At a time when nearly 40% of employees switch jobs each year and 45% of employers tell that they are not able to find employees with the right talent, employee-retention strategies are one of the biggest concerns for talent managers. If you are searching for some ways to improve employee retention, then you are in the right place. First, have a look at these facts:
- By 2030, the worldwide skill crisis will reach a shortfall of 85 million people
- The large the company, the harder it is to find the right fit and retain employees they handle to get on board.
- The average cost of employee turnover ranges from 50 to 150% of the annual salary of the employees.
- Nearly 87% of CEOs say that they have at least a talent challenge and as skill level and experience increase, the trouble with finding required talent rises with it.
The costs linked with turnover are not just restricted to retention and hiring. Employee turnover has a great effect: one lost employee gives rise to lower morale, less knowledge, and less engagement with the customer. And when you add the changing nature of the worldwide workforce to combine, the problem only increases.
Importance of Employee Retention
Employee retention is an important issue as companies compete for talent in a tough economy. The expenses of employee turnover are rising high- as much as 2.5 times the salary of an employee based on the role. And there are several other “soft expenses” too like decreased engagement, less productivity, cultural impact, and training expenses.
The payoff for companies that focuses on employee retention is worth the investment and time. Better productivity, increased performance, high employee morale, and enhanced quality of work are all benefits of an organization.
By focusing on employee retention, companies can retain motivated and talented employees who genuinely want to be part of the company and who are focused on contributing to the company’s overall success.
So, how do we overcome this challenge? How can we develop retention strategies that really work? ways to improve employee retention are:
Invest in employee development- The newest members of the workforce need development opportunities. About 42% of employees say that they will stick with a company if they invest in their development. Offer skill-development opportunities and provide mentors. Give employees opportunities to learn new skills. Facilitate job rotation. Some organizations even go so far as to provide tuition reimbursement to their employees. Choose a strategy that works for your company but ensure all the employees are encouraged well enough to develop and grow in their careers.
Communicate openly- One of the important ways to improve employee retention is to ensure a clear and firm understanding of responsibilities, performance criteria, and job roles. You should be clear with your employees regarding your workplace expectations and company policies.
Customize the benefits- Away from regular benefits (like health insurance, retirement packages, sick leave, health saving plans, and vacation time), offer other advantages that cater to the demands of your employees specifically. Working parents may find childcare options and flexible work schedule options attractive; some might prefer sabbaticals; others might prefer gym memberships, financial incentives, and profit-sharing. Ask for the employees’ input and understand their suggestions.
Encourage feedback- Daily communication is important for employee engagement. Encourage the employees to speak their minds and offer input on your products, services, and processes. Be polite while giving feedback. Open communication helps in building trust among the employees.
Make them feel important and noticed- Indifference discourages employees. One should recognize their efforts and reward them perfectly. These rewards can range from simple thank you-notes to gifts, promotions, and financial incentives.
Keep a check in Burnout- Repeated overwork is regarded as a motivation-killer. Know the capabilities of your employees and assign them to work accordingly. Most of the employees now seek proper work-life balance. Research says that reducing stress levels in the workplace helps in improving productivity.
Hire people who will stay- How can you find candidates who are more likely to stay in your organization? There are some important indicators on the resume that you must check. First, look for people with longevity at their earlier jobs. You must look beyond things written on their resume. Try to find out if they have worked in a company for several years through ups and downs? That shows the candidate’s perseverance, loyalty, and engagement. You must also consider candidates who play team sports, who are committed to volunteer or participate in activities other than work. Candidates with these traits have the attitude to stick with something they care about.
Experts say that job hopper is just like a gamble. A candidate who had, say for example, changed ten jobs in eleven years is hard to retain for a company.
Offer guidance- Your employees must be aware of their job duties and how they are performing them. You can accomplish this by first having a job in place and offering regular feedback on the performance of an employee. If an employee feels confused about his or her role in your company, he or she probably will feel disgruntled and start exploring for something else.
Do not punish competence- Generally, managers spend most of their time on employees who face difficulty in training, neglecting the talented ones. With time, this can lead to anger as your best employees start feeling unsupported or unnoticed. Managers must praise the hard work and talent of top performers too.
Do not take yourself so seriously- As much as you try to make your company attractive to talented candidates, the reality is that employees might be leaving your organization because of their bosses. In fact, research has shown that people tend to quit their bosses, not organizations. If you can encourage an environment where employees feel rewarded and pleased, you will already be ahead of other bosses in the company.
Annual performance reviews- Even if you meet with your employees throughout the year to check how satisfied they are in their role, do not skip a big-picture discussion. This is the time when you will discuss everything including short- and long-term goals and discuss their future with the company. It is one of the important ways to improve employee retention. While you should never make promises that you cannot keep, you can talk through prospective advancement circumstances together.
Maintaining a work-life balance- One of the significant tips to improve employee retention is to make sure your company is sending the right message about the company culture. Avoid having a culture that supports and rewards around the clock availability. Expecting staff to work for long hours and attending calls is not helpful for employee retention. A healthy work-life balance plays a significant role in job satisfaction, and people must know that their bosses understand that they have lives outside the office too. Encourage staff to go on a vacation, and if late nights are required to complete a project, see if you can provide them cab facilities.
Lessen employee pain- You cannot expect employees to work like robots. When an employee’s work and life balance is hit, there is pain. If your employee feels like she is spending half of her time doing work instead of focusing on his or her personal life, then the job ultimately becomes the terrible guy. Take the example of the aviation industry. The problem that airlines face is the shortage of pilots. There ate not enough pilots to fill the airplanes, and an impending retirement wave of seasoned pilots guarantees to worsen the problem.