Employee Retention: How to maintain your team

What does employee retention mean?

Employee retention is the ability to hire and keep employees for a long period, avoiding rapid employee turnover. This means that companies have to create a welcoming environment for their staff and make it worthwhile for people to stick around, rather than move onto something else. Companies have to balance giving people autonomy with enough direction, while giving people the opportunity to grow and most importantly making people feel like they’re valued and that their work is contributing to something greater than themselves.

The term “retention” can lend itself to misinterpretations in the implementation of this strategy. Here are some examples of unfair practices: 

• Increase the salary of all employees without making any distinction of performance or commitment to the company.
• Prevent employees from resigning due to a bad work environment, organizational disorder, lack of leadership, or mistreatment.
• Retain employees only to avoid high costs of compensation or training and training of new staff.
• Redistribution of work and automatic promotions without a development plan.
• Transfer of employees to another office or branch in an improvised manner.

Why is employee retention important?

Did you know?

• The overall U.S. turnover rate is 57.3% (Source: Report of the Bureau of Labor Statistics)
• 65% of U.S. employees think they can find a better position elsewhere (Source: Fortune) 
• Every month in the United States, 3 to 4.5 million employees quit their jobs (Source: Job Openings and Labor Turnover Survey (JOLTS))
• 25% of full-time employees plan to look for a new job with a different employer after the pandemic (Source: Pulse of the American Worker Survey)
• Employees who feel their company offers positive learning opportunities are 21% less likely to leave their organization (Source: Harvard Business Publishing)
• The number one reason for the leaving of employees in 2020 was career, which meant a lack of opportunities for growth, achievement and security: 1 in 5 employees left for this reason. The second two main reasons for the exit were: health and family problems and work-life balance. (Source: Work Institute’s 2021 Retention Report)

All these indicators allow us to understand the importance that organizations have to give to employee retention. 

Today, having excellent human talent is not an easy task. Many companies have to dedicate a lot of time and resources to build a valuable workforce.

Having valuable workers in a company, who give extra value, an advantage over the competition, and who want to stay in the organization generates numerous benefits such as:

• Increased efficiency at work due to the greater ability to detect weaknesses and strengths and implement continuous work performance improvement.
• Improved performance by a greater motivation to achieve objectives.
• Increased employee satisfaction by seeing their effort, their work, and their talent rewarded.
• Increase in customer satisfaction, which implies loyalty that is linked to the results of the company.
• Strengthening of the organizational culture.

All this impacts a lower percentage of staff turnover since you will have talented, satisfied employees who want to stay in the company longer.

100% staff retention will never be achieved by a company. And you shouldn’t expect to do so as a certain percentage of turnover can be favorable. However, excessive turnover would create a problem for any business that can bring short- and long-term consequences for the company. For this reason, companies are interested in keeping talented employees on board since the consequences of not doing so are mainly the high costs of hiring and training, the lack of qualified personnel, and the decrease in morale in the workplace.

Causes of high employee turnover

The most common causes of high staff turnover are:

1. Employee and company do not match causing high employee turnover

Selecting a good candidate for a job goes beyond choosing the person who has a brilliant resume. A good candidate will have the optimal skills and capabilities to develop their position and have to fit with the company’s culture to which they are applying. The brightest professional will be useless if he does not match the organization’s values.

2. Cause of high employee turnover: The work did not turn out as expected

Many leave because the work didn’t turn out to be what they initially thought. This is because in some opportunities, there is no good communication strategy within the human resources department, and this makes it difficult to understand the job roles clearly. It may also be that the hiring managers have concealed information about the roles and responsibilities of the position or the true purpose of the job.

3. Missing opportunities for professional growth within the company

Nobody likes to feel stagnant at work, everyone wants growth, and if the organization does not offer them opportunities internally, they will end up resigning. The more professionals organizations have, the greater their aspirations, and they will look for challenges that allow them to grow professionally.

4. Missing continuous feedback causing high employee turnover

Employees want to know if what they are doing is going well and if there are aspects that can be improved, and they want this constantly. Giving a review every six months or every year is not enough, it generates demotivation and stagnation in the performance of employees, and a great opportunity for professional growth and continuous improvement is lost.