Why is staff retention important

Beyond basic employee engagement, staff members who have been around longer will more likely be able to solve complex or unique problems more quickly and confidently, which saves time, reduces work for others, and prevents lost business from unhappy customers. Turnover is expensive.

Everyone involved in hiring and training knows how quickly the hours can rack up - particularly if the position goes unfilled for a while. Employees constantly moving in and out mean potentially significant costs associated with:.

Depending on the role you are replacing, turnover costs can range from uncomfortably high to truly shocking. High turnover is particularly destructive because businesses end up paying these costs time and time again — sometimes even multiple times a year. Employee retention can drastically reduce these expenses. Millennials overwhelmingly consider career development opportunities to be one of the most important elements of a company.

However, only half of employees in a recent study said their employers provide career development opportunities that meet their needs and chances for advancement. People have a natural desire to grow and move forward, and making opportunities for them to do that by developing their careers is a fantastic way to boost retention. An attractive healthcare plan is an ideal strategy for recruiting and retaining high-value employees.

However, offering improved health benefits is also relatively expensive. HR team members have a lot of power to do good in this instance. Incentivize employees to adopt healthier lifestyles or achieve fitness goals. Naturally, raising salaries is not an inexpensive strategy. The study found that the happiness and satisfaction generated by the thrill of a raise lasted more than a week, but still less than a month.

One possibility that's interesting to consider is that regular evaluations and raises may be seen as more of a plus when they're part of a proactive and robust employee retention strategy.

Second only to healthcare in importance to employees, a retirement plan is hands-down one of the best ways to incentivize employee retention. A MetLife study found that retirement benefits were a key to earning employee loyalty. In fact, four in 10 employees said retiree benefits are a strong reason to stay with their company. However, there is a major caveat to k retirement plans — they have to be well-run. A healthy k optimized for employee retention has high participation rates, an emphasis on accessibility, a clear and scheduled onboarding process, and access to personalized financial advisory services.

And all that comes down to HR. In fact, an optimized k can actually save money for everyone involved, and be a lot easier to manage than you might have thought. This strategy covers a broad range of potential employee benefits and tactics - like leave benefits, flexible working benefits, wellness benefits, and family benefits. Wellness and a good work-life balance are about providing your employees with the tools they need to be happy in their job and thus much more likely to stay.

These types of initiatives can include:. Wellness and work-life balance initiatives help your employees live full and satisfying lives beyond their employment. More interviews? Just when we were solving the turnover crisis? Stay interviews are one of the most direct and hands-on forms of employee retention in this list of strategies.

Want to know what you can do to make sure you are focusing on retaining your employees? Just ask. In essence, a stay interview is a conversation between employee and manager about what makes the employee keep working for you. That figure rises to as much as percent when replacing leaders or highly skilled employees. A key part of this expense is onboarding, the critical process of helping a new employee learn their job and fit into their new company culture.

This calculator tool can help you determine the onboarding cost for a new hire in your firm. Losing people means losing knowledge. Whether you call it institutional knowledge, enterprise knowledge, or something else, important information and skills can be lost forever if experienced employees leave without thoroughly transferring their knowledge to others. Teamwork is tougher with high turnover.

Employees can have a hard time bonding with each other and working productively together if team members keep leaving. Employees who leave your organization may go work for a competitor who will benefit from their skills and potential—assets you have lost.

How to Increase Employee Retention You might assume that all it takes to reduce turnover is to increase wages, but most employees today want more than money. Create an employee retention plan document that includes: Turnover rates Employee feedback Goals and how to achieve them Task calendar Budget This article has more detailed information about how to develop and administer a successful employee retention plan.

The organization and management should understand the difference between a valuable employee and an employee who does not contribute much to the organization. Sincere efforts must be made to encourage the employees so that they stay happy in the current organization and do not look for a change.

An organization invests time and money in grooming an individual and make him ready to work and understand the corporate culture. Why Does Employee Retention Matter?

Retention and engagement The importance of retention is not just to minimize cost—is also offers opportunity to increase sales and employee morale. Want a PDF of this guide for free? We'll email you a copy. Send me the guide! Previous Chapter Next Chapter. Try Bonusly and start supporting great work. Try for free.