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With news of ongoing hiring difficulties, losing quality employees is a problem you may not want to have at this time. In one conservative estimate, the cost of replacing an employee could range from one-half to two times their annual salary. That means if your employee's salary was $40,000, it may cost your business up to $80,000 when they leave. That's why it's important to guard your investment by concentrating on retention strategies. Look at these ideas to determine what you can do to avoid losing your employees – your most valuable asset.
What Causes Employees to Leave?
In a pre-pandemic year, more than 68 percent of small and medium-sized businesses reported employee turnover. And over the past year, there was a 20 percent increase in employee turnover for small businesses – largely attributed to COVID-19. According to a Capterra survey, some of the top reasons cited by people who quit their jobs include poor compensation and/or benefits, their manager, lack of work-life balance, limited career progression and company culture. The huge lesson from this study, however, is only one reason included money. Even though it's important, there are lots of opportunities to address retention without costing you your budget.
5 Ways to Keep Your Best Hires
So, what are the reasons that cause employees to stay at their jobs? The top reasons are:
While you should examine the circumstances affecting retention that may be unique to your business, here are 5 ideas to get you started.
It begins before they're hired.
Start before your employee's first day of work. Some of your action items during the hiring process include ensuring the job description is an accurate reflection of the work they'll be doing. In some cases, businesses have candidates interview with current employees for first-hand experience. You could also give the applicant a taste of the job. For example, if the candidate is applying for a sales position, they might tag along on a real call with one of your salespeople.
Regular check-ins through stay interviews.
Unlike conducting exit interviews to collect information when an employee quits, ask your existing ones through “stay interviews.” The intent is to learn the reasons why they're staying – valuable research when it comes to deciding what will have a significant impact on your retention plan.
Try and incorporate these interviews in your weekly one-on-ones or through an anonymous online survey.
Give them a way to develop their career.
At the top of reasons why younger workers leave is limited pathways to progress in their careers. To help them grow their skills, consider providing them with opportunities to develop.
There are a number of ways to provide development without breaking the budget. For example, let your employees go through online training during business hours and use one-on-one sessions to determine what skills they need to cultivate to take on other, more difficult assignments.
Instead of focusing on the negatives, consider a more productive angle when observing your employees where compliments of a job well done are regularly dispersed as appropriate. The takeaway here is to provide immediate acknowledgment, providing details on what was done correctly.
Other ideas include employee-of-the-month, a coupon for a couple of hours of free time, a special parking spot, and a shout-out. Keep in mind that these rewards should be based on the individual employee. Give them an option to opt-out if they aren't into public recognition.
There's no such thing as one method fitting the needs of all employees. Try being amenable to individual needs whenever possible. In most cases, your employees will understand that not every request may be approved. However, it doesn't have to be complicated. For example, you could allow your staff to work an earlier shift so that they could attend their child's soccer game. Another option is allowing your employee to work from home once a week.
With the amount of effort that goes into hiring an employee, it's logical that as much, if not more energy goes into keeping them. Consider these ideas to enhance your chances with employee retention.