As the Great Resignation continues on and adversely impacts millions of employers, many organizations are heavily focused on retaining their existing employees. With rapidly increasing employee turnover rearing its ugly head in most sectors and industries, it has never been more imperative to keep existing teams happy and focused on their career opportunities. Creating a well-rounded retention strategy is more important than ever and is top of mind for companies nationwide. In the following, we will take a closer look at the most effective methods for retaining employees in the 2021 job market.
The exorbitant costs of employee turnover
Before jumping into the top methods for retaining staff, it is helpful to understand the direct and indirect costs associated with employee turnover. According to recent research, it can cost an average of 40 percent of an employee’s annual salary to replace them in the event of a resignation. On the direct expense side, there are numerous costs that come into play. For example, expenses are incurred when advertising open positions, when interviewing potential candidates, when screening and assessing talent, and when onboarding new team members. Lastly, training new employees is a time-consuming, costly endeavor.
On the indirect side of expenses incurred, there are many impactful metrics that may be difficult to track but are widely felt. For one, losing employees causes knowledge loss, as their training and expertise vanishes. Employee and company morale can also suffer, having negative effects on the bottom line. Finally, motivation is likely to suffer, causing productivity across departments to dip.
Like it or not, employers are now more aware of these costly impacts on their business. So then, what methods and strategies are organizations using to most effectively retain employees in 2021? Here are our top tips:
Understand why resignations are skyrocketing
Before implementing a new retention strategy, having a deep understanding of the psychological reasons that are behind all of these resignations is imperative. What is causing so many employees to leave their current careers? Why are they unhappy? What are they looking for? What is motivating these decisions?
According to a recent Gallup survey, these resignations boil down to a few key reasons:
- Employees are not seeing career development and advancement opportunities
- There is a disconnect between employees and an employer’s purpose and mission
- Poor relationships and management adversely affect engagement
These fundamental insights can help any business take a hard look at their overall management, culture, and other aspects of their company to address these issues. Knowing what your employees value will help you improve in the necessary ways to retain them.
Clearly communicate career advancement opportunities
As a lack of career development and future growth triggers many resignations, providing a clear path for employees will help retain them. Many employees join an organization in the hopes of growing their careers. Starting with the interview and onboarding process, communicating the career paths, training and development, and opportunities that an individual will have goes a long way. Showcase the success stories of others that have been internally promoted. Highlight how the company supports its team so that each of them has upward mobility opportunities. Not only is this important from day one, it is also vital to keep this communication consistent during their tenure.
Solidify your mission and celebrate your culture
As the Gallup survey mentioned, employees are quitting in record numbers in part due to the disconnect between them and their employer’s mission and culture. The “why” that drives your mission is more important than it has been in the past, as employees research and highly rate these employer values more so than in times past.
As we have touched upon in recent articles, the Gen Z workforce is especially concerned about diversity, equity, and inclusion. They value companies that have built a culture that reflects these important societal issues. Take a good look at your existing mission and when needed, make necessary adjustments that will resonate with your existing staff. Lastly, be sure to celebrate your company culture, as potential talent will be evaluating that closely.
Improve management skills and relationships
When employees do not feel that management is assisting them as desired, or that their relationships within the organization leave much to be desired, resignations increase. As it has been said many times, people do not quit their jobs, they quit their managers or bosses. For organizations to reduce turnover, honing in on the current management team and its managerial styles can provide useful insights on why staff may be resigning. Evaluate resignations across various departments to look for trends. Take that insight and use it wisely to improve upon the management skills and relationship-building tactics that will enable employees to feel cared for, happy, and successful.
Although each company and the individuals that are part of them are unique, there are a multitude of similarities that are impacting resignations in the labor market. Having a clear understanding of these, along with a deep understanding of your employees’ motivations and desires, will help tailor a game plan for retaining them moving forward. When your company and management team truly creates a happy, meaningful environment for all employees, resignations will drop considerably. The organizations that do this best can turn the Great Resignation into the Great Retention.
