According to Gallup, 48% of US employees are actively job-searching. Quit rates reached record levels last year, to the point where people are labeling it “The Great Resignation.”
Gallup’s research shows that employee discontentment and disengagement are the primary drivers behind the unprecedented quit rates.
These stats can be alarming for employers, but they also present a window of opportunity. If you can foster employee engagement and satisfaction, you’ll be able to retain talent and reap the benefits of a happy, motivated workforce.
Are you chasing your best employees away?
Learn the basics of business retention in this guide.
Offer Competitive Remuneration
Inflation rates rose across the globe last year, and workers are feeling the pinch on their pockets. As prices rise, competitive salaries become an increasingly important component of employee retention.
Money isn’t the only thing that can motivate employees. But below-average remuneration can impact employees’ financial security and make them feel unappreciated, especially when costs of living rise.
Statistics show that higher pay has become the most important job quality factor in 2023. Roughly 78% of job seekers believe that changing jobs will allow them to receive better pay.
If your organization is in an expansion phase, growth can take top priority in budget allocations. But this can backfire. Salary increases and competitive pay are critical for reducing employee turnover costs.
Replacing an existing employee can cost one-half to two times the employee’s annual salary. If it reduces employee turnover, paying workers more could save you money.
Allow Remote and Flexible Working
Want to know the second factor that drives workers to change jobs? Lack of flexibility.
Remote work has quickly turned from a perk into the norm. Findings from Future Forum show that 43% of partially remote employees would resign if they had to return to the office entirely.
Additionally, 75% of employees who are unhappy with their current level of flexibility plan to switch jobs within the next year.
These findings show that flexibility is a top priority for workers. Hybrid models are a particular favorite. Almost 70% of workers expressed a preference for being able to access a physical office space.
Every organization is different, and hybrid roles aren’t always possible. If your organization is operating on a solely remote model, you can offset this by offering workers co-working space memberships.
Hire From Within
If you want to retain talent and slash employee turnover, we have a hot tip. Hire from within.
LinkedIn’s 2021 Learning Report showed that companies with high internal mobility retain employees for almost twice as long. In other words, companies that hire from within keep their top employees.
Over the last two years, this finding has remained unchanged. LinkedIn’s latest report reveals that employees who make an internal move within two years at a company are almost 20% more likely to stay with the organization.
Hiring from within also has a wealth of other benefits. Internal candidates are usually a better cultural fit, which can facilitate smoother inductions. Onboarding time and expense are often reduced, and employees can transition faster.
Hiring from within can also trigger cost savings. As well as boost company culture and promote leadership development.
Upskilling and reskilling employees is one of the cornerstones of internal hiring. You should also develop succession plans for key positions and offer mentorship and coaching. Not only will this set you up for internal mobility, but it can also be another big driver of employee retention.
Focus on Skills Development
Skills development is also a critical ingredient to keeping employees happy. Nobody wants to feel like they’re stagnating in a job.
A survey from Microsoft shows that over 60% of Gen Z, Millenial, and Gen X workers feel that the best way to develop skills is to change companies.
A further report from Microsoft found that 68% of employees would rather make a lateral move internally and learn new skills than take a higher position with fewer opportunities for growth and learning.
Skills development takes time to implement, but it can generate multi-faceted rewards. The best place to start is with skills mapping.
One of the things that makes tenured employees leave is resentment. Being passed up for a raise or seeing a junior employee out-earning them can make experienced employees feel unappreciated.
If you don’t want to lose employees due to hurt feelings, foster a sensitivity to these situations. People’s feelings matter, and they can have a big impact on company performance.
Start by instilling sensitivity at a management level.
Research from Gallup shows that 52% of employees who left a company said their manager could have done something to persuade them to stay.
Promote a Healthy Work-Life Balance
A healthy work-life balance is another integral part of a happy workforce. It’s also vital for productivity.
The 2023 Future Forum report shows that burnout is rising globally. More than 40% of respondents reported being burned out. The same survey revealed that burned-out employees are 3.4 times more likely to look for a new job.
These findings show that a healthy work-life balance is also a critical employee retention factor.
Enabling work-life balance shouldn’t be an afterthought. It should be woven into team management. Telling workers to make time for self-care isn’t enough.
You have to create conditions that allow employees to recuperate. You also have to ensure responsibilities are allocated in a way that doesn’t trigger burnout in the first place.
Invest in Company Culture
Company culture is another area that can have a big impact on employee retention. Who wants to stay in a toxic work environment? Employees want to feel valued, respected, and united.
Fostering these sentiments has to happen both at the ground level and in upper management. Organizations have to actively shape and nurture positive values and behaviors.
Implement These Business Retention Tips
If you want a thriving business, retention of your best employees is critical. The most effective way to keep good employees is to make sure their needs are met. Currently, employees are prioritizing pay that keeps up with inflation. As well as flexible working arrangements and skills development.
Burned-out employees are more likely to leave, and company culture is key.
Do you need help implementing the above tips? Bradford Jacobs can help.
We assist organizations with everything from skills mapping to salary bands, onboarding, induction, and more.
Reach out to speak with a consultant today.