About one-third of employees will quit in the first 6 months of getting a new job while 35% of employees are planning their leave if they do not get a pay increase within 12 months. Hence almost 80% of corporate leaders’ view employee retention as a critical issue.
It is no news that employees, especially the highly skilled ones, are the greatest asset to the productivity of any profit-focused organization.
Then imagine a scenario where the engine of a car malfunction, stagnancy right? Such is the case of poor Employee retention in an organization. Poor employee retention is not only frustrating, but it's also costly!
Poor Employee retention, in most cases, leads to financial losses, which at times, is equal to half of a full annual salary per incident.
An organization will not survive if the workers are unfocused and less serious about their task. The success and failure of any firm depend primarily on the effort put in by the employees to achieve the goals and targets of the organization.
It is essential to know the possible effects that may arise due to poor employee retention, and then we can mention possible solutions.
Why do you have to increase your employee retention rate?
Every organization wants the best set of individuals to handle their available jobs, hence a need to invest its money and time to train entry-level workers to mold them to what is required and also to bring him at par with the existing employees. Don't you think it's a significant loss when such a trained employee quit all of a sudden? Then there would be a dire need for hiring to be started all over again with no assurance that the new employee would fit in for the profile.
Furthermore, regular employment of workers poses a great danger to the development of such organization where employees are changed regularly, all because employees who spend a reasonable amount of time in any organization would know better and thus will be able to give maximum result. They are conversant with the company policies, and adjustment is easier for them. For an unstable employee, adaption is difficult, thus a low performance which suffers the work and the organization at large.
In situations of poor retention policies, the employees are just not concerned about the reputation of their office, and for that, they avoid taking the initiative innovate a developmental process. Conversely, employees who have been there for a long time in the organization can be relied on by the management.
Competition is a norm for any business, did you know that poor employee retention helps your competitors? In most cases where individuals leave any organization, there is a high possibility that they are on the road to joining the competitors with your ideas and skills.
Sometimes, employees go with confidential information which they might want to use to impress their new organization and thus the leaking the plans of the organization before they even implement the idea at all.
An organization needs a good reputation no matter what, and this calls for an organization to have a group of loyalists who will be responsible for furthering the brand image of the company else the organization can’t perform well if the employee speaks contrary about it. Research shows that employees working in an organization for a long time never badmouth it because they tend to be more emotionally attached, but for People leaving in a short time, it is easier for them to badmouth their previous organizations. The loyalty level is close to zero.
How to increase job retention rate
In management, the employer-employee relationship is vital since it the basis for efficiency and productivity. Hence, as a manager or HR, the sanity of that relationship deserves your attention. The following approach will your organization's employee retention and as well increase employee satisfaction:
Workplace arrangement—It’s well known that an ergonomic workstation can impact employees' performance positively and also increase overall wellness. The U.S. Bureau of Labor Statistics reports that 31 percent of worker injuries are due to sprains and strains during work hours, thereby posing a health effect that will cost employees an average of 12 days to recover before returning to work and in a case where the health condition becomes persistent, then an employee may decide to leave. Poor health situation is one of those reasons why an employee would never want to stay in an organization. Therefore to increase employee retention rate, it is imperative that organization provide the best of ergonomic chairs, height adjustable desk, and Standing desk converters for their employees to achieve the maximum result.
Employee compensation —A compensated employee would always want to give more to an organization, and it is specifically essential, especially with the increasing competition in the labor market. Compensation packages which include in-time payment of salary and also bonuses, paid time off, health benefits, retirement plans, and possible packages that will make your organization a place where everyone would want to work.
Fostering teamwork — There is power in multitude they say, the main reason why most organizations hammer on cooperation. Collaboration culture which gives rooms to individuals' working styles and talents is one of those ways by which employees can maximize their potential to achieve that common goal. Teamwork is fostered by stating clearly; business goals and objectives, the team roles, and encouraging each employee to put in their best.
Team celebration — Make the workplace fun, celebrate employees, celebrate success. At the end of that big project or say an employee just got a new car, having a get-together party isn't a bad idea. It fosters unity and unity brings more productivity. You are indirectly building a work family.
Recognition and rewards systems —The nature of man requires that it is appreciated, especially when he does something spectacular. It should be part of the organizational procedure to thank your direct reports when they do the extras, be it with a sincere email, a gift card, or it might even be an extra day off. It is also good to let your employees know how much their effort assist in the organization. No one would want to invest energy in a place where the result is unseen. A recognition program is also an excellent way to appreciate your employees.
Work-life balance —Burn-out is one of those reasons why employees would want to leave a job irrespective of the pay, human so much cherish freedom, especially during leisure time. If employees are expected to work round the clock, you'll likely run into issues with employee retention. An excellent work-life balance is essential, and workers need to see the humane approach from the side of the management. Provide staff with vacation opportunities, and if there is a need to keep the late night at work, you could provide an extra day off to compensate them and thus increasing job satisfaction.