What’s your company’s average employee turnover rate? Defined as the percentage of employees who leave during a specified period, it plays a critical role in your company’s long-term success. The higher your company’s employee turnover rate, the more resources you’ll have to consume on hiring and training employees. At the same, a high turnover rate can be demoralizing to your company’s active employees, some of whom will likely experience a reduction in productivity.
Employees often leave for reasons beyond the control of the employer or company for which they work. Maybe an employee is moving to a different state, or perhaps an employee wants to pursue a different career. While you can’t expect to retain all of your company’s employees indefinitely, however, there are steps you can take to lower its employee turnover rate.
Perfect Your Company’s Hiring Practices
Improving your company’s hiring practices can have a positive impact on its employee turnover rate. If you hire the wrong employees, they may quit or otherwise leave prematurely.
During interviews, ask candidates how long they plan to stay with your company. Alternatively, you can ask candidates where they see themselves X years from now. It’s a simple question that can provide insight into how long a candidate intends to stay with your company once hired.
Praise Employees for Their Hard Work
A little praise can go a long way in lowering your company’s employee turnover rate. Research shows that nearly two in three employees are likely to quit their job if they don’t feel appreciated by their peers.
Employees want to be noticed and recognized for their hard work. Turning a blind eye to your employees’ performance may result in shorter tenure. On the other hand, praising employees for their hard work encourages them to stay. They’ll feel more confident in their daily activities knowing that they are performing at a high level and that their hard work isn’t going unnoticed.
You can praise employees in the following ways:
- Thank employees for their hard work in person.
- Send a personalized letter – either handwritten or by email – praising employees
- Develop an employee recognition program, such as an employee-of-the-month program.
- Give positive shout-outs to employees.
Be Flexible With Work Schedules
Forcing employees to work strict schedules with little or no room for adjustments may cause them to quit. The Internal Revenue Service (IRS) recently conducted a survey of U.S.-based employers, which revealed that flexible work schedules have a significantly positive impact on employee retention as well as recruitment.
You don’t have to necessarily give employees free rein over when they work, but you should consider loosening up the restrictions on their schedules. When employees have some level of control over their work schedule, they are less likely to quit. Furthermore, flexible work schedules have been linked to increased job satisfaction and less stress.
Offer Benefits Beyond Monetary Compensation
Another way to lower your company’s employee turnover rate is to offer benefits beyond that of monetary compensation. All employees expect monetary compensation. After all, a paycheck is typically the main reason why people seek employment, and there are federal and state laws for minimum wages that employers must follow. By going beyond monetary compensation, though, you’ll make your company a more attractive place for employees to work.
Insurance – medical, dental, vision, etc. – is a nonmonetary benefit that many employees desire. With private healthcare costs on the rise, employees often look to their employer for insurance. Also known as group insurance, employer-sponsored health insurance allows employees to secure insurance at a discounted price.
Along with insurance, you can offer a health and wellness program for employees. Health and wellness programs are designed primarily to encourage healthy lifestyle choices, but they often have a positive impact on turnover rates. A health and wellness program, for instance, may include a gym membership that employees can use to workout and exercise, or it may offer incentives like gift cards or spa treatments to employees who make healthy choices.
Allow for Career Advancement
You can lower your company’s employee turnover rate by allowing for career advancement. When hired, new employees want the opportunity to rise the corporate ranks so that they obtain better-paying and more desirable job positions. Known as career advancement, it encourages them to stay rather than quitting to seek employment elsewhere.
Talk to your employees to inquire about their professional aspirations. If an employee aspires for a higher-paying position, explain what he or she must do to obtain that position. By offering a clear path, the employee will likely stay with your company while progressing towards his or her goal.
Don’t let a high employee turnover rate hinder your company’s long-term success. Take action today to cultivate a positive company culture and lower your company’s employee turnover rate.