If you’re wondering how to reduce employee turnover, chances are you’ve struggled with retention issues in the past in some capacity. Building teams of talented, engaged employees takes time and effort—when people begin leaving and voluntary turnover goes up, businesses are left scrambling and covering unexpected costs. To avoid this pricey frustration, proactive and ongoing measures are required to lower turnover rates and restore organizational health.
In this article, we take a look at seven ways to decrease turnover in the workplace. We’ll start by exploring some of the underlying causes of turnover, in order to find smarter solutions with a more robust understanding of what works and what doesn’t.
What Causes High Employee Turnover?
There are many reasons why employees may leave one workplace for another. Not all of them will be negative—for example, if an employee wants to shift careers or industries. That said, causes of voluntary employee turnover, from dissatisfaction to downright anger, can be greatly reduced with proper foresight and retention strategies on the part of the company.
Some of the causes of a high voluntary employee turnover include:
- Mismatched Expectations – Broadly, if employees and employers aren’t on the same page there’s bound to be friction and an increased chance of turnover. Managing expectations starts with setting clear job responsibilities, goals, and performance tracking in one-on-ones or peer reviews.
- Poor Work/Life Balance – Employees who consistently have to work extra hours, or contrarily feel always short on work, will be more likely to feel dissatisfied and inclined to leave. This goes back to setting and reevaluating expectations to ensure alignment.
- Lack of Recognition – This includes a lack of fair compensation and good benefits, along with feeling underappreciated. Emphasize frequent, quality feedback from both managers and peers.
- Lack of Opportunity – No one wants to feel limited, stagnant, bored, or frustrated at work. Look for growth opportunities for team members and encourage dialogue around actionable goal-setting.
As you can tell, causes of high turnover rates tie together and overlap in a web of cause and effect. Every situation will have its own unique dynamics, though the main thing is to first identify the why behind why employees are leaving. This helps companies know how to respond and adjust to create better workspaces.
Why Is It Important to Reduce Employee Turnover?
Not all companies may see turnover as a primary issue, and it may be something only minorly affecting operations. People switch jobs every few months; that’s just how it is in some industries. Right?
Well, yes and no. Turnover is expensive. In fact, it can cost as much as twice the amount of an employee’s salary to hire a replacement when you factor in the costs of recruitment and onboarding. Even in big companies with large teams, a constantly shifting group of employees decreases productivity and makes it harder for everyone to feel connected to their work and fellow employees. Plus, high turnover rates may start to damage your company’s reputation, making it harder to acquire talented individuals down the line.
How Can Employee Turnover Be Reduced?
So how can companies decrease turnover and make employees feel more at home in the workplace? On the most basic level, it’s important for employees to be connected to their roles, coworkers, managers, systems, and the company itself. As mentioned, managing expectations is part of this process, from the interview and onboarding stages to the day-to-day responsibilities and year-end reviews.
Reducing employee turnover, then, requires a strong foundation and sustained organizational momentum. While employees may legitimately not be a good fit in a role or on a team, there are plenty of instances where the situation could be alleviated. Below are seven strategies to reduce employee turnover.
1. Create Accurate Job Descriptions
Employee retention begins with the job listing. Every company has its own policies and procedures when posting team openings, though transparency is critical in today’s competitive job market.
Be sure to include details about specific job responsibilities, expectations each week, benefits, workplace flexibilities (can employees work from home?), and the salary range(s) if appropriate. Representing your company’s culture and core values also helps, as potential hires will be looking to establish a connection with companies. Should they receive an interview, they will need concrete examples of how to envision themselves working at your company.
2. Invest in Your Interview Process
There’s a fine line between creating an interview process that’s too lengthy and one that’s too brief. Investing in your interview process helps you find that sweet spot when assessing and speaking with candidates for compatibility.
Plus, potential hires can sense internal company organization during an interview and will be, hopefully, more enthusiastic and engaged in return for your effort. Consider incorporating the following elements into your company’s hiring stage to lower turnover rates and build strong, harmonized teams.
- Incorporate work samples, especially for creative, output-focused roles.
- Mix in both team and individual interviews for a broader depth of perspective.
- Foster atmospheres of openness and trust—few interviewees represent themselves well in uninviting, hostile, or dispassionate environments.
- Set up in-person interviews when possible, even if the position allows for remote work.
- For the final stages of getting to know a candidate, consider a “shadow” interview, where candidates follow along with employees for part of the workday to get a deeper sense of the job.
Whichever criteria you use, selecting the right candidates for your team is crucial to reducing employee turnover.
3. Structure Your Onboarding Experience
With the right people through the door, it’s time to show them the ropes through onboarding, training, and meeting with the rest of the company. Make new hires feel included and excited for their new chapter in life!
Beyond this, be sure to provide employees with tools and tutorials to succeed. These tools include the software inherent to the job itself, as well as people management platforms like CentricityOne that help track engagement throughout an employee’s journey.
4. Compensate Appropriately
Fair compensation might go without saying, but we’ll say it again. Compensate employees appropriately for the work they do, based on your company’s models, industry standards, and personal best judgment.
And if there’s a mismatch between industry expectations and what you’re able to provide in a salary, consider expanding benefits like allotted vacation time, work from home flexibility, healthcare, and other perks. Don’t forget about team activities like an employee lunch or movie night that boosts satisfaction and morale.
5. Prioritize Company Culture
Company culture is the underlying glue inherent to many of the other tips on this list for how to reduce employee turnover. Just because culture involves the nuances of interpersonal emotions more than other aspects of business doesn’t mean it can’t be tracked, evaluated, and improved upon. Start by actively promoting diversity, equity, and inclusion in the workplace.
6. Continuous Performance Management
Feedback given and received continuously throughout the year is another great way to lower turnover rates. Every company will structure its performance management models a little differently, though the important thing is continuous feedback throughout the year from both managers and peers.
7. Focus on Flexibility
One of the silver linings of the ongoing and difficult COVID-19 pandemic has been the impact on workplace flexibility. More and more companies are realizing the benefits of allowing employees to work from home in hybrid, diversified environments.
Even if your company prefers a primarily in-person, traditional nine to five setting, consider incorporating some level of remote work flexibility for employees or in certain scenarios. And you might be surprised! Keeping remote employees engaged may be a challenge, but it also offers an opportunity to build new systems and bridge the gap between employer and employee.
Workplaces are closely linked atmospheres—increased flexibility builds trust in addition to boosting job satisfaction and engagement. These things are crucial steps when tackling the often daunting question of how to reduce employee turnover.
Final Thoughts on Reducing Employee Turnover
However you choose to approach reducing employee turnover rates, don’t be afraid to start small and work in new changes gradually. Large-scale restructuring has its perks at the right time but also introduces new challenges. Using some of the techniques and tools in this article, you should be well on your way to successfully reducing employee turnover! Identify common pain points and possible areas of improvement in your organization, meeting with both leadership teams and staff along the way to get a pulse on what is or isn’t working.
At Centricity, we’re dedicated to building workplaces centered around employee engagement and satisfaction. Elevating experiences at work leads to a more creative and organized atmosphere for your staff, company, and clients. Get in touch with us today to learn more about creating custom brand solutions, whether that’s through workforce technology, event planning, branded merchandise, or something in between.