8 Factors That Greatly Influence Employee Retention
It’s already challenging to hire top employees, but keeping them is even more complicated. Just think about the expenses you will save when you don’t have to spend on frequently advertising job postings and recruitment agencies.
Not to mention the money, time, and effort you will need to spend on screening, interviewing, hiring, and training new employees. These expenses might seem small initially, but they add up eventually, especially if your employee turnover rate is high.
The bottom line is that having a higher retention rate can increase a company’s earnings by up to four times.
Of course, before you start creating programs and plans for employee retention, you’ll first need to understand the factors that have an enormous impact on it. Read on below to find out!
- Flexibility
You’ve probably heard of this word so many times before. Flexibility is a corporate buzzword, and for a good reason. As remote working gains hold, employees are clamoring for flexibility around appointments, life events, and more.
As flexible working arrangements become the standard, employers who do not consider flexible working options might not attract top employees. Modern workers simply don’t want to remain within the old 9–5 limits and will start seeking elsewhere.
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2. A Clear-Cut Employee Purpose
Companies with clear objectives enjoy lower turnover rates. With “purposeful missions,” these companies excel at engaging their staff to the point that their people become extensions of the brand itself.
These companies have strong cultures, understand how their product or service improves the world, and “walk the walk” when supporting philanthropic organizations and giving back to the community.
Even firms with low employee engagement may retain talent if their employees believe in their mission and purpose.
3. A Well-Defined Career Path
Whether new or seasoned, employees want to know how an organization’s leadership can help them advance. In addition, they want to see concrete examples of how their counterparts have progressed within the company.
Rather than being sandboxed into one job function, the young workforce prefers to gain early experience doing various tasks. As a result, businesses must provide well-defined career pathways that include a “diversity of work” that motivates employees to stay with the company.
4. Proper Compensation
This pretty much goes without saying; the most critical aspect of the employee retention strategy is compensation. Employees have high expectations when it comes to their remuneration packages.
For several reasons, higher base pay significantly influences employee retention. First, properly compensating your people demonstrates your appreciation for their work. It also makes it less likely for a competitor wanting to poach your top performers to use merely financial incentives to lure them away.
5. Great Work Relationships
Supervisory management support and coworker relations are two work relationships that affect employee retention. A supervisor or manager builds positive relationships and aids retention by being fair and non-discriminatory. This means allowing work flexibility and work-life balance, providing feedback that recognizes employee efforts and performance, and supporting learning and development.
Many people form close bonds with their coworkers. Although work-related friendships do not appear on employee records, they can be a significant indicator of a pleasant environment. Overall, this suggests that employee retention is influenced not just by where individuals work but also by who they work with. Employees who are not connected to or relate to their coworkers are more likely to leave. So don’t forget to plan team-building activities to strengthen their relationships.
6. Work-Life Balance
Not only does giving importance to personal well-being through work-life balance aid in the increase of work productivity, but it also helps prevent your people from walking out that door.
Employees no longer want restrictions that prevent them from doing what they want. This is why remote work or flexible work arrangements are an essential retention tool, and work-life balance should always be a top priority. Any manager who fails to take this into account will quickly find themselves in hot water.
7. Well Laid Out Hiring Processes
If your company is experiencing low short-term retention rates, it’s time to look for issues in your hiring and onboarding procedures.
You have a short-term retention problem when employees leave within the first six months, especially to take up lateral roles at other companies. A high termination rate might also indicate issues within the hiring process.
8. No Room For Burnout
Employees become burned out when asked to perform tasks without being provided the tools they need to succeed. It also happens when they feel a lack of control or when they are subjected to excessive daily stress. Burnout is a combination of mental and physical tiredness, discouragement, and self-blame that can manifest in behavioral and physical issues.
It’s important to ask yourself the following:
- Do we require or expect staff to work on weekends or after hours on a regular basis?
- Is the typical “normal” workweek 50 hours or more?
- Do we provide individuals with the necessary technology and other resources to succeed?
Keep Your Employees By Giving Them What They Need
We understand that keeping your employees happy isn’t always easy. However, doubling your retention efforts need not be as difficult as you imagine it to be. The factors we listed above depend on one simple thing: your ability to address your employees’ needs.
Once you put your employees first in everything you do throughout the workplace, employee retention will come naturally.
Of course, if there are tools available to you, don’t hesitate to take advantage of them. For all the tools your team needs to manage projects effortlessly, ProofHub has all your work management needs covered! Start your free trial today.
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