Keeping employees and making them happy is not an easy task, but it is one of the most important components of success. In this article, we explain how to get better employee retention.
In 2023, researchers surveyed over 20,000 employees and found that the following factors motivate them the most:
Higher salaries and benefits (70%)
Work-life balance (75%)
Matching work to their talents and strengths (65%)
As you can see, salary is only 5% more important than work-life balance, and only 10% more important than work-talent balance. Many employers think that the only way to keep employees is with a high salary, but this is not the only way.
In this article, you’ll find reasons why employees quit and tips on how to create a work environment that keeps employees from leaving for competitors.
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Why employees quit: top reasons
Hiring and training employees are not cheap. On average, companies spend almost $30,00 per employee, and if it doesn’t work out, the costs increase even more: employee turnover costs companies $15,000,000,000 a year. But why do people quit? Here are the most common reasons:
- Lack of opportunities for career growth. In 2021, more than 64% of respondents (more than 4,500 working adults) cited a lack of career opportunities as the main reason they left their jobs.
- Low salary. More than 75% of employees surveyed quit their jobs in 2022 due to low income.
- Ingratitude. People who don’t feel valued leave. More than 70% of employees said they would quit if they thought their hard work was not appreciated.
- Toxic company culture. Of the 1,500 employees surveyed who left in 2022, more than 35% cited toxic company culture as the top reason for leaving.
- Burnout. When budgets are cut and rates rise, people lose their work-life balance and therefore burn out. Often they are looking for a job with less stress. This reason is especially common among Generation Z and millennials.
- Management problems. More than 2,700 employees from 15 industries took part in the 2022 surveys. More than 63% of them blamed bad managers for their desire to leave the company next year.
- Lack of flexibility. In 2022, many have switched to remote work and have realised that it is not necessary to sit in the office all day. Employees are now more likely to leave companies that do not have flexible scheduling or the ability to work remotely.
How to retain employees: result-driven tips
Fortunately, retaining good employees is not Newton’s binomial. If you are the owner or manager of a company, you can improve the work environment with new systems, incentives, and tactics.
By developing your communication skills and improving the quality of your work with people, you can create a positive work environment. Here are a few employee retention strategies for companies of all sizes.
Invest in the professional growth of employees
Employees who see no future are less likely to stay at your company. At the same time, professional growth not only increases their daily productivity and engagement but also sets them a goal worth working for.
Professional growth creates a self-sustaining cycle of loyalty: the employer invests in his employees, showing that he values them and cares about their career; as a result, the employee learns new things, works for a promotion, and becomes more loyal to the company that invests in him.
Helping employees grow professionally is not that difficult. Here are some options:
- Conduct monthly workshops with professionals to help employees learn new skills.
- Establish funds to send employees to annual conferences for companies in your industry.
- Buy a useful book, which you then invite the whole team to read together.
- Develop professional and career development plans for each key employee.
- Organise a book club for employees.
- Conduct weekly exercises to improve communication skills or hire a coach for them.
Create a good work culture
Company culture is one of the most important elements of a healthy work environment. For younger generations of employees, the overall atmosphere in the workplace is especially important. It is very important to accurately characterize your company’s culture in order to attract the right employees.
For example, Lululemon Athletica is a Canadian casual sportswear corporation whose culture is based on the values of wellness and personal growth.
The company’s culture is evident in the fact that it organises free yoga and fitness classes, and personal growth coaching, and also offers healthy snacks in the break room. The culture of the company is also evident in the hiring process: they attract and retain employees who are passionate about exactly what the brand does.
Improve the recruitment and onboarding process
Often people quit jobs that didn’t suit them in the first place. The best investment in employee retention is creating effective onboarding for them.
Learn your recruiting, onboarding, and training strategy. Ask yourself:
- Is there a highlight in your company’s onboarding? Do you have, for example, special traditional greetings for new employees?
- Does your job description describe the job responsibilities correctly?
- Do you correctly evaluate candidates based on their personal qualities, enthusiasm, and capabilities?
- Is it interesting for a new employee to start work? Does it start quickly or sluggishly?
- Is it easy for employees to receive assignments?
- Are you hiring overqualified employees for positions where they are bored?
- Does initial training cover all possible work tasks and expectations?
Improving these aspects is critical to hiring the right people and helping them get started. The employee’s first impression of the company sets the tone for your future relationship.
Reward effort and success
While gratitude boosts morale, rewards help you focus on moving towards your goal. A 2021 survey showed that almost 73% of employees would want to stay in their current job if they received more rewards and recognition.
Achievement rewards can take the form of bonuses, promotions, gifts, team-building exercises, and outings. Here are some options:
- Invite team members to write a small message of congratulations to their successful colleagues.
- Give your employees branded gifts.
- Throw a small holiday party where your employees will be VIP guests.
- Invite remote employees to a virtual happy hour or cocktail masterclass.
Increase employee engagement and motivation
Employee engagement is directly correlated with employee retention: people like to feel that their work matters. The mission of the company should be important to them.
There are different ways to increase employee motivation, for example:
- Help them make friends with colleagues, such as setting up shared dining tables, keeping a calendar of birthdays, and creating holiday traditions.
- Support employees when they want to personalise their jobs.
- Interview employees regularly about how to improve their jobs.
- Find out the goals of each employee and praise them for their accomplishments.
Maintain a balance between work and leisure
When the balance between work and leisure is disrupted, employees are exhausted and stressed and work with less dedication. People who experience burnout usually want to change jobs, and this is especially true for Millennials and Generation Z.
Here are some ways to incorporate work-life balance into your company culture:
- Express meetings so that employees are not overloaded.
- An “open door” policy to discuss situations where work interferes with well-being.
- The ban on the discussion of work topics during lunch and in informal communication.
- Strictly defined working hours (especially for remote employees).
- Flexible requirements that allow employees to create their own schedule.
- Weekends for the whole company are all offline and no one feels obliged to check in at the workplace.
The balance between work and leisure in a company begins with its leader. If you are a manager or business owner and you miss your kids’ birthdays or text employees after hours, you’re setting a bad example.
Work environment communication includes all types of interactions, from handing out tasks to approving projects and receiving feedback. The style of your personal or virtual communication with the team affects its motivation, performance, and overall attitude towards work. When people do not understand their tasks or feel disrespected, they go in search of a better job.
The characteristics of effective communication are:
Respect. No matter who you are talking to, the tone is professional and respectful: no outbursts, harsh language, or condescending tone.
Conflict resolution. When problems arise, top management must have systems and methods to solve them. Managers should be solution-oriented, never point the finger at the guilty, or shift responsibility.
Clarity. Whether you’re sending an email or answering an unexpected question, your message should be clear and concise. You – do not waste time and effort on confusing instructions. Employees understand what they need to do, how, and when.
Bilateral interaction. Feedback is received from both managers and ordinary team members. Everyone is free to express their opinion.
Not surprisingly, gratitude programs reduce employee turnover by more than 35%. Nearly 77% of employees say they would work harder if their efforts were more appreciated.
The big problem is that not everyone perceives gratitude in the same way. So you need to determine how your colleague sees appreciation and what makes them feel valued.
People respond with sincere gratitude. For her sake, they come to work every day. Recognition is the fuel for the morale of any team. Gratitude allows the employee to feel like a valuable member of the team and creates an atmosphere of trust, teamwork, and recognition.
Employee motivation is closely related to feedback. According to surveys, more than 90% of employees want to receive feedback on the quality of their work more than once a year. In informal weekly conversations, you can discover and solve problems big and small as they come up.
If you are not already doing this, talk to each employee once a week. So that the employee does not feel pressure and speaks freely, you can communicate with him via Zoom or just walk up to him in the office. Ask each member of your team:
- How are current projects progressing?
- What support does he need?
- Do you need help and what kind?
Organise mentoring programs
A mentor program is one of the best tools for professional growth because it:
- Productive. By pairing more experienced employees with less experienced ones, you can increase the productivity of the entire team.
- Focused on work. You do not need to train employees outside the workplace: mentoring can be done daily or weekly while working on specific tasks.
- Relatively inexpensive. Surely you already have experienced employees who can take newcomers under their wing.
Mentoring can increase employee retention: newcomers feel they are being helped. At the same time, your long-term employees get a boost of enthusiasm because they can pass on their knowledge and experience to others.
Create wellness programs for employees
Investing in employee health can reduce healthcare costs and increase employee retention. The average ROI for an employee wellness program is 6 to 1 because employees take fewer sick days and are more productive.
A wellness program may include the following:
- Free medical examinations;
- Weight loss programs;
- Healthy food in the office;
- Personal coaches and training for personal growth;
- Training in rational nutrition;
- Group sports or gym memberships;
- Meditation app subscriptions;
- Smoking cessation programs.
If you help your employees stay healthy, they will perform better. Don’t forget to ask for their feedback and focus on the types of recovery that your team really cares about.
People stay in companies that are pleasant to work for. People are more likely to quit their jobs when they are bored or feel they are not respected or appreciated. To have better employee retention, do the following:
- Promote health and work-life balance. Prevent professional burnout: develop wellness programs and set a good example yourself. Healthy employees are less stressed, while happy employees are more productive and loyal to their company.
- Streamline the process of hiring and onboarding new employees. Improve your learning process and set a positive tone with every newcomer right from the start.
- Invest in the professional development of your employees. Offer opportunities for professional growth and show that career development is important to you.
- Increase employee engagement. Give them tasks that are really interesting to them and are given to them best.
- Communicate clearly and respectfully. Nobody likes rudeness.
- Make communication a priority. Managers at all levels must be able to communicate effectively so that people do not leave the company due to communication problems.
About the Author
Rakesh Donga is the CEO of MagentoBrain. Under his leadership, MagentoBrain has been focused on developing products and services, powered by the latest advances in Magento and Shopify, that offer help in commerce businesses.