Employers across every industry are finding it more and more difficult to retain talented employees and improve employee retention.
How many employees have you watched walk out the door in recent months? Are you among those organizations continually looking for ways to reduce a high employee turnover rate?
It doesn’t have to be that way! Let’s look at the proven strategies you can use to improve employee retention in your company.
Why Do We Have High Employee Turnover?
Voluntary employee turnover is affecting the majority of businesses much more than involuntary turnover.
A more stable economy is giving people the confidence to look for new jobs, whether it’s for higher pay and better benefits, getting away from a toxic company culture, finding a role that better fits their skills and interests, or seeking an employer who will invest in their development.
According to Gallup’s 2017 State of the American Workplace report, 19% of Americans said in 2012 that it was a good time to find a quality job. By 2016, that number had risen to 42%!
That statistic clearly shows the confidence increase in job seekers, whether they’re unemployed or looking to make a change from their current employer.
Gallup’s 2017 report also found that 51% of employees were either actively seeking new job opportunities, or at least keeping their eyes open to potentially make a change.
When HALF of your organization is a flight risk, finding ways to reduce the likelihood of your employees leaving for greener pastures becomes a top priority pretty quickly.
The Cost of Employee Turnover on Your Bottom Line
While most leaders recognize that there are widespread effects and high costs associated with employee turnover, they still may not be prioritizing investments in solutions to this challenge as highly as they should be.
Seeing the cost calculations is a tangible way to prove that investing in employee retention strategies and solutions needs to be a priority in your organization’s budget.
The Center for American Progress released a report in 2012 showing that for employees earning an annual salary of $75,000 or less, the average cost of turnover was approximately 20% of their salary. Based on the data from those case studies, replacing a single employee on a $50,000 salary costs around $10,000.
For highly skilled executives, it can be as high as 213% of their salary!
When you run the numbers, it’s clearly worth investing in efforts to improve employee retention in your organization.
The big question then becomes, “Which employee retention strategies do we need to focus on?”
The Biggest Factor in Voluntary Employee Turnover
Unfortunately, a lot of turnover happens very quickly – new employees are at the highest risk for leaving a company, before they’ve really had much of a chance to settle into their role.
One survey showed that 33% of employees knew after only a week whether they were going to stay with their new company, and 63% knew within the first month.
An organization’s culture, quality of leadership, and various investments in employees’ well-being become very apparent to new hires within their first few months on the job.
Gallup found a link between the length of time people stay in a position, and how highly they agree that they’re able to “do what they do best every day” in their work. Those that stay in a position longer are more likely to agree with that statement.
This is important because when employees consider switching jobs, the highest ranked factor is whether they have the ability to do what they do best in their current or potentially new role.
The younger a generation, the more likely they are to rank professional development as “very important” in a job (Millennials: 45%, Gen Xers: 31%, Boomers: 18%), according to Gallup’s 2017 study.
However, development isn’t all about finding people’s weaknesses and filling gaps – a key aspect of the development people are looking to their employers for is building on their strengths. Those that see themselves “doing what they do best” are the people with leaders who recognize their talents and help foster them.
Companies that want to reduce employee turnover but aren’t focused on how well they’re developing their people (in both strengths and shortcomings) are missing the biggest factor in employee retention.
Visuals pack a punch – view this free infographic to help your organization knock out high employee turnover!
Turn Training into Learning How to Learn
You may be thinking, “Well, we have an employee training program, so is that enough?”
Perhaps it is – if it’s part of a larger initiative to make continuous learning available at your employees’ fingertips.
Many traditional employee training programs have the intention of facilitating continuous learning, but they’re simply not up to the task if they’re limited by outdated technology or only pushing out mandatory training.
In the 2016 Global Human Capital Trends report, Deloitte researchers stated:
“…the most fundamental [shift] for HR to make is to think of learning from the perspective of a user’s daily experiences and career aspirations, rather than as a series of processes and programs that the learning function wants to roll out.”
Developing your people into strong team players who understand their current and potential value to the organization means providing resources and encouraging a culture that cultivates learning how to learn.
In other words, put your employees in the driver’s seat of their own professional development. Give the people what they want!
How to Improve Employee Retention with Modern Learning Solutions
One BizLibrary client, Integrated Manufacturing and Assembly (IMA), realized the benefits of shifting training to a more self-directed, elective focus, and after doing so, they saw a 15% reduction in their employee turnover rate and saved $130,000 in recruiting costs!
IMA’s improved employee retention goes hand-in-hand with a culture shift from low morale to one of employees being excited and appreciative of the investment IMA has made in their development.
Hear from IMA’s Learning & Development Director, Andrea Jones, how they used online learning to help improve employee retention and save money:
To become a high performing learning organization that attracts and keeps talented individuals, Deloitte researchers stated in their 2016 report:
“Use technology to drive employee-centric learning: Mobile, social, and web-based platforms that can deliver on-demand learning content are “must-have” capabilities.
“The best systems can easily integrate any type of digital content and allow learners, as well as learning professionals and business managers, to add and suggest content.
“Companies should be cautious before investing in massive new systems, and they should monitor developments from innovative vendors to help build effective learning applications.”
Your organization can significantly reduce the number of talented employees who are looking for opportunities elsewhere when you prioritize investing in their professional development, their way.