As we emerge from the restrictive economy of the pandemic, employees are discovering they have new-found freedom to seek more satisfying employment. The resulting employee-turnover is costly for employers: On average, it can cost thirty to fifty percent of an employee’s annual salary to replace that worker, when factoring the costs associated with hiring and training, as well as the loss of productivity during the process.
What can you do to retain your talent pool and reduce the costs associated with employee turnover?
Of course, money is a factor: If you are underpaying your employees, in this environment, they will be able to find employers who will pay them their worth. However, if your compensation package is competitive, money drops to the bottom of the list of workplace factors that matter most to employee retention.
GlassDoor conducted a survey to rank the importance of five factors that matter most to employee satisfaction. Their findings were as follows:
- Company Culture and Values – 22%
- Senior Leadership – 21%
- Career Opportunities – 19%
- Business Outlook – 14%
- Work/Life Balance – 13%
- Compensation and Benefits – 12%
Another USC study asked employees what their top work motivators were. Here, the results were:
- Professional growth at work – 87%
- Being able to make a meaningful difference – 85%
- Personal recognition at work – 79%
Clearly, we find see more money isn’t really the way to keep talented employees.
So, beyond competitive pay, what are employees looking for?
Employees want a career.
A job is a thing one does to pay the bills. A career in something in which an employee can develop and grow, adding skills and responsibilities over time. A job is a moment in time, while a career is a journey.
In order to retain employees, a company must convey the idea that it is fostering its employees’ careers, and they do this by nurturing a growth culture. This means that employees feel that the company is invested in their development, that it is looking for ways to help them evolve and develop their interests and strengths. Even at times when there are no actual promotions available, employees need to recognize the company’s continued investment in their growth and development, which keeps them feeling valued and mentally challenged.
Fostering a Growth Culture
There are several ways to build a growth culture and develop employees, even when there isn’t an immediate promotion in the offing:
- Training opportunities and classes are the most basic foundation of a growth culture. This means not just job- or skill-specific classes, but professional development classes such as Emotional Intelligence, Business communications, and dealing with conflict or difficult people. These are the types of courses that will help employees develop as a person and be a better employee regardless of their job role.
- Employee development can be done at a less formal level as by employing Peer Training and Mentoring programs. This not only provides internal development, but it also creates a stronger company culture and a collaborative environment. Companies can also create support networks and groups around specific topics, such as women in business, new emerging leaders, by job role, or even book clubs. Having regular meetings where these groups can share ideas, talk through issues or obstacles, or tackle other things of interest to that specific network strengthens teams, increases communication between team members, and fosters an environment in which employees feel more comfortable seeking each other out when needing to tackle obstacles.
- On-going coaching, even when done informally, keeps managers actively engaged in their team members’ development. Good managers and supervisors have ongoing weekly or monthly conversations with their employees about how they are doing, soliciting ideas for how they think the team should be doing things, looking at things both you and they want to accomplish, as well as allowing employees the chance to ask questions and solicit further direction.
- Action learning is learning by doing. Rather than formal training, supervisors can challenge employees to learn by assigning them new topics to discover by doing their own research and then coming back with suggestions for a project or processes, or making a presentation to the rest of their team to share their newly gained knowledge. This can foster an environment in which employees become Subject Matter Experts, and become known as the go-to person for their team in certain circumstances.
- Expanding job roles – It’s important to put people in positions where they can leverage their talents, and be willing to expand or change their job role to better leverage those talents. Being able to put to use interests and abilities they already possess will lead employees to be more successful, productive, and happy, which ultimately means the company will be more successful. Companies that can redefine job roles based on their employees’ talents are much more successful than companies that create fixed, ridged roles, and try to make employees conform to them. Yes, companies have basic positions that they hire for, but they need to then let each employee’s talents expand that role.
By nurturing employees through a culture of growth, companies are showing their employees that they expect them to be around for the long haul. No one wants to feel like they are in the dreaded Dead-End Job. Making sure every team member sees a path to further develop expertise and skills, garner respect, and foster their careers will make it much less likely that they will jump ship at the earliest opportunity. Not only does this reduce those costs associated with refilling vacated positions, it also increases the value of the talent pool the company has in its current employees.