According to the Bureau of Labor Statistics, US Department of Labor, the median number of years that salary workers have been with their employers has been consistently coming down over the last few years (hovering around 4 years), with ‘voluntary quits’ far outpacing layoffs. This holds particularly true for younger employees. The global management-consulting firm, Hay Group, found in multiple studies that employee turnover in the US has been slowly increasing since the 2012-13 period, and has reached the pre-recession levels. While high turnover is a harbinger of an improving economy, it also poses significant challenges for employers to retain top talent.
As options for talented workers improve, what can you as a business owner or a manager do to ensure that your best employees stay and grow with you over a long period? From our experience, we have a few pointers that might help you make work conditions better and keep your employees from looking for greener pastures elsewhere.
- Train your managers – Employees often don’t quit jobs, they quit their managers. A good manager makes the employee feel nurtured, provides clarity on expectations and provides a wholesome framework for the employee to succeed. The quality of supervision has to be firm, but never suffocating, and is critical to how healthy the employee’s relationship with the manager, and, in turn, with the firm is.
- Provide practical benefits – In a job market that primarily competes in terms of pay packages, truly practical benefits can give the firm an edge in making it attractive to employees. These can range from health insurance (that doesn’t involve claims that take ages to settle) and greater freedom to attend important family events to good meal options and dog-friendly offices. Great benefits can also be useful for startups to retain talent, when they aren’t in a position to compete with large firms on the remuneration front.
- Create a stimulating work environment – Given the increasing amounts of time that employees spend in the office, it helps to make it a welcoming place. Open plan has been all the rage in recent times, but research reveals that many office workers prefer their own space to work in a relaxed manner and avoid distractions. A café for occasional breaks and mixing with staff from other departments, a small library to relax in with a magazine, or a gaming room to de-stress are just some of the options you can consider, depending on your budget and, of course, the type of work your employees are engaged in. An equally important factor is to choose an office location that doesn’t make it a daily chore for employees to commute from their homes.
- Allow for work-from-home options – Paired with the above point is the option of flexible work hours or telecommuting. Equip your teams to collaborate seamlessly from anywhere. Remote working reduces office overheads, gives you the chance to hire from a wider pool of workers and allows coverage across time zones. It also makes workers generally more productive, while giving them more free time (saved from commuting and other office distractions that eat up one’s hours) and a feeling that they are trusted.
- Reward good performance – Recognition for good performance is the prime motivator for continued excellence. But many firms stumble when it comes to ensuring this, probably to avoid appearing biased. Rewards can be in the form of bonuses and promotions, or more qualitative, like increased access to the firm policy making system or an article in the company newsletter.
- Connect employees’ work to the larger picture – Regular feedback that helps employees be clear about the firm’s expectations is essential for a sense of engagement. Having a specific framework to work within helps employees avoid unhealthy stress, and knowing that the work they are doing is directly benefiting the firm ensures long-term job satisfaction. Being aware of the challenges the company might be facing also goes a long way in them being able to adapt their expectations from the company.
- Listen to your employees – Instead of learning about your talented workers’ grievances in an exit interview, it is a lot more practical to engage with them while they are working with you. One-on-one sessions in the office or frequent team outings can keep you connected to your employees’ needs and aspirations, and, in a way, provide you the best ideas to implement all the other employee retention pointers mentioned above.
Retaining your best employees is important for customer satisfaction, consistent sales, satisfied co-workers, efficient succession planning and deeply embedded organizational learning. Failing to retain them, thus, has a direct effect on your firm’s bottom line. While some of the steps above may appear costly, the value of your best employees staying with you for a long time far outweighs the cost of any investment you might have to make.