People are what make companies successful, and retaining top employees has always been a challenge for many companies. Employee retention is always top of mind for executives, though often left at the bottom of the pile of other duties and concerns. So most companies don’t even broach the conversation until it becomes a major problem. Now more than ever, with many companies faced with the difficult decision of whether or not to lay people off during these unprecedented times, it’s important to have this conversation. When the public crisis is over, many industries will be bringing employees back to work or rehiring. In the long run, it could be more cost-effective to keep employees on the payroll rather than laying them off.
Keep reading to learn more about how high employee turnover creates long term problems for a company.
Turnover is expensive
“A study from the Center for American Progress determined that the average cost to a company of losing a highly-skilled employee is 213% of their annual compensation.” Employee turnover is expensive whether it’s one employee or many on a regular basis. It often leads to a loss of revenue while the position is vacant. Your team can pitch in to cover the void, but teamwork still doesn’t equal an extra person.
When an employee leaves a company it’s sometimes like getting a divorce-- and it can get ugly. There are mediations or lawsuits that can drag on for months or even years.
When it comes to finding a replacement, the cost of recruiting and then training a new person can be high, and it can be somewhat painful if you weren’t planning on hiring a new person just yet.
Company performance hurts
Losing employees affects the overall performance of the company. It disrupts operations and workflows that are already delicate in a lot of enterprises. It not only reduces manpower, but also, most definitely hurts morale. People may not mind pitching in when they are a person short, but this can be emotionally taxing no matter the good intentions. And, employee turnover inevitably affects productivity. You just can’t accomplish all of the things you need to when you are missing people that are critical to getting the job done.
Recruiting the right employees
When employees leave a company they almost always need to be replaced right away, but getting that done is almost never a reality. Recruiting websites make it sound easy to post an ad and find the right people, but that is only the beginning of the process. The right person for the job most definitely exists, but it’s finding them that can be challenging for most companies. Also, most top talent are already happy in their current roles, so you’ll really have to woo them to get them interested in making a career change.
How to retain employees
Don’t wait until you are facing vacancies, work to retain top talent now. It’s very important to track job satisfaction and engagement for one thing. Making this part of a regular workflow could pay off by allowing you to see disenfranchisement when it’s coming--or to prevent it! This also gives you an opportunity to gauge areas that employees would like to grow in. When people feel like you are behind them and supporting their professional growth they will be loyal and much more likely to stick around. Finally, work to create a supportive company culture. This is a big one because most people cite a toxic work environment for their reason for leaving. If just going to work is an unpleasant experience, most people won’t want to come back.
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