Employee Retention: Effective Strategies to Implement to Keep Top Talent
Is your industry seeing a high rate of turnover?
If so, you may need to reassess your employee retention tactics.
You already know you’ll have to rely on your remaining team members to shoulder greater responsibilities while you look to fill those open roles. That’s a hefty task, especially if they’re already overworked, and it might add to their stress and anxiety.
Employee retention is quickly becoming a significant factor in the marketplace. The capacity of a firm to retain its people — particularly in tight employment markets — has important implications for its ability to function at a high level without the interruptions that employee turnover causes.
Now is the moment to double-check that your company is doing everything it can to boost work happiness and develop effective strategies for how to retain employees.
What is Employee Retention?
Employee retention refers to a company’s tactics and processes to maintain its best employees and reduce turnover risk. Employee retention and turnover are significant workforce management concerns for many businesses and HR professionals, resulting in considerable operating expenses and jeopardizing their ability to develop and profit.
According to the U.S. Bureau of Labor Statistics, average employee turnover rates vary by industry, ranging from less than 20% in public sector jobs to more than 60% in professional services and construction. For example, retail, restaurants, and hospitality are particularly vulnerable to high attrition since they employ numerous first-time, part-time, seasonal, and student workers.
Exit interviews may provide you significant insight into your company’s employee viewpoint and help you figure out whether your staff retention methods need to be tweaked.
The departing employee will most likely claim one or more of the following reasons for quitting their job:
- Inadequate remuneration and perks
- Feeling overworked or unsupported
- Career progression chances are limited
- Poor work-life balance
- Lack of acknowledgment
- Worries about the company’s direction or financial health
- Issues with management or company’s culture
The Benefits of Talent Retention
Employee retention is about more than just limiting the amount of harm to the company when people depart. It also provides an opportunity to boost company performance in a variety of crucial areas. Here are some ways that good staff retention strategies and practices help businesses.
Every year, large companies in the United States spend billions on identifying and hiring replacement labor. Advertising, interviewing, and screening are all included in the costs. Onboarding costs, including training and management monitoring, mount quickly.
Improvements in Morale
A rotating door environment can harm employee morale. Employees who stay may have to take on larger workloads or obligations, in addition to losing relationships.
The infectious nature of turnover is also troubling. Employees may decide to leave because they observe others looking for work or discussing resigning.
Successful employee retention strategies can boost employee morale, increase connectivity and engagement, and spread supportive sentiments throughout the organization.
The loss of institutional knowledge, skills, and connections — both inside the company and with customers and partners — that occur when a person leaves is one of the most devastating costs of excessive turnover. The organization also loses the opportunity cost of the potential value the employee may have contributed. When senior staff leaves, it can influence succession planning.
Organizations that place a premium on keeping more senior or experienced staff reap huge rewards because they are more likely to solve complicated problems independently, which helps the company.
Efficiency in Recruiting and Training
Replacing an employee comes with a steep price tag in the form of training and onboarding. All of that money is wasted if a new hire leaves.
Recruiting expenses may be drastically lowered by concentrating on staff retention. Another option is to look for candidates from within the company. The cost of internally training and reskilling an employee may save a company tens of thousands of dollars per worker.
Employers face a slew of problems as a result of high turnover. The most apparent effect is a decrease in productivity. On average, it takes a new hire one to two years to catch up to a current employee’s productivity. New hires also require time to establish connections with coworkers and customers.
Effective employee retention might save a company from losing productivity. Workplaces with a high retention rate tend to have more engaged employees who, in turn, get more done.
Improved Customer Service
From the initial encounter through post-sale assistance, a consumer’s perspective or opinion of their contacts with a firm is referred to as customer experience.
This is where a high level of turnover might be detrimental. New workers, for example, may take longer to complete tasks, be less skilled at problem-solving, and be more prone to customer service errors, all of which can negatively impact the customer experience. Customers may then share their unpleasant experiences with others, jeopardizing the company’s image. On the other hand, satisfied employees have stronger morale and competencies, which show while dealing with clients.
Better Corporate Culture
A company’s corporate culture is formed by its employees’ attitudes, tastes, and actions, and it plays an unquestionable role in attracting and maintaining the best employees. When one employee departs, others may wonder why they left and begin to doubt their own commitment to the company. When engaged individuals who are aligned with a business’s culture stay, the ethos and atmosphere of the organization are strengthened.
Enhanced Employee Experience
An employee’s view of their interactions inside an organization — from when they first applied for a job to when they left — is their employee experience. It also considers each individual’s interactions with coworkers, bosses, and customers. A good staff experience may boost productivity and encourage more positive customer interactions, increasing customer loyalty.
Reduced employment expenses, increased efficiency, and the delivery of superior customer experiences, among other things, all contribute to increased revenue. Tracking revenue growth due to retention policies may be a useful HR statistic for demonstrating the programs’ return on investment.
Improved Employee Satisfaction and Engagement
Employee engagement, defined as a person’s level of connection and devotion to their work and business, may be boosted through a great employee experience. Employees who are engaged are more likely to remain with the organization because they are driven and care about their work and company.
Staff happiness, morale, and employee engagement are all critical factors in an organization’s success. An extra benefit is that engaged employees are more likely to become brand ambassadors, spreading favorable messages about their company to their networks.
A comprehensive workforce planning tactic must include an effective employee retention strategy. Focusing on staff retention pays well for the entire company.
How to Improve Employee Retention
Employee retention planning is about creating tactics that keep employees engaged and focused so they choose to remain with the company and contribute fully to its success. A robust employee retention program may help you recruit and keep essential personnel while lowering turnover and its associated expenses. It is more cost-effective to keep a good employee than to find, train, and position a new one of the same caliber. All of these factors contribute to a company’s productivity and overall success.
Developing a successful retention management strategy involves substantial effort, senior oversight, and focused investment. Still, it pays off for companies that apply the strategies, tools, and procedures needed to keep their best and brightest employees.
Employee Retention Strategies & Ideas
While the employment market may vary in particular industries and places, high-profile talent will likely not have to send out too many resumes. After all, while many businesses continued recruiting during the pandemic, those which did are beginning again.
If you’re worried your company may lose key employees, you should act quickly toward improving employee retention tactics. Here are 14 employee retention ideas to consider:
1. Start During the Hiring Stage
Retention begins with the application process and continues through the screening of applications and selecting candidates for interviews. It’s an increasing returns model, which means that the longer someone works for you, the more effective they become.
2. Select New Hires that Share Similar Values with the Company
Employees that are connected with the organization’s values, vision, and mission tend to remain longer, so recognizing them throughout the recruitment process can pay off in the long run in terms of retention.
3. Orientation and Onboarding
From the beginning, each new hire should be set up for success. Your new employee onboarding process should teach them about the work, the corporate culture, and how they can contribute to and flourish within it. Orientation and onboarding are crucial initial steps that you should not overlook.
4. Offer Mentorship
In a remote work environment, pairing a new employee with a mentor is a terrific addition to your extended onboarding process. Mentors may help newcomers get acclimated to the organization, provide assistance, and act as a sounding board. It’s also a win-win situation: new team members learn the ropes from seasoned personnel while providing their mentors with a fresh perspective.
Mentorship opportunities should not, however, be limited to new staff. Mentor-mentee connections may considerably help your existing personnel, as well as your general employee retention outlook and team’s job happiness.
5. Ongoing Performance Evaluations
In lieu of more regular interactions with team members, many companies are ditching the yearly performance review. Talk to your workers about their short and long-term professional objectives in these one-on-one conversations, and help them envision their future with the firm.
6. Clearly Defined Paths to Success
Promoting from inside not only gives employees a clear route to higher pay and responsibilities, but it also makes them feel appreciated and essential to the company’s success. As a result, personnel training and development are critical. Discuss possible job progression situations with your employee and devise a realistic plan for achieving their objectives.
7. Development and Training
You may assist employees in identifying areas for professional progress, such as the need to learn new skills, as part of delivering continual performance evaluation. As technology continues to revolutionize how we work, upskilling is more necessary than ever. As company requirements continue to grow, workers upskill to learn new talents and capabilities. Make investing in your employees’ professional growth a top priority.
8. Compensation Packages
Companies must pay their employees competitive remuneration, which implies that salaries must be evaluated and adjusted regularly. Even if your company cannot boost salary at this time, consider providing alternative types of compensation, such as bonuses. Don’t forget to improve healthcare benefits and retirement programs since these can also assist boost employee happiness.
9. Encourage Employee Innovativeness
Although many businesses claim to embrace innovation, they may not have any programs or policies in place to assist it. If you want to set your company above the rest, consider programs that:
Offer incentives: If you want to encourage others to make recommendations, you should take them seriously. Employees that make a tangible contribution should be recognized and rewarded.
Provide an outlet: Not all workers will want their ideas to be named or appreciated. Managers should provide chances for both public and private comments or suggestions.
Set up innovation teams: These are small groups tasked with developing creative solutions to a specific problem.
10. Perks and Benefits
Perks may help your company stand out to prospective new workers and re-engage current employees, all while improving morale. The benefits that many professionals cherish the most include flexible scheduling and remote work choices (as opposed to pandemic-related stay-at-home directives).
11. Wellness Services
It’s smart business to keep staff well — mentally, physically, and financially. Many major firms have expanded their wellness programs in response to the pandemic, allowing workers to feel valued and like their well-being was prioritized. Employee stress and coping programs, retirement planning assistance, and fitness class reimbursement are just a few examples of what your company may provide. To gain the edge over your competitors, you will also want to provide superior health benefits, such as on-site healthcare.
12. Encourage Workplace Respect
People now, more than ever, want to be treated with respect at work. They don’t want to feel undervalued or inconsequential in the workplace, which may occur when there is a lack of respect. Many of the tactics listed on this list, including review, acknowledgment, fostering innovation, cooperation, and so on, can help develop a culture of respect.
13. Work-life Balance
Job happiness requires a healthy work-life balance. People need to know that their bosses realize that they have lives outside of work and that maintaining a work-life balance is considerably more difficult while working from home. Employees should be encouraged to set limits and use vacation time.
14. Foster Change Management
Aside from the pandemic’s interruption, every workplace must face change, both good and negative. During difficult moments, employees look to management for guidance and confidence. If your company is going through a significant transition, keeping your employees as informed as possible may help alleviate fears and control the rumor mill. Make major announcements on your own or in a group call or meeting, and provide time for questioning.
Give Your Employees a Life-Changing Health Experience
The necessity of providing health insurance to employees impacts management in charge of hiring, employee retention, and managing personnel as organizations react and recover from interruptions like the COVID-19 pandemic. Eden Health offers a single platform to fulfill your workers’ medical needs, providing them with a team of medical physicians, mental health specialists, and insurance experts. Learn more about our employee health solutions and how we can help your company save money on medical costs.