From small businesses to major corporations, the so-called Great Resignation is hitting companies hard. Despite the ravages of COVID-19, a record 4.3 million Americans quit their jobs in August, leaving 10.4 million jobs open, and mid-career employees are leading the exodus.
The result? A highly competitive jobs market in which many companies are struggling to retain employees and attract new talent. Data suggests this trend isn’t slowing down, either. In fact, recent figures show that more than 4 in 10 workers are considering quitting their current jobs, given in part by the availability of positions and new opportunities opened by the shift to remote work.
Why Employee Retention Is Important
The impacts of employee turnover go far beyond temporary disruptions. For one, it’s costly. Replacing an employee costs roughly one-third of their annual salary, according to the Work Institute. And the Houston Chronicle reports that, in addition to those costs, high turnover also impacts the staff that remains—and the business’s customers.
As employees watch their colleagues leave, their workloads often increase. This can lead to a downward spiral of departures and stress. Frustrated, overworked employees are less likely to perform at their peak, meaning the company’s product or service suffers, and customers have more negative interactions with the company. The ramifications are difficult to fully quantify.
Techniques for Employee Retention
So how can companies keep employees happy and prevent them from looking for new opportunities elsewhere? These six strategies for employee retention at your company will put you on the right path.
1. Invest In Employees’ Careers
According to LinkedIn, 94% of employees say they would stay with their company longer if it invested in their career development. In today’s economy, employees understand that they need to keep their skills sharp to remain competitive and move up the ladder.
Organizations can tap into their employees’ desire for development by providing structures like mentorship programs and investing in additional education for their employees. Online professional education courses like those Emeritus offers help organizations reskill and upskill their employees, growing their talent base while increasing employee satisfaction.
2. Focus on Managers
Have you ever heard the old line “people don’t quit jobs, they quit bosses”? Well, sometimes it’s true. A 2019 study found that 57% of employees have quit a job because of a poor relationship with their manager. Fortunately, leadership skills can be trained. Companies should ensure performance reviews take management skills into account and offer training and mentorship to managers at all levels, especially if they are first-time supervisors.
3. Recognize Employees’ Contributions
Everyone likes to feel valued, and that’s especially true in the workplace. In a Society for Human Resource Management survey, 68% of HR professionals said that recognition was important for retention, yet many organizations lack formal recognition programs.
Companies should encourage managers to recognize their direct reports’ work. They can also go further to offer division- or company-wide recognition of staff who go the extra mile. During the pandemic, when many employees have been forced to manage difficult circumstances amid ever-changing conditions, that recognition is especially important.
4. Reassess Compensation
In today’s competitive marketplace, compensation is an essential piece of any company’s retention strategy. No matter how valued an employee may feel, they are likely to look outside their current company if they feel inadequately compensated for their work. Companies that provide transparency around their pay and a clear, simple pay policy are more likely to win over employees, according to Monster.
Regular reassessment of industry compensation standards is important, as is a strategy to financially reward top performers. Spot bonuses and regular wage increases can go a long way toward making an employee feel valued.
5. Consider Your Benefits Package
Similarly, benefits are a major factor, with Forbes reporting that for nearly 6 in 10 employees, a company’s benefits package is the most important non-salary factor they consider when assessing a job. Benefits like lower employee healthcare premiums or increased parental leave can mean the difference between staying in a role or looking for a new one.
Even before COVID-19, flexible workplaces were a major driver of retention. Companies can expect that their willingness to accommodate employees’ needs and preferences will remain a major factor in employee loyalty.
6. Prioritize Work-Life Balance
Work-life balance isn’t just a buzzword. While remote work and flexible scheduling policies are important factors in creating work-life balance, they are of little use if employees simply have more work to do than they can reasonably achieve, or if the company culture expects them to check their email well after business hours.
Managers should regularly check in with employees to ensure they don’t have more on their plates than they can handle and to encourage open lines of communication about workloads. Moreover, organizations can reduce the crunch by cutting back on unnecessary meetings and administrative duties that drain time without adding significant value. Ultimately, companies should weigh the cost of adding staff against the cost of increased turnover if workloads become unsustainable.
Implementing Strategies for Employee Retention
In today’s tight labor market, the importance of employee retention strategies can’t be overstated. Since a few employees leaving the organization can quickly lead to lost morale and unmanageable workloads, it’s essential to be proactive by implementing effective employee retention strategies such as compensation reviews, recognition programs, and opportunities for upskilling and reskilling.
Employees who feel valued and believe that their companies are invested in their success will be happier, more productive, and more loyal—a win for everyone.
Interested in leveraging upskilling and reskilling as one of your strategies for employee retention? Schedule a meeting to learn about partnering with Emeritus to develop online programs taught by leading professors and experts in their fields.
By Rachel Hastings