We all know that turnover is expensive. The Society for Human Resources Management suggests that the average cost per employee is around $4K. This figure considers direct costs such as advertising, recruiting fees, and interviewing time. Costs travel even higher when including more non-direct items such as lost productivity, low morale due to increasing workloads for employees who stay, and the impact on customer service. Now the cost soars anywhere between $10K to $200K depending on the position. Such costs can have a definite and negative impact on profits. There are ways to overturn these expenses through better hiring practices, but after the fact there are also numerous ways to be more proactive about reducing turnover.
Be cognizant about why and when an employee may be ready to jump ship.
Toxic Relations: The relations here are one of the most important for an employee and that is the relationship with their boss. Having a poor boss, and thus the cause of the poor relations, is one of he main reasons people quit. Ensure that your organization maintains a culture of respect and one that values what every employee brings to the team.
Job Dissatisfaction: People become bored and unfulfilled when they are not engaging in challenging and meaningful work. Look for signs of withdrawal, late arrival, or low participation on the part of team members.
Advancement: Or better, the lack thereof. Employees want and need to grow. Neglecting training and development and succession planning is a huge mistake that leads to debilitating turnover costs.
Compensation: Sources rarely cite money as a cause for employee turnover. However, in a survey by PayChex, 69.44% of workers say that low salary is the reason for their departure. We may need to consider the source on this one – wink, wink. However, ensure that you are being competitive with pay, benefits, contributions, and other monetary offerings.
Communication: Just as respecting and valuing employees seems like a no brainer, so does communicating. It is always best to be open and transparent about what is going on in your organization. The rumor mill is a big destroyer of trust. Would you work for an organization you didn’t trust? You will never overturn turnover with a lack of trust infiltrating your organization.
As you can see from the numbers in the titles of the sources below, there are any number of reasons why people leave. In addition to the reasons, there are also times when people are more likely to consider leaving their jobs. These include work anniversaries, birthdays, and personal reunions such as school or family. At these times, people typically take stock of where they are in their life and career goals. If these goals are not being met, leaving may be a strong consideration.
Technology has begun to plan a large role in turnover prevention. For example, some companies may monitor their employee’s use of LinkedIn, social media usage in general, and even their patterns of entering and leaving the building. Some may consider this type of “surveillance” too much of “Big Brother is watching,” while others may consider it being proactive. Another option is Artificial Intelligence as an emerging science using predictive analysis to determine when certain employees might decide to head out for greener pastures.
Studying turnover has a long history. New research ideas are afoot such as studying why people stay and timing. For example, some cultures may leave at certain times whereas other cultures stay. Some people leave after what one source dubs “shocks.” Examples would be the birth of a child or if an employer asks an employee to perform some illegal act. Obviously, when dealing with people, there is always going to be unpredictable circumstances. Ensure your organization has good hiring processes, remains competitive, and train managers to be good leaders. While you may never completely overturn turnover, implementing these simple suggestions will at least help slow it down.
Graphic Credit: BigStock.com Copyright: DarkInk
Anonymous. (2016, August). Employee Retention: What Makes Employees Stay or Leave. paychex.com
Garland, P. (2016, September). Why People Quit Their Jobs. hbr.org
Heathfield, S.M. (2018, January). Top 10 Reasons Why Employees Quit Their Jobs. thebalance.com
Heathfield, S.M. (2017, December). Want to Know the 8Top Reasons Why Employees Quit Their Jobs? thebalance.com
Hebberd, L. (2015, April). 10 Reasons Why People Quit Their Jobs. theundercoverrecruiter.com
Lee, T.W., Hom, P.W., Eberly, M.B., Li, J., Mitchell, T.R. (2017, August). On the Next Decade of Research in Voluntary Employee Turnover. Academy of Management Perspectives. Vol. 31 Issue 3, p201-221. Retrieved from DeKalb County On Line Library.
Winter, T. (2017, October). 5 Predictors of Employee Turnover.dtsydney.com