4 Employee Retention Strategies
At NBRI, we talk a lot about effective employee engagement and employee retention strategies. The average cost to replace an employee is approximately 150% of the lost employee’s annual salary for loss of productivity, efforts to find a replacement, recruiting fees, training the replacement, and the loss of productivity of co-workers who assist in training the new employee. Meaning, if you lose an employee who is paid $40,000 annually, it will cost your company an average of $60,000 in replacement costs. Keeping good employees happy will reduce the financial burden of employee turnover. Here are several employee engagement related strategies for employee retention:
1. Keeping Employees Engaged
According to our research, 30% of employees would be more engaged at work if they received a pay raise. The caveat is that the employee must perceive the pay raise as significant and it must be delivered in a manner that motivates. Improved performance must precede the raise or the raise will actually turn into a demotivation in a short amount of time. This is a vicious circle. The employee must first be engaged to perform at a high level and then and only then is a raise a long term motivator. This is why setting expectations and measuring results is extremely important at the manager level. Pay raises must be delivered at the right time and in the right way to be effective. Pay raises are not the only way to increase engagement levels – 17% of employees are more engaged after a job redesign. Adding more responsibility and additional tasks to a good employee will contribute to the overall success of the company and keep them more engaged2.
2. Recognizing Good Employees
According to the Workforce Mood Tracker Survey, 69% of employees would work harder if their efforts and successes were more recognized. Utilizing rewards and recognition tactics is a great way to improve employee retention. Setting goals and rewarding employees who reach those goals will identify the employees that are most engaged and keep them working hard. Also, 65% of employees who classified themselves as “satisfied” stated that they would work harder if they were better recognized in the workplace.
3. Quality Supervision
Employees who are in upper level management positions are typically more engaged. However, it does not mean that they are quality managers. For example, managers must make sure that employees know exactly what is expected of them in their jobs. This is more than just a conversation that happens during the annual review period. Quality supervision requires constant communication between managers and employees to insure that job responsibilities are understood and performance is objectively evaluated. Only then can an effective manager set goals and reward accordingly.
4. Corporate Culture
The corporate culture must encourage open communication or employee retention will suffer. Employees will disengage and eventually leave the company if they feel that they cannot express their thoughts and ideas.
These are just 4 strategies for improving employee retention that we have found to be very effective. NBRI has decades of experience assisting organizations with employee engagement and retention issues. Contact us today to get started.