Employee retention is the ability of a company to keep an employee. Reducing the rate of employee turnover is a major business advantage because hiring and onboarding new employees costs time and money. Adjusting and adapting the system to change can be very demanding and costly.
It should be the goal of every business to reduce the rate of employee turnover. This article will discuss several ways to improve job satisfaction and ultimately employee retention.
The Importance of Employee Retention
A lot is involved in finding, hiring, training, and onboarding new employees, including:
- Posting a vacancy on job sites
- Scanning through a lot of resumes
- Going through several hours of interviewing
- Onboarding new hires
The entire process takes time. It also gulps a lot of money. The orientation and onboarding process can lead to loss of productivity since new hires have to learn their new job and get acquainted with team members and established processes.
Losing employees — especially those who have been around for a long time — also means losing your investment in them. In a worst-case scenario, you could even lose them to a competitor.
However, many of these issues can be mitigated by attempting to keep your top talent.
8 Employee Retention Strategies to Reduce Employee Turnover
It's every employee's dream to find a job that uses their experience, values their contribution, and empowers them. Therefore, your goal should be to make your employees feel motivated, appreciated, and empowered. This can reduce employee turnover, make more employees stay for the maximum time, and allow them to contribute effectively.
According to Forbes, an employee leaving can cause significant disruption in a company's operations, especially if the lost talent was a high-performing team member. Filling in the position they left vacant can take months. So, employee retention is worth the energy and commitment.
Below are a few employee retention strategies you should implement in your organization.
Hiring Fitting Employees
Every house relies on the strength of its foundation. It's the same with employee retention. Hiring employees who don't fit is one major cause of a high employee turnover rate. So, your first step to ensure employee retention is to find employees who fit into your company culture.
Hiring fitting employees may require that you:
- Define your company culture clearly.
- Outline the job description and qualifications in clear and lucid terms.
- Ask relevant questions to understand whether your values align with the potential employee. Ask them questions about their career goals and plans.
- Do a thorough background check to know why they left or are leaving their previous/current employer.
You can't be too careful when hiring an employee because the cost of them leaving and hiring someone to replace them can be a significant burden to your company's finances.
Always Listen and Respond Promptly to Employee Requests/Complaints
Employee complaints are inevitable because humans — even at their very best — are still imperfect. Listening to employees and responding promptly to issues they consider important is an effective human resource management approach. Effective communication between management and team members can be a very strategic way to strengthen employer-employee relationships. It can improve employee satisfaction and sustain their morale within the work environment.
Create an open-door policy where employees can easily air their grievances. Then, have your human resources/conflict resolution personnel act on employee complaints as quickly as possible.
Provide a Clean, Comfortable, and Safe Work Environment
Regardless of the size or nature of the business, employers should have procedures and protocols in place to ensure the safety and comfortability of every employee. If employees know their work environment is safe and clean, they'll feel more comfortable coming into the workplace. Employees will focus better on their work because they know the business is prioritizing their safety.
Recognize and Praise Employees When They Go Above and Beyond
Employee recognition shows that you value the hard work and contribution of your employees. Part of valuing an employee is to recognize and praise them for their contribution to the growth of your company.
A simple commendation letter can make them feel appreciated. You can also give thoughtful gifts to well-performing employees and top talents. These gestures can also help increase employee engagement, as employees will typically be more responsive after receiving recognition.
Provide the Materials Employees Need to Do Their Best Work
If employees don't have the proper materials to do their work effectively, they may eventually get discouraged and look for opportunities elsewhere. Lack of proper resources may convey to them they aren't a priority.
By supplying employees with sufficient resources, you not only show that you care about them, but they'll also deliver higher-quality deliverables. When employees know that management will supply them with whatever they need, they'll be more likely to stick around because they feel supported.
Offer Flexibility That Caters to Employees' Lives and Needs
Work flexibility is usually a mutual agreement that exists between the employer and employee regarding where and when employees should work — their work schedule. By offering flexibility to employees, you help promote a healthy work-life balance, showing that you care about their physical and mental health. This also helps prevent burnout, which can lead to employees seeking work elsewhere.
Freelancing is a good example of flexible work; however, traditional employers have embraced a flexible work approach — in part, because of the COVID-19 pandemic. Depending on your business, you might be able to offer remote work.
Give Employees the Opportunity to Learn and Grow
The human desire for growth is one of its strongest desires, so an employee can be demotivated by the lack of growth. Ongoing professional development doesn't have to be a tremendous investment and can bring many benefits to your workplace and team.
Here are some benefits you get when you invest in creating development opportunities for employees:
- Improved employee satisfaction.
- Employees can explore the advancement of their careers.
- Attract and keep top talent.
- Breed loyalty.
- Increased employee engagement and productivity.
You can help your employees grow by:
- Organizing regular on-the-job training
- Encouraging employees to embrace career advancement and professional development programs
- Recognizing employee achievements, such as learning new skills, getting a new degree, or gaining professional certification
Offer Competitive Pay and Additional Perks
Competitive pay is when an employer offers an employee a salary that equals or exceeds what others within the industry or geographical area can offer. This is usually done to beat other companies in securing the services of high-quality employees.
In most cases, employees consider their salary to be a major incentive to be diligent. So, if an employee considers themselves to be underpaid compared to another employee who does less work, they may look for a new job. Employees who are paid competitive salaries are more likely to be motivated to continue with their current employer.
You can offer competitive pay by considering the following:
- Employee experience and skills
- Worker level
- Supply and demand
- Geographical location
Aside from an employee's annual salary, you can also offer a few perks and allowances, such as paid time off and health care benefits.
Keep Your Business Finances on Track With Skynova
One way to prevent employee turnover and having to hire and onboard new hires is to invest in employee retention strategies. Besides having happier employees, you'll also save money on onboarding and training.
Similarly, you can further keep your business finances in shape by tracking your income and expenses. Skynova makes expense tracking easy with 37 software modules designed to meet the accounting needs of small businesses like yours.
Invest in Skynova's accounting software so that you can invest in retaining employees and growing your business.
Notice to the Reader
The content within this article is a general guide and may not apply to your specific situation. Always consult with a human resources professional to ensure you're meeting workplace standards.