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.
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