Having the right employees hired is half the job done. Retaining them is the next big challenge! Because despite hiring through a meticulous process, most employees aren’t seen to work even for a year. It’s been so acute since the beginning of Corona pandemic.
Such unwanted turnovers can cause severe negative impacts on any organization. According to LegalJobs.io, the USA loses around $430 billion annually due to employee turnover. So, how to take this problem under control? You need employee retention strategies.
This article will provide you with 15+ innovative and effective employee retention strategies with examples. It’ll help reshape your perspectives and make a productive workspace.
What is Employee Retention and Why It is Important?
Employee retention refers to the efforts of an organization to prevent its employees from job-switching over a period of time. It measures how well an organization is in holding onto its workers. Gone are the days when only employers had the trim cards to hire and fire employees.
Today, employees also quit their jobs voluntarily and look for new ones if they don’t love their present workplace. According to the US Bureau of Labor Statistics, around 4 million Americans switch jobs each month, and one-third don’t even meet the half-year mark.
Below we’ve listed some surprising statistics. They will make you realize the importance of employee retention in this modern age.
- The average employee turnover costs 33% of their annual salary (Work Institute).
- The lack of good HR management causes employees four times more likely to quit (Tiny Plus).
- Good retention strategies can maximize company profits up to four times (Lessonly).
- 20% turnover happens within the first 45 days of work at a new company (Tanner).
- The cost of replacing a trained employee may exceed 200% of their salary (HR Cloud).
Hopefully, these statistics are enough for you to realize the significance of employee retention strategies. The next section will shed light on this.
15+ Innovative and Effective Employee Retention Strategies
When someone plans to quit his job, the first symptom is he starts being disengaged. It hampers workplace productivity and so many things successively. The following approaches will help you reduce the frequency of such things happening in your organization.
1. Smarten the Recruitment Process
Smart recruiting leads to find out qualified employees. Recruiting doesn’t mean you’ll look into their skills and qualifications only. You must clearly spell out job responsibilities, salaries, career development opportunities, leave management, increment policies, etc.
Don’t play a hide-and-seek game. It will help them constructively decide whether to join the job or not. We’ve seen numerous times employees joining an organization with high expectations. But in a couple of weeks, they experience a completely different picture.
It terribly hurts their ego. This is why over 30% of employees leave their workplaces within the first six months of joining. Make sure the HR manager is smart enough to deal with candidates. And make sure he isn’t biased and allergic to cultural diversity.
2. Create a Memorable Onboarding Experience
Adapting to a new workplace isn’t always an easygoing thing, especially for introverted people. A comfy onboarding process can the thing painless for them. At least it can help them concentrate on their official tasks. Try to consider the following things from your next onboarding session.
- Introduce the new appointee to the team leader and members in it.
- Make sure everybody welcomes him with a warm message.
- Add him to the official communication channels (Slack, MS Team, ERP).
- Give him access to the official assets (laptop, desktop, printer).
- Gift him any good quality item, big or small.
The journey of an employee starts in a new organization with the onboarding process. Hopefully, the above steps can help you create a memorable experience for him.
3. Focus on Good Mentorship
Do you know most people quit jobs not because of workplaces but horrible bosses? 88% of the USA people leave their jobs due to facing poor managers.GoodHire
Workers today don’t love to have boos-like managers. They want friendly managers who will allow them to work freely and interrupt only when they make serious mistakes. But leadership and management are two charismatic qualities that you can’t grow through personal nurturing.
These are some inborn qualities. But yes, those who already have these qualities, through regular nurturing, can take them to the next level. So, if you feel your organization is suffering from a poor manager, try to appoint a new one who can manage people like a pro.
4. Give a Competitive Salary
Competitive salary refers to the range of payment that meets the average market rate for the specific role plus a percentage. However, you can manage employees at a lower salary than the market rate. But you can’t retain them for a long time.
Because they switch promptly whenever they find a better job opportunity. Without competitive salaries, you can’t hire the top-tire talents of the market. Competitive salaries for the same job role may vary by location. So, know the average salary of the location where your office locates.
5. Invest in Their Skill Development
From a recent report on LinkedIn, over 90% of employees agree to stay with a company for long that cares about their skills and career development. Because employees know very well they can’t stay competitive in the market without skill.
You can arrange skill development sessions in two ways. One, ask experienced employees to share their insights with others. Two, enroll employees in online educational academies like Udemy, Coursera, Khan Academy, Codecademy, MasterClass, etc.
6. Prioritize Work-Life Balance
Work-life balance is no more a light word. You’ll find countless people around ready to sacrifice a high-paying job if it’s difficult to have a good work-life balance there. Due to heavy traffic jams, natural conditions, and family problems, some employees may ask for a remote working opportunity.
Statistics show that companies with optional remote working policies tend to experience a 25% low employee turnover (Owl Labs). But being completely remote isn’t possible. Hybrid culture can be the ultimate solution here. Check out the hybrid work model best practices.
7. Recognize Employees’ Contributions
Employees who feel their contributions aren’t recognized are 2x more likely to go job hunting (TINY Pulse). Again, having a delicate employee recognition system effective in the workplace can increase the retention rate by 65%.
But if you have a big workforce, it naturally becomes difficult to monitor each of them manually. Besides, there might be some workers who can’t exaggeratedly highlight their contributions. WPERP can be a savior in this case. WPERP is a powerful HR, CRM, and Accounting management tool.
Using it, you can easily track the performance of your employees, their check-in checkout, project completion time, and how much is remaining from a single device.
8. Handle Changes Tactfully
Workplace culture has changed a lot in the last ten years. A large part of it happened since the break out of Covid-19. We’re hearing that several tech giants are developing numerous high-quality software to facilitate the remote and hybrid work culture. So, it’s needless to say that in the next ten years, the global workplace will get even more changed.
But changes aren’t accepted well for always. You’ll certainly find some people against new changes. As an HR manager, you mustn’t impose anything instantly. Rather, allow them to get prepared so they can adapt to the changes when you implement them.
9. Allow Flexibility in the Workplace
You must not confuse flexibility with work-life balance. Flexibility allows employees to reschedule their tasks and complete them within the due time. But why? Due to kids’ school, medical appointments, bank hours, and other issues, someone may delay joining the office on any particular day.
If the workplace is flexible, employees can complete projects/tasks on the same day or the following day by doing overtime. They can even work on weekends. However, the total number of office hours will remain the same.
10. Let Them Communication
The rapid growth of remote and hybrid cultures has highlighted the importance of a good workplace communication system. Whether they have a new idea to share or submit a report, online-based communication tools like slack and Microsoft Team can be helpful.
Using them, you can create multiple groups for specific team members where they can share new ideas, comment, and reply. In addition to that, allow employees to communicate before implementing any new change. It can improve the possibility of success of change implementations.
11. Reduce Employee Burnout
Employee burnout refers to the state of physical, emotional, and mental exhaustion caused by extreme stress in the workplace. Symptoms of burnout include a lack of interest in work, a negative attitude toward colleagues, increased absenteeism, depression, and lack of motivation.
Forbes revealed in a report burnout is a key reason for up to 50% of annual workforce turnover. Reducing burnout will not only improve employee retention rate but also boost motivation, engagement, and productivity. HR Managers can reduce employee burnout by providing clear expectations, promoting work-life balance, and recognizing their contributions.
12. Strictly Disallow Racism
According to SHRM, employee turnover due to racism cost the USA organizations around $172 over the last five years. Reduction of productivity isn’t the only reason behind that. It’s today a sensitive social issue. Customers avoid buying from organizations that practice racism.
Besides, racism creates a toxic work culture where people feel mentally sick and demotivated. To prevent racism, you must clarify to your employees from the first day this organization is highly committed to diversity and inclusion. Make sure the newcomers are culturally fit with your organization.
13. Focus on Team Building
Teamwork means a group of people running together to achieve a common goal or objective. According to Zippa, teamwork can reduce the employee turnover rate by 50%. It makes them more effective in completing tasks than those who work independently. This is why the teamwork culture increased by at least 50% over the twenty years.
So, how to create a teamwork culture? Suppose you are a software company. You may create teams of developers, marketers, content, HR-admin, etc. You may assign a sub-team for each if you have multiple big-selling products. Based on organization type, methods and approaches to team building vary.
14. Ensure Hygiene and Safety Protocols
A clean and safe environment can prevent the spread of illness and disease. It will give them a comfy secure feeling. Plus, ensure the following measurements to make sure your workplace is secured.
- Get ready a first aid kit box with necessary amenities.
- Conduct regular safety inspections to identify if there are any potential hazards.
- Provide the cleaning staff with protective equipment like PPE, gloves, masks, and glasses.
- Keep the kitchen and dining room neat and clean.
- Make sure proper ventilation, lighting, and ergonomics.
- If your office is in a multi-storied building, train employees so they can make an emergency exit in case of an accident.
15. Reward Them for Good Performance
Rewards are something extra than the basic salary. It’s fine if you don’t give it. But rewarding employees based on their performances can boost their satisfaction unimaginably. This is why it is practiced today in many modern workplaces. There’re four types of reward systems:
- Monetary (occasional bonus, profit share, incentives)
- Non-monetary (annual tour, vacations, lunch/dinner/buffet party)
- Assistance (discount on health service)
- Recognition (verbal praise for work)
16. Know When It’s Time To Say Goodbye
Firing employees isn’t a good practice. It can make other employees morally down and startle them to look for better jobs. However, every employee has a life cycle for particular positions. Once they reach the end, neither can they produce value nor can you extract from them.
An ultimate solution is to promote them to an upper position or be prepared to say goodbye. Better if you know what the employee life cycle is. It will help you have a plan for each of your employees from the recruitment day.
You will know when to train them to enhance their skills, how to use them in different positions, and when to offer them voluntarily quit.
Bonus Point: Employee Appreciation Ideas
Employee appreciation is the act of recognizing their contributions and reward accordingly. We’ve discussed both these topics in the above discussion. But due to its massive importance, we’ll cover this once more with a bit more detail. Below are some proven and trendy employee appreciation ideas you can implement in the workplace.
Idea 01: Arrange Surprise Party
You can arrange a small pizza or snack surprise party every three-four months in the office. Or suppose the marketing team has managed million-dollar sales on Black Friday and Cyber Monday. With a small surprise party, you can make the event memorable.
Idea 02: Share Employee Performance on Social Media
Social media is a powerful platform today that can be used as a portfolio element. Sharing your employees’ performance by their name on social media can open up their potential in the high-tier job market. It won’t cost you any money but will bring esteem and productivity.
Idea 03: Engage Family Members
Once family members know their husbands, sons, and daughters are working in a safe workspace, they feel socially esteemed and have mental peace. You may arrange an annual program where family members will be invited and can explore the workspace.
Idea 04: Support with Commute
Research shows that 10-15 percent of the employee’s salary is spent on travel expenses. Allowing hybrid culture can save some of their costs. If possible, try to reimburse some of their expenses in other ways, like by paying the parking fee.
Idea 05: Offer Extra Day Off
Indeed, it’s impossible to offer extra days off on busy days like when the sales campaign goes on. But when there is no sales pressure and nationwide holidays go on, you can add one or two more days off. Hopefully, it won’t disrupt productivity but will let workers enjoy more relaxation.
FAQ on Effective Employee Retention Strategies
We hope you’re enjoying this discussion. Now, we’ll answer some common questions frequently found online related to the topic of effective employee retention strategies.
1. Low pay
2. Job insecurity
3. Horrible bosses
4. Extreme work pressure
5. Poor work-life balance
6. Lack of career development opportunities
The employee turnover rate is calculated by dividing the number of employees leaving a company during a certain period by the average number of employees during the same period.
For example, a company had 100 employees at the beginning of the year, 10 of them left, and by the end of the year, it had 110 employees. The employee turnover rate would be: (10 / (100 + 110) / 2) x 100 = 9.09%.
1. Efficiency rate.
2. Level of creativity.
3. Consistency in self-development.
4. How other colleagues like him.
5. Level of authority and how he benefits others.
6. Percentage or number of works completed on time.
1. Revise his capabilities.
2. Have a valid reason to fire.
3. Listen if he has anything to say.
4. Give him at least one month to find a new job.
5. Take off access to confidential information.
1. Don’t share access to sensitive data with all employees.
2. Make sure data is encrypted while sharing on different devices.
3. Check the IP addresses that are trying to access sensitive data.
4. Use malware and brute force attack plugins.
5. Kill employees’ emails and accesses when someone resigns.
Are You Ready to Implement These Strategies?
Employee retention is the key to maintaining a successful and productive workforce. They are more powerful today than ever before. Due to the expansion of communication technologies, today’s workers have more job opportunities both locally and internationally.
So, leaving them disturbed and dissatisfied, it will be impossible for any organization to achieve the ultimate milestone of success. We’ve tried our best the in this article to cover all the possible approaches you can follow to improve employee retention rate.
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