If you aren’t measuring employee turnover and retention, you may not be aware of it. But when a high proportion of your staff leave voluntarily each year, it leaves you with the costly HR task of recruiting and training replacements. That’s obviously bad for business.
Improving staff retention is the answer. Retention is the proportion of long-serving employees at your organisation. When staff retention is high, you don’t just retain the person — you also retain their skills and knowledge, which generally grow stronger and more valuable by the year.
Assessing staff retention
Before you set out to improve employee retention, it’s important to assess the nature of the problem.
There are well-established policies you can implement to:
- measure turnover and retention levels
- assess the cost of turnover
- understand the reasons causing high turnover at your company
Check out our advice on turnover and retention policies.
Measures for improving staff retention
Once you’ve established the nature of the problem, you might consider the following methods as part of your retention improvement strategy.
Offer accurate job previews
When an employee takes a new job that sounds great, but then discovers their new role isn’t what they expected, the result is often low job satisfaction. The employee may look to move on quickly, contributing to high turnover.
Make sure you give applicants a realistic job preview during recruitment. This might require you to conduct a new job analysis — roles do change over time — but the improvements in staff retention may be worth it.
Conduct employee consultations
For existing employees, it’s too late for a job preview. A practical way to address their job dissatisfaction is to enable employees to voice their concerns. Ask employees what they’d change about their job and the workplace, through:
You can then address staff feedback to increase job satisfaction and retention, where needed.
Offer development and progression opportunities
Employees who perform well are often ambitious with it. They want to move up the career ladder — and if they don’t see promotion opportunities at your organisation, they’ll look elsewhere.
Consider using internal recruitment, development, and succession programmes, which evolve skills and knowledge within your company and motivate employees to stay and progress.
Let staff work more flexibly
Allowing them to be a bit more flexible in their working hours and work style makes employees feel more trusted and helps them achieve a better work-life balance. That’s sure to increase job satisfaction and staff retention.
Flexibility works best in organisations where staff can be trusted to work their own way.
Address perceptions of unfair or unethical behaviour
Finally, the HR concept of the ‘psychological contract’ means an unwritten understanding between employer and employee that each will act reasonably and uphold their side of the bargain. When employees perceive that the psychological contract has been broken, engagement and staff retention can be affected.
Examples might include:
- Salaries and bonuses not being equal between staff with similar roles and performance
- Downgrading of key benefits such as pension contributions or company cars
- Revelations about unethical business activities
By addressing breaches of employees’ trust quickly, you can protect morale and maintain or improve staff retention. And that means retaining rare skills that your company can’t afford to lose.