High turnover rates are what kills companies.
Every month, about 3 million Americans quit their job in search of something better and one-third of employees quit with six months.
By some estimations, on average it can cost a company nearly double an employee’s salary to fill the vacant position. Depending on the industry, seeking a replacement can cost an employer a lot higher than that.
It gets worse.
Life Work Solutions, a provider of staff retention and consulting services, provides us the following facts:
- Over 50 % of people recruited into an organization will leave within 2 years.
- Nearly 70% of organizations report that staff turnover has a negative financial impact due to the cost of recruiting, hiring, and training a replacement employee and the overtime work of current employees that are required until the organization can fill the vacant position.
- Nearly 70 % of organizations report having difficulties in replacing staff.
- Approximately 50% of organizations experience regular problems with employee retention.
The fortune of an organization lies on the shoulders of HR personnel to not only stopgap the turnover frequency but to also boost employee retention.
Determining the Reason Why Employees Quit Can Be Difficult
Justified or not, there is a myriad of reasons for an employee to quit his job. Some common ones are a mismatch between the job and person, conflict with salary, burnout, lack of growth and advancement opportunities, and a hostile workplace environment.
Whenever an employee quits their job, it becomes the responsibility of the HR department to find out the reason(s) that triggered their resignation.
“The best defense against employee turnover is understanding why people are leaving in the first place. If you demonstrate a genuine attempt at understanding the “why,” people will tell you. Then it is up to the organization to make the necessary changes,” says Bento HR Chief Innovation Officer Matt Burns.
Exit interviews are a common method used by HR teams to figure out the underlying reason.
If conducted properly, an Exit Interview can uncover what the organization needs to improve on and point out overlooked challenges and ideas. It enhances retention by showing employees that their concerns and options matter.
Career Mapping Is an Important Key to Retaining Talent
An often-overlooked aspect of employee retention is career development. Employees are often driven to quit because they were never given a clear path for them to advance or are not sure what the company expects in order to receive a promotion.
Most people seek roles that deliver growth potential and opportunity. Helping employees take advantage of the opportunities around them will create more fulfilling experiences and connections to the company, in turn reducing turnover. – Sara Whitman, the Senior Director at Peppercom.
Career mapping provides employees a clear framework that defines what it takes for workers to qualify for a promotion. HR departments need to outline clear expectations before the hiring process and after the hiring process what it takes to get promoted.
“First, understand the employee’s goals and offer a career path with clear company expectations to move forward. Second,
However, it is not enough to just outline the goals needed to earn a promotion, HR personnel need to check-in regularly to see how employees are keeping up with these expectations and offer support
Support that goal by developing skills and knowledge to meet that goal. This can be accomplished by low-cost online learning, mentorship and appropriate internet knowledge content such as YouTube tutorials and Ted Talks,” says Kristin Williams, the Director of Enterprise Services Group at Ultra Mobile.
Providing training and professional development opportunities helps keep employees onboard because it shows that the company is invested in their success. know you’re invested in supporting their continued growth.
Moving Laterally Also Enables an Employee to Grow
Even when an employee qualifies for a promotion it is not necessarily possible to provide it right away, either because the position is already filled or there isn’t a need for it at the moment. Luckily, HR can keep employees onboard by still filling an employee need to grow in a company by offering the chance to move laterally.
Unlined a promotion where an employee steps up the company ladder, a lateral move employee moves to an equivalent role within the same company but changes aspects of their job responsibilities
A recent study published by LinkedIn examined 32 million LinkedIn profiles to determine a statistical understanding of the retention curve. As part of the findings, the data shows that employees who switch roles at their companies are more likely to stay on board for the long run.
According to the study, employees who make a lateral move have a 62 percent chance of staying on with the company and those who are promoted have a 70 percent chance of staying on with the company and those. Meanwhile, employees who remain in their current position for three years or more only have a 45 percent chance of staying on.
A lateral move provides an employee with a welcome challenge to further develop their career path by learning new skills and additional responsibilities. Providing space for lateral move sends an important message to the entire team that they’re not just cogs in a machine, and that the company leaders are committed to giving them the opportunity for bigger and better opportunities when the opportunity presents itself.
According to a recent survey by Korn Ferry, the global people and organizational advisory firm, nearly 73% of the 2,000 respondents survey said that the desire for new challenges would drive a job change.
We know that 55 percent of all U.S. employees are not engaged at work. They are basically in a holding pattern. They feel like their capabilities aren’t being tapped into and utilized and therefore, they really don’t have a psychological connection to the organization,” says Curt W. Coffman, global practice leader at the Gallup Organization.
Despite the salary and money usually being the same, the new environment, skills, and responsibilities will help the employee overcome boredom and dissatisfaction that can easily drive them away to look for a new position elsewhere.