We outline 10 reasons why employee retention is important, alongside practical advice on how to improve your organisation’s employee retention rate.
The last two years have heralded unprecedented levels of disruption and change across the workplace. From furlough and home working to changing domestic priorities, over 40 per cent of employees intend to look for a new role in the second half of this year.
Given the considerable cost of recruitment and selection, we don’t need to ask why employee retention is important. What we need to do as employers is maximise employee retention rates by addressing the key grievances and concerns that lead people to look for new roles.
With a recent American survey suggesting 77 per cent of staff departures are preventable, we’ve listed 10 ways to increase your employee retention rate. Some won’t cost a penny, yet they could save you a fortune – especially considering the cost and manpower involved in recruitment and selection.
scenario 1: an employee hands in their notice.
opportunity: conduct an exit interview.
A resignation presents a unique opportunity to have an honest discussion. An employee with an exit route is more likely to point out examples of bad management or issues in their job. Compile their comments into employee retention notes and use feedback to shape future applicant selection processes, reducing the risk of other staff leaving for the same reasons.
scenario 2: a new employee needs onboarding.
opportunity: develop successful onboarding strategies.
The first weeks in a new role are critical to building a sense of permanence, especially while the window of counter-offers from former employers remains open. Gradually furnish new employees with information about the firm and coach them on their new role, supervising training and arranging meet-the-team social events after work to help them settle in.
scenario 3: your corporate culture is different to that of other firms.
opportunity: appoint a mentor/buddy for all new employees.
Mentoring is an underappreciated tool, often setting the tone for an employee’s time with the firm. A new hire will feel nervous in an unfamiliar environment, but an established colleague can help them settle in more quickly. Mentors don’t just offer technical advice – they can become trusted companions, sharing wisdom and building bridges with other colleagues.
scenario 4: staff feel undervalued.
opportunity: increase incentives.
Even before the current economic headwinds arose, two-thirds of employees looked for new roles primarily for financial reasons. Beyond basic salary increases, boost employee packages with perks and benefits they might not get elsewhere. Examples include private medical cover, paid qualifications, additional holidays, and achievement-based incentives.
scenario 5: staff are struggling with mental health.
opportunity: introduce wellness offerings.
Many people are struggling with their health post-pandemic, so offer discounted gym memberships – but accept not everyone has the time or energy for exercise. Prioritise mental wellbeing by running stress management programmes, outsourcing mindfulness classes and one-to-one counselling. Happy staff are less likely to feel motivated to seek a new role.
scenario 6: staff feel unappreciated.
opportunity: introduce continuous performance feedback.
Annual appraisals won’t stop disengagement spreading among colleagues, yet regular chats or engagement surveys increase loyalty. Introduce open-ended feedback with junior staff, such as monthly catch-ups to discuss goals, opportunities, and progress. Resolve concerns when they arise, while honestly explaining any challenges the business faces.
scenario 7: employees feel stuck.
opportunity: offer training and continuous professional development (CPD).
Points 5 and 6 can be met by giving employees a sense of greater direction. This might involve a path to promotion, underpinned by training and CPD. The cost is repaid many times if staff (a) remain with your organisation and (b) take on greater responsibilities with (c) more enthusiasm. The hireful academy is a fine example of a free online training resource.
scenario 8: punctuality is dropping.
opportunity: introduce flexible working.
An employee who’s routinely 10 minutes late to work might be doing the school run. Someone who takes regular sick days might be battling health problems. Consider flexible working hours – if the job’s getting done, it doesn’t matter if it’s partly being done at night. Many staff crave flexibility post-pandemic and will view flexible hours as a key perk.
scenario 9: staff are burnt out.
opportunity: encourage smarter working.
Long hours don’t always equate to high productivity – the opposite can often be true. It’s better to work less and achieve more with greater enthusiasm. Ensure staff are taking their full annual holiday allowance; if not, ask why. Teach efficient working practices – turning off email during busy periods, avoiding flicking between tasks, and so forth.
scenario 10: staff don’t know what’s happening elsewhere in the company.
opportunity: celebrate milestones.
If someone helps to secure a lucrative new contract, send them a thank-you gift. If the firm reaches a revenue goal, give everyone a day off. Milestones don’t have to be major, and they don’t need to be expensive. Warm praise can send a staff member home happy, feeling more enthusiastic about coming back to work tomorrow.
take the next step
If the above has inspired you to make changes in your organisation, hireful is here to help. Our online resources portal includes a collection of informative recruitment webinars, covering everything from creating compelling job ads to making the most of LinkedIn.