At some point, a job seeker felt excited, energized, and motivated about the opportunity to work for your company. And at some point, they lost that excitement, energy, and motivation.
And then they quit.
Employee turnover is perplexing, frustrating – and costly. Very costly.
Access Perks, a company that provides employee discount program geared for small- and medium-sized businesses, gathered this data, proving just how costly employee turnover can be:
- $11 billion is lost annually due to employee turnover (Bloomberg BNA)
- Millennial turnover costs the U.S. economy $30.5 billion annually (Gallup)
- Cost of replacing entry level employees: 30-50% of their annual salary (ERE Media)
- Cost of replacing mid-level employees: 150% of their annual salary (ERE Media)
- Cost of replacing high-level or highly specialized employees: 400% of their annual salary (ERE Media)
“No one takes a job already thinking about when they’re going to quit,” says Heather Huhman, an experienced hiring manager and President of Come Recommended, a content marketing and digital PR consultancy for job search and human resources technologies. “In most cases, new hires are excited about the new opportunity. The issue begins when they start to wonder if their current position is the only opportunity for them within your company.”
Below, we look at 5 reasons your company has an employee turnover problem:
Reason #1: Lack of development/advancement
Recent research by LinkedIn shows that the number one reason people change jobs is because they don’t see a chance to develop and advance their career with their current organization. How do you let employees know they can advance within your company without offering undue promotions or raises?
The answer is career path transparency.
“The reason employees begin to doubt whether or not they’ll be able to advance their career is that they have no guideposts to follow,” says Huhman. “They don’t know what skills you’d like them to develop or the amount of experience that would be necessary for them to be able to take the next step. So they have no idea how they’re progressing or if the organization is recognizing it.”
Reason #2: Lack of communication
Open discussions and transparency about advancement opportunities are a must.
“Find out what their individual goals are and begin to form a plan on how they can achieve them,” says Huhman.
Discuss the training options they can take, as well as more experienced employees they can turn to for advice. Then regularly check in with employees to talk about the progress they’re making.
“This will give them a reason to stay with the company, which means you avoid the high costs of constantly rehiring and retraining new employees,” says Huhman.
Reason #3: Disconnect with managers
“I’m shocked at how few hiring managers meet with their employees on a frequent basis,” says Mazzullo. “Employees want to be assured that they are valued and connection and communication are integral in making this happen.
Don’t discredit the positive impact of a scheduled one-on-one meeting in-person on a frequent basis, she says, “it will help you build a stronger rapport with your team.”
Reason #4: Managers don’t value employee feedback
“Strong hiring managers are humble enough to receive feedback and are nimble enough to think creatively in order to satisfy the desires of their employees,” says Mazzullo. “Listen to the input. Take their feedback. Make changes. Get creative. Make positive things happen for your employees. Initiate. Don’t wait until they ask you 10 times. Get things done.”
Reason #5: Blaming the employee
When someone resigns, employers must be willing to ask themselves these questions, says Mazzullo:
- What did we do wrong?
- What can we do better?
- How could we have retained this person?
“Without that intellectual curiosity and willingness to improve, nothing changes,” says Mazzullo. “Employers must recognize that they can’t control all resignations, but much turnover is due to things that could have been controlled.”
Start following these tips and you will do what’s most important: Retain your employees.