Companies Struggling with Employee Retention: Stop Blaming Job-Hoppers and Lack of Loyalty
March 6, 2019 •4 min read
It always seems to me that there is this antagonistic relationship between employers and employees: employers want to deliver less and get more out of their workers, and well, employees want more than they are getting, especially when they have other options.
Employee retention saves companies time and money. Keeping an employee is much cheaper than hiring and training a replacement. Studies predict that the cost of replacing an employee could range from 6 to 9 months' salary on average and possibly as much as twice the annual salary for high-earners.
Happy employees with institutional knowledge outperform new employees. It may take a year or two for a new employee to be as productive. Turnover also affects the morale and productivity of co-workers.
If there are so many advantages to employee retention, why do companies skimp on fixing the issues on their end instead of blaming the workforce?
To slow employee turnover, companies will often double down on their hiring practices and reject candidates with short tenures on their resume, considering them risky "job-hoppers."
They will blame employees who leave for their lack of loyalty to the company.
Bosses will sigh and mutter about "millennial work ethic."
And they will add "fluffy" perks that employees don't actually care about in the grand scheme of things.
Here's the thing: why should workers value loyalty to companies that don't value them? How can companies provide value that workers actually care about?
Pay and Benefits
One of the main reasons that employees leave companies is because they can get a substantial pay bump by switching companies. Offers with better benefits and better pay are going to win out compared to staying with their old company that never offers raises. So check that your company's benefits are competitive (or better!) and raise pay annually to compete with the market. Better benefits means better healthcare, better childcare and parental leave policies, better PTO policies. Better benefits do not mean ping pong tables and on-site laundry so workers can stay at work longer.
Getting to actually live life is a big concern of workers. Commutes factor into this as well, so offering remote options is a great perk. Among higher-earners like tech workers, there is a point when they are making plenty on the pay side and more pay won't make up for a lack of living. Burnout is a real issue among tech, and sometimes the best cure is quitting a job, taking a break, and then switching to a new company to do new thing and hopefully have more work-life balance.
Career Advancement Opportunities
Companies, please, please invest in continuing education and training for your workforce. In tech, things change so much and so quickly, that a worker that stagnates at a job is dead in the water when they want to or are forced to find new work. If the only option to continue learning new skills is to switch jobs or study outside of work (killing work-life balance), many will simply switch jobs for exposure to new tech. Connect early and often with your employees to find out what they care about in advancing their careers.
Healthy Work Environment
A toxic work environment will make any employee want to jump ship. From management issues to sexual harrassment to discrimination and mistreatment of minority employees, there is a slew of potential issues to look at. This is one of the greatest reasons that companies may struggle with diversity as well as employee retention. Fostering a healthy, communicative, inclusive, and empathic work environment takes effort but is so worth it!
Above all, get to know your workers and what they care about. The above items are what most of the workforce cares about, but not everyone does. Actually talking to your employees one-on-one and finding out what they care about will give the biggest clues about what to change to ensure greater employee retention.
March 1, 2019
Retrospective: How I spent hours of debugging code for a one-word bug
April 23, 2019
Think others might enjoy this post? Share it!
I'd love to hear from you, let me know your thoughts!