The past year has seen a massive number of employees walk away from their jobs, leaving companies scrambling to find replacements and wondering why their employees walked out in the first place.
As a small- to medium-sized business owner, you may be worried about your employees following suit. The good news is that the cause of most employee retention problems is preventable. We have gathered the best tips from around the web to help you retain your best talent.
1. Develop a strong company culture
When employees were asked why they decided to leave their current jobs, one of the top reasons was not finding meaning in their work. Companies with a strong culture centered around employee well-being and happiness as well as the importance of social interaction are more likely to attract (and keep) employees.
You can get as creative as you like fostering a social workplace environment. REI, the outdoor sportsgood company, has a program where employees can propose a challenging outdoor adventure by submitting a “challenge grant” for a chance to win equipment. Think about what would get your employees excited to come to work and go from there.
Having supportive leaders that make sure employees’ voices are heard also contributes to a healthy culture, as seen in companies like Squarespace. This point ties into the next tip, as open lines between management and employees help to facilitate clear communication and expectations.
We’ll come back to this idea of building a strong company culture later on in this post, including how to recognize your employees’ accomplishments (even small ones) and offer continuous growth opportunities.
2. Create a culture of transparency
Open communication is essential to the success of any business. It can help employees feel heard, boost morale, and make any problems known before the damage is done.
In this type of culture, employees feel encouraged to voice their concerns. This makes it easier for management to be aware of issues and address them as soon as they arise.
Open communication is a particularly important element in the creative and tech industries, as it fosters knowledge sharing and collaboration. Whether you’re in a fast-paced industry where innovation is constant or just looking to show employees that you care, creating an open environment can be a game changer in your productivity and employee retention.
3. Celebrate your employees and their accomplishments
Integrate appreciation and recognition into your company’s culture by celebrating everyday victories–even in an informal way. That can mean scheduling a 1:1 to give positive feedback or writing a personal note of thanks for a job well done.
You can also let your employees know they’re valued by celebrating bigger accomplishments such as a 5-year work anniversary, promotion, or even life events like birthdays, births, and marriage. This can really help create a sense of community and improve workplace morale.
Remember, it’s important to be mindful of how you frame your praise and recognition. Make sure that you focus on what your team did well and not any other outside factors or qualifiers. You can also encourage employees to recognize each other for their accomplishments by nominating their peers for awards and promotions.
4. Growth opportunities
Suppose an employee can’t see a future with your company. In that case, nothing is tying them to your business when another opportunity comes along, even if they aren’t necessarily looking (after all, LinkedIn is only a click away). Giving employees the chance to grow their skills and move up the ladder shows that companies are willing to invest in their employees.
One way to do this is to make a point of hiring from within. Pay attention to where your employees express interest and offer them the first chance to apply for a more senior position. Prioritizing hiring internal candidates demonstrates that you recognize their talent, and has the added benefit of being a cost-effective option by cutting down on additional onboarding and training.
Professional development and training also open the door to growth and career progression. This can be done by offering workshops, courses, travel stipends for conferences, and funding for certifications. You could even encourage employees further by offering raises to those who complete courses, a tactic Zappos has found successful. Supporting your employees in growing their skillset is valuable for them and a long-term investment in your company.
5. Promote a healthy work-life balance
One of the top reasons for employee dissatisfaction and burnout is poor work-life balance. As remote work becomes the new normal, the lines have blurred between personal and work time.
There are plenty of ways employees can create boundaries to prevent burnout. Suggest to your remote workers that they set up a separate area in their home specifically for work hours and keep their work devices out of personal spaces like the bedroom.
Take steps to incorporate these types of healthy boundaries into your company’s culture, and ask managers to limit requests outside of set work hours.
Upper-level employees really set the tone for the rest of the company and should make an effort to model healthy work habits. This can significantly increase both employee well-being and overall productivity.
Remote work is here to stay. In the war that is employee retention, it’s worth losing the battle on remote work and allowing employees the flexibility to work-from-home (WFH) if they choose. Whether your reasons against a remote workforce are based on tradition or worries about the loss of productivity, there’s no point in fighting it if you can reasonably accommodate. After all, new studies suggest that productivity has actually increased since the switch to remote work.
The pandemic proved to employees that WFH was possible–even desirable. At least one study has shown that a third of employees are willing to leave their company if they ask them to return to the office. Can your company afford a loss of that magnitude?
The good news is, there are plenty of ways to implement a work-from-home schedule that benefits both you and your employees. Many employees are perfectly content with a hybrid scenario where they work from home just three days a week. LinkedIn’s 2021 Workplace Learning Report said 31% of employees would stay for a more flexible schedule.
Be sure to evaluate your business needs and talk to your employees to determine the type of schedule that will work best for you. Develop a solid plan to make the transition as smooth as possible, taking into account potential issues with communication and team coordination.
7. Competitive compensation
Money isn’t everything, but it certainly helps. With the labor market as fierce as ever, in order to even have a chance at wooing the best talent, you’ll need to make sure the compensation you’re offering is competitive. While salary is only a part of the full compensation package, it is still the most important one.
According to Indeed, competitive pay is defined as “equal to or above the standard [salary] offered by companies in the same industry or geographical area.” If the position you are hiring for requires a more highly-skilled person, you’ll likely need to offer higher pay to attract the right candidates.
Do your homework and take advantage of online resources, like Indeed Salary, to better understand the average salary of different positions. Be sure to stay up to date and adjust job descriptions according to market fluctuations. That way, you’ll have a fighting chance against your competition when it comes to hiring new talent.
8. Offer benefits
Offering a competitive compensation package to attract the right workers means making sure your benefits are up to par as well. Start with the basics– healthcare and retirement– then evaluate the needs of your employees to fill in the rest.
Think you can’t afford a retirement plan as a small- to medium-sized business owner? Think again.
Pooled Employer Plans (PEPs) make offering retirement plans affordable for businesses of any size, and we here at peppermint, take care of the bulk of time-consuming admin and plan details so you don’t have to. Businesses that don’t offer attractive retirement plans simply miss out on top talent. Talk to an advisor today to discuss if a PEP is right for you.
AIHR are experts in human resources and have put together a comprehensive guide to types of benefits as well as which are the most important benefits for each generation.
Besides traditional benefits, employees value workplace flexibility, vacation time, and health and wellness perks like gym memberships or mental health days.
9. Conduct exit interviews
The best way to tackle a problem like employee retention is to understand why employees leave in the first place. The easiest way to do this is to conduct exit interviews when an employee turns in their two weeks’ notice.
Even better– catch them before they resign and try to identify those most at risk of leaving.
A key indicator of potential employee departure is low engagement. Be on the lookout for these signs of disengaged employees: those who show a lack of motivation, unresponsiveness, and inability to show up (mentally or physically). Then, try to understand why they have one foot out the door. The reason could be as simple as they are lacking an appropriate challenge. Focus on the people who would most impact your business if they were to go.
In an excellent article on why people leave their jobs featured in Forbes, Roberta Matuson recommends asking four questions to get to the root of the issue: “What were your hopes and dreams when you took this job? How are you doing in terms of achieving your goals? What, if anything, has changed? What can I do to help you reach your dreams?” What you do next is up to you.
10. Check in with employees regularly
Prevention is key when talking about employee retention. Make sure that you listen to your employees and understand their needs. Take the pulse of your business through an annual evaluation–after all, as we grow and change, so do our needs.
Make time for informal 1:1 meetings or coffee chats with your employees to gauge how they’re doing in work and life. Doing so keeps managers and employees on the same page and forms an open line of communication. It’s a simple yet effective way to identify a dissatisfied employee before it’s too late.
11. Hiring the right people
Making sure your employees stay with your company starts by ensuring they are a good fit to begin with. If an employee isn’t the right person for the position or isn’t aligned with the company’s values, chances are they will eventually leave.
Zappos seems to have come to similar conclusions and has enacted a cultural fit interview that carries half the weight when considering whether to hire an employee.
Additionally, they offer monetary compensation to new employees after the first few weeks of training if they feel that, for whatever reason, the job isn’t a good fit and they would rather not continue the work contract. The lesson here: It’s truly better to cut losses early than to continue with an employee who isn’t in it for the long haul.
Dial-in your management team when it comes to the hiring process, as the wrong choice could make or break any given team. By taking steps to ensure that potential employees will fit in with the culture and company goals, you are more likely to find success. People get along best with other like-minded individuals.
Losing employees, particularly highly-skilled and valuable employees, can be costly in time, money, and resources. It can take up to 94 days to fill a highly-skilled position, not to mention the time it takes to onboard and for employees to become knowledgeable about your company’s services and products.
The pandemic has changed the work landscape for good, and with that come new challenges. Pre-Covid retention plans with flashy perks won’t cut it.
Start with your overall culture and public image, make sure you are offering a competitive compensation package, and get to the root of why your employees are leaving in the first place. Listening to your employees will help with employee retention in general, but more importantly, will create a better culture for everyone.
Don’t wait to take action, as most employee departures are preventable. If you don’t have a strong benefits package or retirement plan in your retention strategy, now is the time to get one. Don’t let your best talent walk out the door in a competitive labor market. Talk to one of our advisors today to see if a PEP plan is right for your business.