Managing and Improving Employee Retention
Employee turnover is one of the more costly aspects of business. The loss of productivity coupled with resources being redirected to filling the vacancy can cost companies one-half to two times the employee’s annual salary. No business is immune to this. Amazon, for example, had a turnover rate that was double the industry average during the first few months of the COVID-19 pandemic. To retain employees, businesses need to do more than offer competitive salaries and benefits; they also have to keep employees happy and engaged. By also providing growth opportunities, making them feel valued, and offering lifestyle enhancement benefits you further encourage them to stay, as we’ve previously discussed.
There are numerous reasons employees leave. According to the U.S Bureau of Labor Statistics, the most commonly cited reasons are:
- They want higher compensation
- The work isn’t challenging enough
- There is no clear path to grow within the company.
- They lack access to health insurance and a retirement savings account.
- They don’t feel valued.
- Flextime isn’t an option.
- They have problems with a manager.
- They’re burned out from being overworked and/or stressed.
- They’re not recognized for a job well done.
- There is no clear direction from management.
- They don’t fit with the overall culture of the company.
Pay attention to burnout, lack of growth opportunities, and compensation as motivators for leaving.
On the other end of the spectrum, employees are more likely to stay when they feel they have:
- A competitive salary
- A high level of engagement
- Flexible work schedules
- A clear path to advance within the organization
- Access to learning and development
- Comprehensive benefits
- Supportive and empathetic management
- Respect and gratitude
- A great company culture and team
- Support for the company’s mission
Employees are more likely to stay when they feel they are properly compensated for their work, can develop professionally, and feel valued.
That said, you can have the best retention plan in the world, but if it’s not resonating with your employees, it’ll be a waste of time. That’s why it’s vital to keep track of your plan to ensure it’s reaching goals to keep your employees around. Exit interviews are powerful tools to give you an honest assessment of how you are doing. Insights gained from them can help you reduce turnover further down the line.
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