Recent data* predicts that UK firms may experience employee turnover as high as 35% in 2023. Whilst this differs by industry, replacing and training employees represents the single greatest cost to businesses at an average of almost £8,000 per employee*. Additionally, high staff turnover harms customer service and performance since it creates sizable gaps in organisational resources and knowledge. Employers plagued with mass staff losses risk alienating remaining employees and creating an unstable environment deterring future talent. Conversely, organisations that retain staff at greater rates are healthier and more successful. Leaders can start by understanding better what drives employees to leave or stay.
Employees leave for a multitude of reasons. By conducting exit interviews, you may understand why. These may include a lack of progression opportunities or seeking more work-life balance, for example. But do employees really tell you their reasons for leaving? They are likely to avoid giving the real reasons out of fear or apathy. Furthermore, it is often too late to change their mind once they are halfway out of the door.
At the beginning of the relationship, employers can mitigate high staff turnover by increasing the quality of their recruitment methods. Individuals are more likely to stay in a role where their skills and strengths are both fully utilised and stretched. Consider methods beyond an interview to assess fitness for the role such as work tests or trials. Take time to understand if the organisation’s purpose and values align with those of the individual. The effort invested at this stage will likely increase employee retention.
Early intervention and regular career conversations, where employees feel fairly treated, help stop employees from leaving later. For example, individuals want to receive a fair wage in proportion to the work they do. This alone won’t stop employees from leaving in big numbers, however.
Understanding your employees’ psychological contract perceptions will go far in improving retention. This is what they feel they should receive in return for working for you. This ranges from rewards, conditions, flexibility, career progression, and autonomy to name a few. Leaders and managers equipped to create better individual conversations are likely to experience greater retention. Whilst listening will not be enough, managers will need to provide against the set of criteria. Where this is unfeasible give a transparent rationale or pose alternatives.
Assets like employer branding and surveys can support overall retention. It is however imperative that these are congruent with HR practices. For example, results are shared transparently and acted upon swiftly with rigour.
Additional to HR Management practices there are other factors to be aware of. For example, work engagement (dedication, rigour, and absorption) can be increased by managing job demands such as overloading employees and conflict. Similarly, job resources can be increased to support the employee including teamwork and line-manager support. Employees can evolve their behaviours to improve how they meet the demands of the job, reducing tension.
Similarly, employees experience greater motivation to stay if their intrinsic needs are met. Many of us feel motivated when we experience belonging, competence and autonomy within our work. This means a connection to our work colleagues, that we are skilled and empowered to do our work and have the freedom to do it with our capability.
Final takeaway tips for leaders:
- Integrate retention into all strategic priorities and processes
- Be prepared to accept criticism to evolve your workplace in order to succeed
- Create high-performing teams where employees want to stay by creating psychological safety
- Ensure you balance job demands with job resources to avoid employee burnout
- Use employer branding and surveys with extreme care
To find out how The Contented Workplace can help you keep your best employees grow your businesses performance and reduce costs book a no-obligation call
*HRReview.co.uk
See also GEORGE, C., 2015. Retaining professional workers: what makes them stay? Employee Relations, 37(1), pp. 102-121.