, of 2851 former graduates who completed psychometric tests between 2002 and 2011, found the HR industry retains only 26 per cent of its graduates, compared to the best-performing industry - mining, oil and gas - which retains 82 per cent.

Onetest's head of psychology Cherie Curtis told HR Daily the study shows organisations that are larger in size and run formal graduate programs are more likely to retain graduates over time.

It also found formal graduate programs result in 16 per cent higher industry retention rates and that there are large differences in satisfaction rates between grads who are employed in a program compared to those who are not.

"If an organisation doesn't have the capability, or the funding, or the resources to provide that level of structure, they are going to face that challenge of retaining those employees over time," Curtis says.

HR is not as varied a discipline as some others, she says, and "probably more succinct in terms of content, which may influence the degree of structure or formality around that program that's being offered to the graduates".

"HR as a department is always resource stressed. The scope of function that they perform is huge and the time they have available to provide a dedicated formal program within what they do is always a delicate balance. So I think that's one of the great pressures," she says.

Funding is also a concern for HR, she says, but a way to overcome these obstacles is by "looking for ways to do things smarter rather than harder". For example, using technology for administration work ensures there is more time to focus on HR graduates and a formal grad program.

Further, managers should be ensure they are aware of key values graduates have.

"We know they are looking for clear ability utilisation, achievement and formal recognition programs within the framework, and opportunities for advancement," Curtis says.

Graduate recruitment

In a webinar held yesterday, Onetest consultant psychologist Salih Mujcic said grads who are offered positions within organisations with formal graduate programs report being "much more satisfied with their recruitment process".

"This may point to the fact that large organisations, or organisations that have formal graduate programs, pay much more attention or provide adequate resources to ensure candidates have a positive recruitment experience," he says.

Graduate programs were responsible for producing 17 per cent more executives than organisations without them, the study found.

Retention rates

The public sector has a high level of grad retention, with 67 per cent of graduates who enter the sector staying on, irrespective of career progression or change of position, Mujcic says.

However, the not-for-profit sector is losing over half of all graduates who enter it, the study found. Mujcic says challenges that contribute to this exit rate include resourcing issues, pay levels and the political landscape.

Industries with the highest retention rates are mining, oil and gas; government; engineering; banking and finance; and utilities. Industries with the lowest retention rates include business and commerce; HR; sales and marketing; hospitality; and consulting.

"Through our analysis we found that the typical graduate spends around 23 months with their first organisation," Mujcic says.

But the number of hours grads work, their starting salary, and the sector, has no influence on the length of time they stay with the organisation, he says, with the organisation's size being the main factor.

"Overwhelmingly, graduates seek an environment in which they can utilise their... skills and abilities, feel recognised for their wins and achievements within the organisation, and have a capacity to advance through the organisation," he says.

"In our study we found that large organisations are actually able to provide up to 35 per cent more opportunities for promotion.

"They're more likely to have structured development programs where grads can actually use a variety of skills [and] we hypothesised that large organisations... are probably more likely to have formal recognition and appraisal programs."

This article was originally published in HR Daily on 19 September 2012