Top 6 Employee Retention Strategies for Your Business

What is Employee Retention?

Employee retention is the art and science of keeping your employee satisfaction levels high enough to keep the turnover rate and recruitment costs low.

Although one article can’t cover all the possible strategies for boosting employee retention, we’ll cover six of the top employee retention strategies here. 

When you’re ready to dig deeper, Simplilearn provides corporate training in employee retention (and in many other areas) through a blend of online learning, live virtual classroom training, mentorship, and labs.   

Why Do Employees Resign?

When it comes to retaining employees, it’s essential to understand common reasons that spur them to leave in the first place. Then you can take measures to prevent those problems at your company.

No Progression

People don’t like to stagnate. They’re willing to take entry-level jobs, but that doesn’t mean they’re willing to stay there. If a person doesn’t receive well-deserved promotions and opportunities for career acceleration at your organization, he or she will look elsewhere to receive them.

Poor Leadership

In January 2020, Career Addict surveyed employees who had voluntarily left their jobs for other work. 40 percent of those surveyed indicated that they’d return to their former place of employment if their previous boss were replaced. 

Management issues such as discrimination, micro-management, lack of empathy, and inflexibility often sabotage employee retention.

Poor Benefits

One surefire way to negate your employee retention strategy is to offer lackluster benefits. Enticing benefits are sometimes more important to people than the paycheck itself, and these can include: 

• Medical
• Dental
• Vision insurance
• Paid time off
• Paid holidays
• Gym memberships
• Flexible hours/locations
• Childcare options 

As you might expect, prospective employees will undoubtedly be willing to entertain offers from your competitors for the same pay if those competitors offer better benefits. 

Hostile Work Environment

A work environment can cover anything from physical facilities to relationships among colleagues. A hostile work environment is one of the foremost problems that push good people out of an organization’s door, whether hostility is due to an uncomfortable atmosphere, unsafe surroundings, unpleasant people, or any combination. 

Low Pay

It may surprise you to hear that a bigger paycheck is not the number one reason for people leaving their place of employment. This reason does make a list, indicating that while money isn’t everything, it still matters. 

Employers who aren’t willing to pay competitive market prices will struggle to attract top talent. They’ll also struggle with employee retention because their people will be willing to look over the fence when recruiters from companies with better pay and benefits come calling.

How Can We Improve Employee Retention?

The best employee retention strategies will address the biggest employee retention problems. Here are six ways to do it.

1. Provide Opportunities for Advancement

According to the Consumer Technology Association (CTA), skills training and professional development programs are two of the top ways of retaining employees. This is because employees see those programs as a company’s investment in their future and an indication that they’re being honed for promotional opportunities. 

Wherever possible, companies who wish to retain their employees should consider hiring and promoting from within.

2. Provide Effective Management Training

Some people are good at organizing and managing logistical affairs, but they’re not necessarily natural leaders. However, true leadership can be a learned skill. Train your managers to be empathetic, flexible, reasonable, transparent, and cooperative, and they’ll add those skills to their already formidable business knowledge. In turn, these managers will inspire great work and loyalty in others.

3. Reach the Millennial Generation

Engaging and retaining Millennials has become more important than ever when it comes to mitigating the costs of employee turnover. But how do you do this? 

The engagement drivers within your organization should be identified and monitored, as these can change over time. Targets and goals for your engagement strategy should be carefully crafted to account for the modern ambitions of Millennials. 

You can do this through a routine monitoring process and surveys. Transparency is also essential to this generation. As Millennials believe in continuous learning and self-development, it’s also imperative that you offer opportunities to reskill and upskill themselves whenever possible.

4. Offer the Best Benefits You Can Afford

Sure, benefits packages can be expensive. However, when you offset those expenses against the cost of high turnover, you’ll see that you can’t afford not to offer attractive benefits. Do your research and find the best package you can afford, and the resulting employee retention will be worth your investment.

5. Listen to Employees and Implement Their Suggestions

Another key element of any effective employee retention strategy is to get reliable feedback from your employees to see how they’re feeling about their jobs and their work environment. Talk to them. Listen to them. Conduct surveys (formal and informal) and evaluations to see if they’re comfortable in their physical environment and get along with colleagues and supervisors. Then, internalize and implement any reasonable suggestions they make, so everyone feels heard and valued. Steve Olenski, the former contributor to Forbes online, reminds you to “always put your people first.”  

6. Do Market Research to Offer a Competitive Wage

A crucial element of retaining employees is knowing what your competitors pay similar talent. Is your pay for above average in the industry? Do your market research and stay competitive. 

As Robert Half asserts, “Quite simply, companies that don’t offer competitive pay packets can put themselves out of contention when it comes to sourcing [and keeping] top talent.”

Why Are Workers Leaving?

Exit interviews can give you invaluable insight into your employees' perceptions of your company and assist you in determining whether you need to strengthen your employee retention strategies. 

• Insufficient pay 
• A non-competitive perks and benefits package
• A sense of being overworked or under-supported
• Little progress in the workplace
• A greater work-life balance is required
• Lack of acknowledgment
• Boredom
• Dissatisfaction with management
• Concerns about the company's future or financial situation
• Unhappiness with the corporate culture
• The motivation to change
• Other organizations may have more interesting career possibilities

Why Employee Retention is Important?

In order for employees to develop a sense of trust and dependability among one another, employee retention is crucial to team development and cohesion in the workplace.

When talented employees leave an organization, one of the biggest losses is diminished production and loss of competitive advantage. High personnel turnover rates can hinder an organization's ability to carry out its mission due to impairments to continuity, loss of institutional knowledge, and high expenses of replacing departing workers and training new replacements. Employee departures can also weaken morale and lead more employees to leave the firm.

The influence on clients who discover they're dealing with a constant stream of different individuals is another unfavorable consequence of turnover. Consumers are frequently alerted by high turnover that there is a problem with the company or brand.

Ultimate Guide to Recruitment and Talent Acquisition

Worker recruitment is as old as commerce itself. Businesses have long had methods for finding and attracting personnel, determining whether they are fit, agreeing on remuneration, and finally hiring and integrating them into the organization.

However, this age-old field has undergone fundamental upheaval due to rapid technological improvements and the disruptive power of a worldwide pandemic. In addition to being largely computerized today, the talent pool is also global because of COVID-19's transition to remote labor. Companies can quickly assess the qualifications of applicants thanks to AI tools.

Business Benefits of Employee Retention

In order to keep valued employees and retain a strong employer-employee relationship, one of the most crucial methods is to focus on employee engagement and experience. A few noteworthy commercial advantages are as follows:

Better Process Efficiency

Longer-term employees have institutional knowledge they can depend on and are familiar with the firm's procedures, which increases job efficiency and speeds up the achievement of company objectives.

Greater Worker Productivity

Experienced workers are frequently adept at doing their responsibilities swiftly and effectively. On the other hand, bringing on fresh substitutes frequently results in workflow delays and unavoidable, expensive blunders.

Higher Employee Morale

When employees feel like they belong in the company, they are more likely to have higher morale, take pride in their work, and perform better. The opposite outcome may result from high turnover rates.

Reduced Staffing Costs

Organizations may incur large annual costs related to recruitment and training. The greatest approach to reduce those costs is to retain staff.

Improved Customer Experiences

Customers frequently appreciate businesses where they regularly interact with known, welcoming faces and form bonds with one or more employees. Positive customer perceptions can be increased through low turnover rates.

Increased Revenue and ROI

Numerous studies have found a direct link between higher revenues and lower staff turnover, better employee experiences, and higher employee morale.

Key Causes for High Employee Turnover

Despite a company's greatest efforts, respected employees occasionally leave for various reasons. Employee turnover refers to both desired and undesirable departures from your business; however, in this article, we'll concentrate on the reasons why employees leave when you'd prefer they stay, i.e., the instances in which your employee retention initiatives failed.

What Inspires People to Leave a Company?

• Feeling unappreciated
• Misalignment with the values of an organization
• Priorities are now different
• Feeling exhausted

Often, a more enticing opportunity will be presented by another employer. For instance, they might tempt your team by offering:

• Better work-life balance
• Greater satisfaction at work
• More adaptable working conditions
• Improved corporate culture
• Greater pay disparity
• Improved manager-staff interactions
• More favorable chances for career advancement
• Greater career clarity
• Less expensive health insurance

Employee Retention Strategies for Job Satisfaction

Candidates with in-demand talents won't likely have to wait long to find new employment, even though the labor market favors employers in some industries and places. Despite the pandemic, many companies kept recruiting, and many more have increased hiring since.

• On-boarding and Orientation 

Every new hire must be set up for success from the start. Your onboarding procedure must instruct new hires about the job and the business culture and how they may contribute to and succeed in it. 

• Mentorship Programs

An excellent addition to your extended onboarding procedure, particularly in a remote work setting, is pairing a new hire with a mentor. Mentors can welcome new team members, offer guidance, and act as sounding boards.

• Employee Compensation

In order to offer their workforce competitive compensation, which is essential for business success, employers must regularly assess and change salaries. Even if your business is now unable to increase salaries, consider whether you might be able to provide alternative forms of payment, such as incentives. 

• Perks

Offering perks can make your business stand out to prospective employees, re-engage your current crew, and boost employee morale. According to research for our Salary Guide, many professionals value flexible hours and remote work options the most. 

• Wellness Offerings

It's only good business to keep employees well on all fronts—mentally, physically, and financially. Several leading companies improved and increased their wellness programs throughout the epidemic to motivate employees to prioritize their well-being and feel supported. 

• Communication

The shift to remote and hybrid employment has brought into sharp focus how important good workplace communication is. Your direct reports should feel at ease approaching you at any time with suggestions, questions, or issues, whether they are based on-site or remotely. 

• Continuous Feedback on Performance

Many companies are switching from annual performance reviews to more frequent team meetings. During these one-on-one conversations, talk about your employees' short- and long-term professional goals and help them see their futures working for the company. 

• Training and Development

As part of providing continuous feedback on performance, you can help staff members find chances for professional advancement, such as the need to acquire new skills. Your staff needs to be unskilled more than ever as technology continues to disrupt the way we operate. People who improve their skills acquire new skills as the demands of the workplace change.

• Recognition and Rewards Systems

Everyone wants to feel valued and appreciated for their efforts. Be careful to recognize your direct reports for going above and above and emphasize how their efforts benefit the firm. An employer's appreciation can have an especially big impact on today's "anywhere workforce." 

• Work-Life Balance

Maintaining a healthy work-life balance is essential for workplace happiness. People need to know their supervisors appreciate they have lives outside of work — and recognize that keeping balance might be much tougher while working from home. 

• Flexible Work Arrangements

Many companies are aware that some of their employees still opt to work remotely, at least part-time, even after they have reopened their offices. The absence of that option might potentially cause worker resignations. 

• Effective Change Management

Keeping your staff as well-informed as possible during a significant organizational transformation lowers stress and manages rumors. Make important announcements one-on-one or in a group call or meeting, and allow an opportunity for questioning.

• An Emphasis on Teamwork

You should encourage everyone in your workforce, not just the best performers, to contribute ideas and find solutions. Encourage cooperation in a team by providing collaboration opportunities, taking into account the preferred method of working of each person, and giving everyone the freedom to decide and change course as necessary.

• Acknowledgment of Milestones, Big and Small

Seize the chance to celebrate the occasion with your staff, whether it's a significant project that your team finishes ahead of schedule or a worker who has worked for you for five years. Even if you have to celebrate remotely, it may still be a special time that everyone will remember.

Employee Retention Metrics and Measuring

HR departments can use employee engagement software to conduct pulse surveys on employees' perceptions of the business and take corrective action if necessary in areas where workers express a lack of job satisfaction. Since these questionnaires are typically brief and anonymous, employees are more inclined to engage.

A sense of belonging and being heard inside a company are regarded as essential elements of employee retention. Workers routinely stress how important supporting managers are. To measure how employees feel about their supervisors, do regular questionnaires.

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Improve Employee Retention with Corporate Training

Simplilearn’s corporate training in emerging technologies is transforming our economy. Our blended learning approach drives learner engagement and the industry’s highest completion rates.

Did you know that hands-on, interactive learning is five to seven times more effective than simply reading or watching course material? For this reason, our corporate training curriculum includes the following:

• Live online classes
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Simplilearn implementation consultants will work with you to design the best training program for your company. Unlock your team’s potential today!