According to SHRM (Society for Human Resource Management), the cost of losing an employee can be up to double that employee\u2019s annual salary \u2013 depending on the type of role and their level of experience, of course. And while that may sound extreme, it\u2019s pretty believable once you break it down into chunks.<\/p>\n\n\n\n
For example, try to put a dollar amount on these items:<\/p>\n\n\n\n
– Finding and recruiting a replacement
– On-boarding and training the new starter
– Lost productivity getting them up to speed<\/p>\n\n\n\n
And that list goes on. But there\u2019s more to it than just the outright expenses you incur. There are knock-on effects that are really hard to price up.<\/p>\n\n\n\n
For example, how do you put a price tag on the institutional knowledge somebody has taken away with them? You learn far more than just your job when you spend time with a company. Then, you\u2019ve got the interruptions to your service, which have a domino effect on customer satisfaction \u2013 another deeply embedded cost right there.<\/p>\n\n\n\n
And what about the negative impact this has on your company culture, too? When an employee leaves \u2013 no matter how amicably \u2013 it sends a message to the rest of your staff: Something out there was better than being in here.<\/p>\n\n\n\n
So, sure \u2013 you can try to put a price sticker on turnover. Many companies have! BrightHR estimates that the average cost of replacing an employee is around \u00a330,000<\/a>. But there\u2019s a lot more at stake than just your cold hard capital.<\/p>\n\n\n\n If there were a single, easy answer to the question of \u201cwhat causes employee turnover\u201d, then we\u2019d have already told you in the first paragraph of this article. Unfortunately, the answer isn\u2019t very simple \u2013 or, rather, it isn\u2019t very simple to address.<\/p>\n\n\n\n But is that because the times they are a-changing? No. These days, employee turnover is caused by the same ingredients it has been caused by for decades. And that\u2019s because whilst the workplace may have changed, people are fundamentally driven by the same things \u2013 they want to be happy, engaged, well paid, and feel like they\u2019re making progress.<\/p>\n\n\n\n William H. Mobley concluded, in his 1977 paper<\/a>, that the most frequently cited reasons for voluntary turnover were dissatisfaction with pay, benefits, and opportunities for advancement.<\/p>\n\n\n\n Read more: Why employees quit: 11 evidence-based reasons<\/a><\/strong><\/p>\n\n\n\n These are still true today. And in our experience, we can further break these down into 6 key factors:<\/p>\n\n\n\n – Poor management If your employees are suffering from the above? Then it\u2019s highly likely they\u2019re looking for a way out.<\/p>\n\n\n\n OK, how about we drop the doom and gloom for a few minutes. We promise you, there\u2019s a positive message to this article! And really, the positive message is this: If you invest in employee retention, you can reduce employee turnover.<\/p>\n\n\n\n Seems simple, right? Well, it is! Investing in employee retention can lead to:<\/p>\n\n\n\n – Increased productivity And one of the best places to start when it comes to investing in retaining your shining stars, is employee engagement. A 2015 report by Steelcase<\/a> found that investing in employee engagement led to three awesome outcomes \u2013 increased productivity, improved customer satisfaction, and lower turnover rates.<\/p>\n\n\n\n Of course, it isn\u2019t all about launching engagement initiatives. In fact, those alone won\u2019t cut it \u2013 and there are some fundamentals you should focus on, too.<\/p>\n\n\n\n We\u2019ve talked about the high cost of employee turnover, and about the benefits of investing in retention \u2013 specifically, engagement as a tool for retention. So now let\u2019s focus on some best practices you can follow to help really get a handle on it. By implementing these strategies, you can create a happier and more productive workplace that employees will want to stay in.<\/p>\n\n\n\n Good compensation and benefits. Offering a competitive compensation and benefits package is vital. This not only helps attract top talent, but it also ensures that your current employees feel valued and appreciated.<\/p>\n\n\n\n Promote a positive culture. Fostering a positive workplace culture that promotes teamwork, respect, and open communication can go a long way in creating a supportive and welcoming environment.<\/p>\n\n\n\n Invest in professional development opportunities. This is another important strategy. Providing employees with opportunities to learn and grow not only improves their skills, but it also demonstrates your commitment to their success.<\/p>\n\n\n\n Encourage work-life balance. We know that you want your employees to be productive \u2013 but it\u2019s about working more effectively, not for longer hours. Encouraging a work-life balance is crucial, as overworked and burnt-out employees are more likely to leave.<\/p>\n\n\n\n Provide recognition and appreciation. Providing recognition and appreciation for a job well done is a simple but effective way to boost morale and retain employees. Celebrating individual and team accomplishments can help create a sense of pride and loyalty towards the company.<\/p>\n\n\n\n By implementing these best practices, you\u2019ll be well on your way to creating a workplace where employees feel valued, supported, and motivated to stay for the long haul.<\/p>\n\n\n\n Beyond the basics, there\u2019s one thing that trumps all. It\u2019s a clich\u00e9, and you\u2019ll have heard countless people say it. But we\u2019ll say it again: communication really is key. For almost anything in life, to be fair. But especially when it comes to retaining your people!<\/p>\n\n\n\n A study by Saks, A. M., & Ashforth, B. E. (1997) found that supervisor communication was positively related to job satisfaction, affective commitment, and perceived organizational support. What does this mean? It means that if your managers are communicating effectively with their teams, then your team members will feel like you care about them \u2013 they\u2019ll be happier at work, and they will stick around for longer!<\/p>\n\n\n\n Some tips to keep communication in tip-top shape:<\/p>\n\n\n\n – Be clear and consistent.<\/strong> Nobody likes to second-guess what you\u2019re trying to tell them, and nobody likes to deal with a Jekyll and Hyde type of manager. Communicate clearly and consistently \u2013 and have your managers learn how to do the same. Getting communication right throughout your organization is important for employee retention. And this means going beyond simply improving communications from head office, or issuing a mandatory training course on \u201cgood communication\u201d.<\/p>\n\n\n\n Making sure your managers are on-board is what will be key here. Your employees often live and die by the relationships they have with their managers, meaning communication on a team level can be the difference between keeping your people, and constantly publishing new vacancies.<\/p>\n\n\n\n Let\u2019s take a moment now to look at a recent curveball. The COVID-19 pandemic has left a lasting impact on the workforce, with remote work becoming the norm for many businesses. But while remote work has enabled companies to continue operating during the pandemic, it has also had a significant impact on employee turnover.<\/p>\n\n\n\n One of the biggest challenges is the changes in work routines and schedules. Employees may have become used to the flexibility that remote work offers, and may now find it difficult to adjust to returning to the office and traditional working hours.<\/p>\n\n\n\n Another challenge is the increased isolation and decreased workplace camaraderie that has come with remote work. The lack of in-person interaction can make it harder for employees to feel connected to their co-workers, and to the company’s mission. This can have a negative impact on employee morale and job satisfaction.<\/p>\n\n\n\n It also goes without saying that remote work can make it difficult for employees to maintain a healthy work-life balance. Without clear boundaries between work and home life, it can be challenging to switch off from work, leading to burnout and increased stress levels. Come on, tell me you\u2019ve never been guilty of sitting at the kitchen table at 10pm catching up on emails?<\/p>\n\n\n\n The need for new retention strategies to address these challenges is more crucial than ever. You need to support employees as they continue to adjust to new work routines and schedules brought about by the pandemic \u2013 some will thrive, but others will wither without your attention.<\/p>\n\n\n\n If you\u2019ve stayed as a mostly remote workforce, then it helps if you can explore new ways to foster that \u201coffice spirit\u201d. For example, by looking at these 24 virtual office games that can bring back that Friday feeling!<\/a><\/p>\n\n\n\nWhat causes employee turnover?<\/h2>\n\n\n\n
– Lack of professional development opportunities
– Poor workplace culture
– Uncompetitive compensation and benefits
– Limited opportunities for advancement
– Poor work-life balance<\/p>\n\n\n\nLet\u2019s be clear: Here\u2019s exactly why you should be investing in employee retention<\/h2>\n\n\n\n
– Lower turnover costs
– Improved company reputation
– Stronger company culture
– Increased employee satisfaction
– Improved customer satisfaction<\/p>\n\n\n\nGetting the basics in place<\/h2>\n\n\n\n
Communication is key<\/h2>\n\n\n\n
– Encourage open and honest feedback.<\/strong> Employees need to feel comfortable sharing their thoughts and ideas, even if they don\u2019t align with the company\u2019s current strategies. Managers should actively seek out feedback and listen to the responses they get.
– Provide regular updates on company developments. <\/strong>Regular updates on company developments, whether it’s through email newsletters, team meetings, or one-on-one conversations, can help keep everyone on the same page.
– Promote an open culture of transparency and trust.<\/strong> Managers should be transparent about company goals, strategies and challenges. This can help employees understand the big picture and feel more invested in the company\u2019s success.<\/p>\n\n\n\nThe impact of remote work and COVID-19<\/h2>\n\n\n\n