Among the most painful things a company can experience is high employee turnover – sometimes referred to as “revolving door syndrome.” While employee turnover likely will remain a challenge for companies, there are ways keep it under control.
The Cost of an Employee Turnover Problem
According to recent statistics from the Bureau of Labor Statistics, the national turnover average across all industries is about 20%. Some estimates place the cost of turnover at about 30% of the employee’s compensation at the time of departure. Companies must find ways to keep up with the problems created by the loss of the employee – posting jobs, sourcing applicants, interviewing, hiring, etc., all of which cost money that would not be spent if the employee stayed on board.
In addition to the costs of hiring a new employee, turnover causes lost productivity and often results in suboptimal performance due to low morale and staff re-training.
Below, we offer 4 tips to reduce employee turnover.
Tip #1: Offer Competitive Pay, Benefits and Bonuses
When determining compensation for employees, market research is a must. Find out what competitors pay their employees. Research a competitive salary range based on similar jobs in a local area.
However, compensation is about more than paychecks. Employees want good benefits, too. Learn about common employee benefits, and find out what competitors and other businesses in your area offer. Then, position yourself to attract and retain the best talent by offering competitive benefits that your employees want.
This can extend to include other benefits such as bonuses. Make them attractive and remember that not all bonuses have to be monetary – sometimes they can be about flexibility. For instance, pairing market salary along with work-at-home policies can shrink turnover as the workforce is starting to value flexibility over more pay.
Tip #2: Allow Flexible Schedules
If it’s possible, allow flexible work schedules. Flexible work schedules let employees adjust their work time and location. Employees can create a work-life balance for themselves. Your workers can pursue activities beyond work, go to personal appointments, and take care of their families.
By providing employees with autonomy in their daily tasks, you can keep your employees’ morale high and retain them without adding compensation costs to the company.
Provide employees as much freedom as possible to set their own schedule, and even choose where the location they work from. Introduce options such as work-from-home days, and flexible work hours so that it is not mandatory for them to be in-office, 8 hours, 5 days a week.
Employees can pick a work schedule that’s optimal for them but also gets work done effectively. Having the option to do this might end up as the key factor that keeps them in the organization.
Tip #3: Give Praise, Recognition and Feedback
In addition to competitive pay and creative benefits, employees need encouragement and recognition when they do something right. When employees finish a large, difficult project or submit a project before the deadline, congratulate them; recognize their hard work. Be sure to reserve that praise for accomplishments beyond everyday tasks.
The goal here is to create an encouraging, positive work environment. When employees feel respected, acknowledged, desired, and motivated, they are more likely to stay. Best of all, this method to decrease employee turnover is free. It is simply a matter of communication.
It is also important to provide both positive and critical feedback about employee progress. This should happen regularly, at least once per quarter or more. Make it a priority to schedule a short meeting to let employees know how they are doing, what you are pleased with, and give them a few things they can work on.
Tip #4: Invest in Career Growth and Development
Employees like to know that you want them to grow and succeed as professionals. You can do this by letting your employees go to conferences, hold discussion groups, encourage them to join associations, etc.
If employees remain stagnant in one job for too long, they might search for another job where they can advance. Most employees want to increase their skills and knowledge and move up the career ladder. Presenting interested employees with a projected career path gives them a sense of direction and purpose.
If the job affords the opportunity for advancement, show your employees a clear career path. Where can they go from their current position? Maybe it is an upward or lateral move; or, maybe your employees can earn more responsibility in their current position. Whatever it is, let your employees know how they can advance if that is their goal
Until Next Time, Remember…
There will always be employees who want to leave your business. They will find jobs they are more interested in, change career paths, decide to become a stay-at-home parent, or maybe start their own business. Employee turnover can’t be completely eliminated. However, you can reduce it by providing a workplace where employees want to stay.