5 Ways to Lower Staff Turnover in Your Business
by John Pring
High staff turnover is a common and frustrating problem for managers, particularly in the UK and the US, where research suggests up to 50% of new employees will not stay at a company past their first year.
It's not just a question of annoyance and having to spend time sourcing new staff however, as high levels of turnover can have a major impact on employee morale and productivity, and it comes with a significant cost implication too, with estimates suggesting it can cost between 30% and 150% of an employees' overall annual remuneration.
So how can you reduce staff turnover? Drawing on reducing staff turnover research from Cascade HR, here are 5 ways you can lower staff turnover in your business:
1. Take the time to fully research candidates before hiring them
This is crucial to reducing turnover, and can also impact your overall team morale and productivity. Take advantage of social media to look at all aspects of a candidate, and use this additional information to make sure the candidate is a good cultural fit for your business. Similarly, you should consider tweaking your hiring process to ensure candidates are exposed to both the company and their job role - by spending additional time explaining what the company does and where they will fit in, you can ensure a good cultural fit for candidates and improve the chances of them staying in their job in the long term.
2. Encourage communication and welcome new ideas
Ask your employees what they think, and encourage them to share their thoughts, concerns and suggestions with other members of the team - including management. When you're making decisions about the company, give employees the opportunity to make their voice heard, and be sure to act upon (and properly credit) good ideas from your team. This makes employees feel valued and listened to, and can result in major positive changes when it comes to turnover, morale, productivity and staff motivation.
3. Invest in your staff
Remuneration is obviously important, but research has shown that salary isn't always the most important thing to team members. You should invest in mentoring, training and creating a culture of communication and collaboration - create an environment where new ideas are encouraged, good work is rewarded and employees feel like they're valued by the management.
4. Offer perks, benefits and investments to employees
Research has repeatedly shown that employee benefits can have a major impact when it comes to lowering staff turnover and improving morale, and it's often cheaper than increasing salaries across the board. Consider perks like health benefits, gym memberships or discounts at partner stores and organisations, or go a little more unusual with things like extra holiday days, pet insurance or health savings accounts.
5. Take advantage of those who are leaving to learn about your business
Sometimes it may be too late to stop an employee leaving, or they may be quitting their job due to something that's entirely out of your control. In this situation however you can still learn from them and use it as an opportunity to lower turnover in the future. Conduct exit interviews with departing team members in order to learn what they think about the company, and be sure to ask for a rationale behind them leaving, as they're likely to be honest with you and their input could be invaluable. When you find out they're leaving, make a hiring plan as soon as possible, in order to limit the impact of their departure on the rest of the team.