Retaining talent is highly important for the success of every startup. In this article, you will learn how to retain talent and reduce employee turnover.
Employees in an organisation work together to achieve a set of goals. So, the more talented and hardworking employees an organisation has, the easier it is for that organisation to achieve its goals.
Employee retention overview
According to the latest job opening and labour turnover summary by Statista, approximately four million employees left their jobs in the US in 2022. Finding top talent can be difficult, so every employer should strive to retain them for as long as possible.
Employee retention is important because it reduces the cost of hiring and training new employees. It also makes your startup a desirable place to work because employees feel more invested in their jobs. If your startup doesn’t have a good retention plan, it might lose some of its best employees.
What is the average employee retention rate in the US?
According to the Job Openings and Labour Turnover Survey (JOLTS), the overall turnover rate is 57.3 percent, but it drops to 25 percent when only voluntary turnover is considered, 29 percent when involuntary turnover is considered, and three percent when only high-performers are considered.
Employee retention rates of 90 percent or higher are considered good in general, so a company should aim for a turnover rate of 10 percent or less. An employer’s inability to retain personnel is influenced by the following factors:
- Inflexible work hours;
- Limited opportunities for training and development;
- Ambiguous job descriptions that fail to clearly define responsibilities;
- Communication barriers between management and employees;
- Failure to acknowledge or appreciate an employee’s work;
- Inability to provide constructive feedback on performance issues.
Importance of retaining talent
Companies that truly understand the importance of retaining talent know that it is necessary to invest time and resources in identifying, recruiting, and training talent.
Losing a good employee is a big loss to startups. Retaining talent will bring numerous benefits such as:
- Greater work efficiency;
- Increased work performance;
- Increased customer satisfaction;
- Improved company’s culture and philosophy.
Talented employees will always be attracted to established companies with more resources, a more secure future, and better benefits packages. If you want to keep top tech talent on your team, you need to create a culture that they want to be a part of.
In today’s competitive job market, keeping your employees happy and engaged is critical to your company’s success. Retaining top performers will also help you to avoid losing your most valuable workers to competitors.
In retaining talent, it is important for startups to understand the reasons employees leave or might be considering other opportunities so that they can address their concerns. By conducting exit interviews with departing employees, startups can get a better sense of what their employees are experiencing in the company.
Then, they can use this information to identify the areas that need improvement to make the work environment more desirable for current employees.
It can be difficult for startups in retaining talent, but there are steps they can take to make sure that their team keeps growing and stays happy. In the sections below, we will explore how startups can retain employees, as this is very important to their growth.
Good hiring process
There is a lot of value in having a good hiring process, and one of them is the fact that it will help your company retain employees. It is important to hire the right person for the job from the start to avoid problems and turnover in the future. Therefore, that requires a hiring process that evaluates candidates thoroughly and fairly.
It also requires a hiring process that is open and honest with new hires about what they can expect from the company itself. An employee is more likely to leave if they aren’t the right fit for the company. It is very important to look beyond the candidate’s professional skills and background during the hiring process.
You must consider whether the candidate fits your company’s culture and values. You can also look at their work history to get a sense of their career goals. If a candidate has had six jobs in the last three years, it may indicate that their time with your startup will be short.
Ask relevant questions
When retaining talent, employers must understand what their employees want to provide them with better opportunities like businesses must understand what their customers want. The best way to achieve this is simply by asking questions.
You can start by regularly scheduling one-on-one meetings with each team member. Inquire about their strengths and weaknesses, as well as their current tasks. Employers should also inquire about any areas or tasks that their employees are having difficulty with. Some questions you can ask your employees are:
- Are you currently working towards your short, medium, or long-term objectives? How? If not, why?
- What are the favourite aspects of your job? What do you enjoy doing the most and least?
- Is there anything else you’d like to do in the company?
- What would you like to learn about the company?
- Which positions do you aspire to obtain within the company?
As employees answer these questions, it is important to actively listen to them and be empathetic. It is also good to reaffirm what employees say in meetings in your own words to ensure that you fully understand what they are saying.
Create an effective learning environment
A learning environment is an environment where people are engaged in active learning. This means that they are seeking out new information, skills, and knowledge to help them grow both personally and professionally.
Creating a good learning environment is a great way towards retaining talent, as it will keep them engaged and interested in their work.
A good way to create a learning environment is to give your employees a chance to experiment with new ideas and tools. This will allow them to learn something new and expand their skill set, which will make them feel more invested in their job.
Provide training and development opportunities
Employees crave growth and want to feel like they are moving forward in their careers, and a good way to do this is by providing them with training and development opportunities.
Offering on-the-job training programs is a sure way to keep employees motivated. Coding bootcamps are also ideal alternatives to improve the performance of employees.
Bootcamps such as General Assembly have special programs for companies like courses oriented to program management and IT systems management in companies. Whatever the training you provide, it will keep employees engaged with the company and on track with their career goals.
Not only does this make employees feel good about their jobs, but it also makes them more knowledgeable and competent in their jobs, which makes the company more efficient and productive.
Offer promotion possibilities
Promotions lead to increased job satisfaction, higher compensation, and a stronger sense of belonging. Offering promotions also increase workplace morale because people know that their hard work is recognised and that they can advance in their position.
Promotions are important for career development, and they are also a great way for retaining talents. When people feel that their career is going nowhere and there are no opportunities for them within their current role, they may start looking for other jobs.
Promote good communication
Communication is key when it comes to retaining talent. If your workers feel like they aren’t heard or don’t believe in what the company is doing, they are likely to leave.
It is important for startups to have a healthy work environment where people can express their thoughts and opinions without any fear.
There are many benefits to having good communication, such as improved collaboration, better problem-solving, increased productivity, and more.
Communicating with your employees also entails informing them of their duties. Setting milestones and timelines for your team members and checking in with them on a regular basis to ensure they are on track can be beneficial.
Deliver positive and constructive feedback
Delivering positive feedback helps reinforce good behaviours, and lets employees know that they are appreciated. However, it’s also important to deliver constructive feedback, especially when it comes to areas for improvement. Feedback is very valuable, and it begins with establishing clear objectives.
Giving your employees regular genuine and effective feedback will help them to grow, and it will also help your company to retain them. Feedback has many benefits, but one of the most important is that it will help your employees feel more engaged and appreciated.
When employees feel appreciated, they are more likely to stay with your company, and they will also work harder to help your company succeed.
Create a positive work culture
Company culture refers to the set of values, norms, and goals that shape how a company operates. Company culture is important because it shapes the way your employees work, their morale, their productivity, and the way your customers are treated.
A positive company culture improves employee engagement and retention, which in turn improves your company’s productivity.
Employees seek satisfaction in their careers beyond professional obligations. The environment they work in is a very relevant factor to them. If they work in a positive, enriching, respectful, and friendly environment, they will be less likely to seek other job opportunities.
Organisations with a toxic culture experience a much higher turnover rate. Here are some things you can consider to improve organisational culture:
- Conduct corporate culture audits;
- Celebrate and recognise employee achievements;
- Identify and eliminate toxic practices;
- Encourage teamwork and team mentality.
Provide great benefits
Remuneration is not the only thing that employees value. According to a SAHRM study, 91 percent of workers feel satisfied with their jobs because of the benefits and bonuses.
Great benefits don’t always need to be expensive. Even small perks, such as free coffee and snacks, can boost morale. On a larger scale, offering vacation, holidays, and additional leave can help retain an employee.
There are different benefits that you can offer your employees, but ensure you provide the ones that are valuable to them. For example, you might offer a gym membership to your employees, but if they don’t use it or if it’s far away from the office, then it’s not that valuable to your team.
You can ask them directly or observe their behaviour to learn more about their preferences. Then, you can tailor your company’s benefits package to meet the needs of your employees.
Retaining talent can be difficult, especially in the great resignation era. Countries like the US, Canada, and the UK need efficient plans to build strong teams. Follow our advice above and get ready to hire and retain the best talent in the market in your startup.
About the Author
David Torrealba started working with Career Karma in October 2020. He has a Bachelor’s Degree in Social Communication and Print Journalism from Universidad del Zulia. He works as a journalist at Noticia Al Minuto alongside his content writing duties with Career Karma.