Amidst ever-rising inflation and the ongoing Covid-induced ‘Great Resignation,’ today’s job market is cutthroat—only those companies willing to adapt are likely to survive. Growing employee shortages are inevitable in this new workforce landscape. Employees hold more bargaining power than ever and employers need to step up and implement meaningful retention strategies.
Now more than ever, the employee retention strategies you institute (or ignore) will define your business in the months and years to come.
Why employee retention is important
According to Gartner, annual voluntary turnover among US employees is likely to jump nearly 20% this year—from a pre-pandemic annual average of 31.9 million employees to a stunning 37.4 million quitting their jobs in 2022.
Particularly when top talent heads for the door, it plays on the morale of your entire team—not just because they need to pick up the slack, which can be exhausting, but because good people leaving sends a message. Plus, the thing about resignations is that they tend to have a domino effect.
Not to mention, it’s estimated that the actual cost of employee turnover ranges between 100% and 300% of a departed employee’s yearly salary.
The good news is this: an effective employee retention strategy can go a long way toward boosting employee morale, satisfaction and loyalty. Which in turn, prevents turnover and circumvents unnecessary costs and roadblocks to growth. It should go without saying that all of the above is great for business.
Why employees leave
Employee exit interviews can provide a critical glimpse into employee perspectives, as well as invaluable insight into where you should focus improvements, and which retention strategies you might consider pursuing.
Chances are you’ll hear resigning employees offer one or more of the following reasons for leaving:
- Burnout and an accompanying lack of support
- Limited or zero opportunities for career growth
- A disregard for work-life balance
- Little to no acknowledgement of successes
- Boredom and/or lack of stimulation, new challenges
- Distrust/disapproval of management strategies
- Concerns about the financial viability or overall direction of the company (and their future in it)
- Unhappiness with the company culture (or lack thereof)
- The need to make significant changes in their life
How to retain your top talent
Unsurprisingly, some of the most practical strategies you can implement to help retain your most valuable employees are those that directly address employees’ reasons for leaving.
1. Don’t skimp on onboarding
Onboarding may seem far removed from resignation, but it’s really not. Many companies drastically underestimate the need for a quality onboarding process, and it shows.
The reality is, turnover during the first 18 months on a job can be as high as 50%, but 69% of employees are more likely to stay with a company for 3 years if onboarding is a positive experience.
Think of onboarding as an opportunity to set each and every one of your employees up for lasting success—a chance to teach new hires about the job, the company culture, and their potential within it. The training and support you provide—from the pre-boarding phase on—will set the tone for the employee’s entire tenure at your company.
2. Get feedback…and give it too
Feedback is a cornerstone of strong communication, and communication is crucial to your company’s success.
You might solicit employee feedback by doing company-wide surveys or organizing focus groups in order to gain a better understanding of employee needs and feelings. Once the results are in, be sure to communicate clearly and transparently what the next steps are—if you do the surveys and never speak of them again, employees will feel you’re not taking it seriously.
And while getting input from employees is key, giving feedback is just as important. In fact, it’s crucial to a productive workplace. Institute a continuous feedback loop into your company culture via performance reviews, one-on-ones, peer surveys, and more. Don’t be afraid to get creative.
If you’re overwhelmed, PurelyHR’s Performance module offers a fantastic 360 degree feedback tool—the perfect continuous feedback starter kit.
3. Revamp employee benefits
While increasing salaries is always a plus to your retention efforts, we understand you may not have the budget. And according to Glassdoor, 80% of employees place even more value on meaningful benefits.
If you’re wondering whether employee benefits are really worth it, they are. It’s hardly news that work-life balance and mental health are at the heart of what many employees are seeking. A strong benefits program can help you attract and retain the best employees, and set you apart from the competition.
If you have a small business and a tight budget, all you need to do is get creative. You could have outdoor meetings for more fresh air, get some lush plant life in the office, or offer more flexible work arrangements (think hybrid or remote).
You might set up mentorship opportunities, provide development funds, offer mental health days, parental leave, or the option of a 4-day work week. Do what you can to offer more meaningful benefits—the kind that will make employees want to stay put.
4. Take professional development seriously
About 90% of millennials say they value opportunities to learn new skills and grow in their careers.
Investing in employee professional development is worth it and should be a top priority. Companies that provide career growth opportunities retain their employees for longer and stand out, even in a competitive market.
In the spirit of continuous feedback, you might help employees identify areas they’d like to target for professional growth. After all, upskilling is necessary to staying current in our workforce with constantly evolving technology.
You might also allot time for them to attend conferences (whether virtual or in-person), or provide funds for continued training or education. Succession planning too, can be an incredibly effective way of advancing professional development and boosting leadership skills.
Finally, you might encourage mentorship by pairing newer employees with seasoned staff to facilitate the transfer of knowledge.
5. Cultivate work-life balance
Work-life balance is not just a buzzword—it’s essential to job satisfaction. Your employees need to feel that you respect the fact that they have non-work lives.
While our remote work is becoming the modern world of work, never being fully unplugged can sometimes feel like a cruel and unusual punishment. The chronic stress epidemic is a clear result. Global data gathered by the Harvard Business Review reveals that 89% of employees are reporting a worsening work-life balance, and 85% are reporting declining wellbeing.
When it comes to work-life balance, a little self-reflection can go a long way. What message is your time management style sending? Do you expect employees to be available outside of agreed upon work hours? Are you yourself feeling burnout?
Try setting a positive example by making changes in your own life. Encourage staff to set boundaries and take their vacation time—and do the same for yourself. If late nights are necessary to meet a particular deadline, consider giving your team extra time off once it’s done.
Bonus tip
When all is said and done, taking the time to recognize your most vital asset (your people) for all the good work they do may just be the most central underpinning of your entire employee retention strategy.
Shine a light on notable achievements. Celebrate victories, big or small. And commemorate work anniversaries or other important milestones. Really, what better way is there to build a tight-knit community?