We’re living and working in an entirely different world than we were just two years ago. The Great Resignation, or the “Big Quit,” has received a great deal of attention in the media and throughout the world. Roughly 33 million Americans have quit their jobs since the spring of 2021. Some are older workers who decided to retire early. Some are secondary wage earners who have stayed home to care for their children. Most Americans, however, are not quitting the workplace but are quitting their current jobs, companies, or managers. Given the large number of open jobs (at last count, nearly 11 million), they are looking for greener pastures that include better pay, perks, flexibility, and treatment. And they hold all the power right now.
Employee retention should always be a priority, but it has now become the most important one for keeping top talent. Turnover is very costly, with the Society for Human Resources Management (SHRM) estimating that it costs anywhere from $20,000 to $30,000 in recruiting and training expenses to replace a manager making $40,000 per year. Not only that, but high turnover impacts employee motivation, productivity, and performance. The stakes are very high for retaining employees.
What are some of the best strategies that will improve overall retention? Let’s explore five approaches:
- Employee engagement. Recent studies indicate that only 21% of employees say that they are very engaged in their jobs, and the cost of low engagement is estimated at more than $450 billion per year in lost productivity. One of the best ways to improve engagement is to provide everyone with a “voice.” This doesn’t mean they have a vote, but it does mean that they have the ability to make their opinions and suggestions known. Asking for feedback is one of the best ways to start engaging your employees. And responding to and acting on their feedback is just as important as getting it.
- Effective hiring. Attracting the right candidates to your company will go a long way in retaining them. Every organization has a unique culture that must be aligned with future employees. In addition to matching candidates to culture, the hiring process must be very transparent to the candidates under consideration. What seem to be great hiring decisions often fall apart quickly when the candidate is not provided full disclosure about the company, its leadership, values, goals, and work environment. Failing to make this information clear results in the new employee quickly realizing that what they thought they knew about their new employer turned out to be wrong.
- Exceptional onboarding. It is important to help a new employee transition from an “outsider” to an “insider” as quickly as possible. This is accomplished by helping them understand what their responsibilities are, providing them with the resources necessary for them to successfully complete their roles, and creating a supportive environment where they feel fully accepted.
- Professional development. Educating employees, establishing clear career paths, and creating coaching programs ensures that everyone has the opportunity to reach their full potential. In addition to internal training programs, why not consider continuing education reimbursement and certification programs? Finally, offering internal support programs that connect employees from many different parts of the organization can provide ways for employees to encourage and teach each other new skills.
- Manage retention. It is often said that “Employees don’t quit companies, they quit managers.” Statistics reveal that over half of all employees that leave their employer because of a “bad” manager. Effective managers aren’t there to tell people what to do, but rather, to act as coaches and focus on getting the very best results from their direct reports. They are optimistic, assertive, recognize good performance, and give actionable feedback.
Implementing these five strategies may seem overwhelming, but improving employee retention is well worth the effort. By creating open communication channels and building a culture of recognition and improvement, along with the other techniques discussed here, retention can be improved not only in the present, but well into the future.