These days, organizations and businesses of all sizes MUST have and implement effective employee retention strategies; failure to which retaining of employees will be like shooting in the dark.
Did you know that every month 3 million Americans leave their current jobs to look for better ones? Yes, and a study has found that employees who feel not recognized for doing good work are 2X more likely to look for something better.
Unfortunately, this kind of employee turnover is costly given that replacing an employee who has quit costs double their salary. And the turnover cost is different across industries as some employees are paid differently.
In this article, we are going to share with your 14 effective employee retention strategies every employer must implement to keep employees working with their businesses for longer. Statistics show that 31% of employees quit a job within the first six months.
As an employer, to keep your employees from quitting, it’s advisable to nurture and engage your talent regularly.
Keeping reading to learn more.
What is Employee Retention
According to the Business Dictionary:
Employee retention is: “an effort by a business to maintain a working environment which supports current staff in remaining with the company.”
When talking about employee retention, you can’t also miss the terms growth, motivation, engagement, etc. because they all contribute when it comes to keeping employees from quitting.
Employees who have the opportunity to grow and feel exposed will feel motivated to work and are satisfied with the company they work for. This means they are less likely to quit.
Employee turnover is when a company replaces quitting employees (the cost and time lost). It’s, therefore, important for every business owner to know how to manage employee turnover rates to keep the business running successfully for longer.
Retaining Key Talents is Vital
In business, there will always be two types of employees: valuable and those that aren’t contributing too much to the business. The management needs to distinguish between the two and come up with efforts to encourage the company’s employees to keep them happy and stop them from quitting.
- Companies invest heavily both in time and money to groom new hires and make them ready to work.
- Hiring new workers is no easy task.
- Quitting employees may join the competitor.
- Employees who work with the organization for longer understand the policies and guidelines and can welcome changes easily.
- Employees who work in an organization for longer are more loyal.
Downsides of Poor Employee Retention
As said above, employees who quit may join the competitor. But that’s not all; here are a few adverse effects of higher employee retention rate.
More time is lost- We’ve mentioned above that hiring new workers is no easy task. It takes time to hire new employees and train them. It is also extremely expensive than retaining them.
Loss of valuable knowledge- This is especially evident when the employees quit and join the competitor. They go with valuable knowledge they have acquired in your company and this gives your competitor the edge over you.
Customer service surfers- Customers come to buy from your business because of your employees. Employees attract and engage with customers thereby developing lasting relationships with them which translates to the longevity of the company. If they quit, customer service surfers and the company’s growth weakens.
As you can see, no organization or company can work without effective employee retention strategies. We will share with you effective strategies for retaining employees to don’t worry. But before that, let’s take a look at what the numbers are saying about employee turnover:
Surprising Employee Turnover Statistics You Need to Know
If there is anything valuable a company can buy then it’s the employee. An employee is a valuable asset to businesses of all sizes. That’s why companies should not take losing employees for granted.
- Over 80% of full-time employees are actively looking or are open to new opportunities.
- 34% of females and 25% of male employees are more likely to quit their jobs because of a bad manager.
- 39% of men and 33% of females who are underpaid are more likely to quit a job.
- 46% of HR managers see employee retention as the biggest concern.
- At least 25% of millennials have work with more than 5 different companies.
- The cost of replacing a quitting employee is anywhere from 16% to 213% of employee’s salaries and varies with position and industry.
As you can see, the statistics are alarming and it’s therefore important than ever for every company to implement effective employee retention strategies.
And here are the strategies to implement to keep employees from quitting their jobs.
14 Effective Employee Retention Strategies
1. Hiring Suitable Candidates
Employee retention starts right at the hiring process and 80% of employee turnover is a result of inappropriate hiring decisions.
To keep employees from quitting, only hire the suitable ones. These are people who have the qualities you are looking for in a job and are willing to meet the company’s expectations.
2. Effective Onboarding
Employees need to be educated about the company’s policies and guidelines from the time of onboarding. The way you hire new employees can contribute a lot to whether they will quit early or work with your company for longer.
3. Encourage Freedom of Expression
Employees should be allowed to express their opinions. They should have the freedom to question everything that doesn’t work as expected and voice their opinions. It’s not optional anymore for companies to have open channels of communication. Leaders should always be available to listen to what employees are saying.
4. Acknowledging Employees
Did you know that your employees who feel that they are not being recognized for doing good work are looking for better jobs out there? Employees want to be acknowledged and recognized for their effort in the company.
How much does it cost you to write a “Thank you” note or a letter of appreciation? Recognizing and appreciating your hardworking employees doesn’t have to be costly by the way, just a “Thank you for your hard work” can make the employee feel encouraged and motivated to achieve more.
5. Maintain a Healthy Work-Life Balance
11% of employees have rejected a job that doesn’t offer them time to do their own things. Overburdening employees has also been seen as a huge impediment to employee retention. Relieve the pressure from your employees by allowing them to work remotely or sharing the workload.
6. Encourage Teamwork
Everyone in your company can contribute ideas and come up with solutions to problems. Are you allowing them the opportunity?
People working together are more likely to achieve results that loners. You must foster a culture of collaboration where employees even though they work on their own, practice teamwork.
7. Have an Employee Compensation Program
Employees that don’t get compensated are more likely to look for other jobs outside your company. Given that hiring new talent is costly than retaining existing ones, every company needs to compensate every deserving worker. You can compensate your employees by increasing their salary or even offering them yearly bonuses.
8. Have Flexible Working Arrangements
Do you have a strict working arrangement? Do you experience a huge employee turnover? If yes, then work on your working arrangements.
Some companies only allow employees to come to work from 9 a.m. to 5 a.m. If you want to keep employees working with your company for longer allow them some flexibility with the time of reporting to work.
9. Be a Manager and Not a Boss
Everyone wants to be a boss and only a few a willing to take up the leadership responsibilities. People are looking to work under leaders, not bosses. If you want to keep your employees, be a manager/leader and not a boss.
10. Watch Your Managers
Employees quit because of bad managers. If you asked your employees why they quit, you will be shocked to hear that the manger you employed is a toxic one.
In most cases, frictions between employees and managers or staff and customers can make them quit their jobs. Make sure your managers aren’t making your employees leave.
11. Switch Responsibilities
Repetitive work is boring and tiresome. Allow employees to switch responsibilities. You can also give them a chance to work with other departments. This helps to build co-worker relationships.
12. Recognize Achievements Big or Small
A milestone achieved is a milestone, whether big or small. Take the time to appreciate employees who have achieved a milestone whether it’s a huge project or a small one.
13. Encourage a Feedback Culture
Without seeking feedback from your customers it would be hard for you to know how to serve them well. Your employees are also not different from your customers. Providing them with regular feedback (individually, as a team, or when an employee is advancing career-wise) helps them to understand and work on achieving their goals which ultimately helps to reduce employee turnover.
14. Provide Mentorship Programs
Mentoring your new hires helps to reduce employee turnover as well. Make sure you have better mentorship programs to offer guidance to new hires during and throughout their time working with your company.
Hiring New Talent is Extremely Expensive
Have you already put in place these effective employee retention strategies for your business?
If you have these strategies for retaining employees in your company, make sure you revisit them regularly. If you don’t have any or some, start implementing them to reduce employee turnover.