Worried about reducing employee turnover? You should be. Consider these facts: the average raise an employee can expect is three percent, which ends up being closer to 1 percent with inflation — hardly a noticeable difference in a bi-weekly paycheck. If that same employee was to land a job at a rival company, however, they could expect a salary bump between 10 and 20 percent.
This adds up over a lifetime of working. Staying employed with the same company for over two years will cut your lifetime earnings by about 50 percent, reports Forbes. Not much incentive for the employee to stick around! It gets worse for the companies. For mid-level employees, it costs upwards of 150 percent of their annual salary to replace them.
In essence, employees who jump ship are rewarded, while loyal employees are essentially punished for their dedication.
But there’s a lot you can do to reduce employee turnover and increase employee satisfaction, even if you truly can’t afford to give out more than a three percent raise.
How to Reduce Employee Turnover
Offer Competitive Benefits
Telecommuting and flextime don’t have to cost your company a penny, and these two in-demand benefits can boost employee satisfaction. Employees with flextime tend to be happier at work. They retain a greater sense of autonomy over their schedules. They can get the big report finished and still make their daughter’s soccer game or go for a run before dinner. Four out of five employees of Accenture, a global professional services company, say that their ability to manage work and home life affects career choices and desire to stay at a certain company, reports CBS News. Flextime may also cut medical costs by lowering stress and burnout by 30 percent, according to Bristol-Myers Squibb.
Invest in Employees with Career Building
How much do you value your employees? Employees that feel valued and see a clear future trajectory with their current company are less likely to jump ship. This year, consider what conferences or employee training programs your business can offer. For example, Deloitte views talent development as a key element in their value proposition to clients. This value prop is reflected in the company’s commitment to investing in employees through the company’s “Deloitte University” program; in essence, Deloitte wants its employees to be able to solve any business problem a client may face, be it an issue with the tax code or a technical implementation. The result: happier clients, happier employees, and better performance.
Reduce Stress and Anxiety with a Supportive Workplace Culture
Do your employees walk into the office and cringe at the tension in the air, or do they feel relaxed and at ease? Do employees feel encouraged to express their ideas or do they worry about being shot down and turned into the butt of office jokes? A supportive workplace culture can go a long way to improving employee satisfaction and reducing turnover, according to a Gallup survey on reducing employee churn.What does a supportive workplace look like? It may be slightly different for every company.
Younger companies may want to take a page from Silicon Valley and add Millennial-friendly perks like catered lunches and sports facilities or gym access. Allowing employees to bring their dogs to work is a popular benefit. If your work space isn’t a good fit for dogs, consider investing in an office aquarium or personal pet goldfishes for employees. Aquariums are also one of the surprisingly affordable ways to reduce stress and anxiety in the workplace.
Bottom Line
High employee churn can hurt your company’s bottom line — and worse — send a subtle signal to would-be employees that your business is not a desirable place to work. Offer competitive benefits (like flextime), invest in employees with career-building opportunities, and take steps to reduce stress and anxiety in your workplace culture. Finally, don’t discount the importance of smart recruitment strategy when reducing employee turnover. Hire the right people from the start by not only vetting skills but also company culture fit.
Employees Photo via Shutterstock
Those salary numbers are depressing for an employer to see. Hopefully though, money isn’t the only reason people work for you. Great tips here on improving the situation. I would just add that once people have their basic needs covered, the money becomes less of a primary motivator.
I tell you though, I hate situations where an employer is in the mindset of taking advantage of their employees, by overworking and underpaying them. That seems to be the norm. Greed is an epidemic in the workforce.
Aira Bongco
Sometimes, it is not just about the money. Employees have different reasons on why they stay at a particular place. Sometimes, it can be just be the supportive working environment. That can make them stay.
For the most part, people settle. IMHO
I agree. Employees are working for more than just money anyway. Sometimes, they are looking for freedom, benefits, support or meaning. While it may vary from person to person, these are still some of the reasons why people stay.
Thank you for reading my post and for your input.
usually, the idea of taking care of employees can be taken way too seriously. Sometimes, it can be as simple as talking to your employees and asking for their needs. You can then find out what they need from there.
I agree with the comments. Money isn’t everything. I know I left one job because they not only offered no growth/learning opportunities, but they also dismissed my efforts to add skills on my own. I would have stayed if management had given even a little support.
Seymore
Don’t forget to look to the immediate supervisors/managers.
“People leave managers not companies.” (Buckingham and Coffman, 2012)
A bad manager can take a good staff and destroy it, causing the best employees to flee and the remainder to lose all motivation.
catherine
This is so true! A bad manager/leader permits a toxic environment.
catherine
Flex time/comp time is a wonderful thing. It really works. Wish school systems followed that for their non teaching staff. I would like to know what the “fear” is of putting things in writing. These days nobody wants to.
Shantele peters
I have a question.. I work for a company called Think Ability. What I do here is I am a DSP (Direct Support Professional) I take care of Development Disability I work 49-60 hour weeks the turn over rate is very high here. Is there such thing as an overnight difference I get paid 9.00 a hour and I work over nights I have been at this company for going on 2 years and half of that I have been the only over night staff. I have been trained in 2 different houses that’s not including the house I was a sign to when I started in 2018. We have an Adult Day that there is 4-5 staff to 7 residents im not the sharpest tool when it comes to labor but I was a early preschool teacher before coming into this field and I had 8 students to myself so that don’t sound right. They could use what they are paying them and give the residential staff a pay raise am I wrong on the labor