In any business employee retention is crucial. Some staff turnover is expected – people retire, move away, personal circumstances change, or they may be looking to progress into a role that you just don’t have available. That’s okay! Turnover can even be helpful when it means you have the space to hire new skills you need. But excessive turnover is to the detriment of the business. Frequently losing and replacing staff can:
- increase costs
- create skills gaps
- damage company reputation
- reduce morale
- impact quality of service
- lose historical and informal company information
Ultimately, turnover is often high when employees don’t feel valued.
Lots of employers assume that a competitive salary and good benefits package are the driving factor in attracting and retaining employees. They are certainly important. But they aren’t the only motivation!
There are two types of impetus that cause an employee to leave a role. These are known as push and pull factors. As a business owner, you don’t have any control over the pull factors, but the push factors are in your hands!
A pull factor might be one of the reasons mentioned at the start of the blog. Whatever they are, they come from outside the company.
Push factors include:
- Poor pay
- Poor relationships with colleagues or managers
- Lack of career development
- Absence of recognition
- Non- alignment with company goals
- Lack of motivation
Improving employee retention means focusing on creating a positive company culture so that employees feel comfortable, respected and valued, whatever their role in the business.
Employee Engagement
Are you shocked to learn that (globally) 62% of employees are not engaged at work? Sadly, we weren’t! Employee engagement is key to a thriving business, but all too often business owners don’t focus enough on improving it. Check out our blog on engagement and job satisfaction for some top tips on improving engagement.
When employees are engaged, they tend to develop a sense of loyalty and commitment, reducing the chances of them seeking opportunities elsewhere. If employees are not engaged, they will likely have lower morale and it could easily create a loss in productivity which negatively affects the business. Engaged employees build stronger relationships with their teams and with management, supporting long-term retention.
Vision and Values
If employees feel connected to the company’s vision and values, they are far more likely to feel loyal. If you don’t have a clear and recognisable set of values, start working on defining and articulating them! [JG1] Get your employees involved – this helps to nurture the idea that everyone on the team is important. Publish the values in your Employee Handbook and circulate them so everyone understands their importance. And remember … values won’t be shared if the management team isn’t leading by example!
Values can only really be values if they are embedded into the fabric of the company, so that they guide and inform all aspects of business operations and culture. They are essential to: [JG2]
- how the right staff are selected in recruitment
- how performance is assessed and rewarded
- how promotion and development decisions are made
- how company procedures and rules are decided
Make sure you share your vision for the company with all staff – tell them where you started and where you are hoping to go. A good exercise for sharing the vision and motivating the team is to look back regularly and highlight the progress that’s been made. Everyone is contributing, so everyone should feel the joy of success.
Communication
Companies that create a culture of open communication will benefit from more engaged, confident employees. To start building this positive culture, ask for feedback and act on it! Show that you mean what you say. Anonymous feedback opportunities are a sometimes a useful way to help you to identify potential issues before resignation. An employee might not feel comfortable stating problems openly or discussing it with their line manager; although of course the strongest cultures are those where such open dialogue is welcomed … and acted upon.
“Stay interviews” (the exact opposite of exit interviews!) have become an invaluable way to gather information about what encourages employees to stay with their current employer. Staff surveys and a measure of the company’s employee Net Promoter Score (eNPS) can give useful insights too.
Competitive Salary and Benefits Packages
For good staff retention, it is essential that employers:
- pay at least the living wage (this is higher than the statutory minimum wage)
- regularly adjust wages in line with inflation
- offer wage increases as experience grows
- reward increased responsibility
- are aware of what the competition is offering
Remember it’s likely that hiring new employees and training them will actually cost more than paying your existing employees what they deserve.
Aside from the salary, good employee retention programmes will invariably contain a benefits package. This might include private health insurance, dental care, access to mental health services, discount schemes, gym memberships and retirement plans. Flexible benefit packages are popular – by allowing employees to tailor what’s on offer, they will gain more value from them.
It is also really important to acknowledge staff who are working hard. This might be in the form of trivial benefits, highlighting achievements to the whole team, holiday reward schemes, or simply genuine expressions of praise. A “well done” means much more than you might think! Staff whose good work is acknowledged feel motivated … and then continue to produce good work.
Career Development and Learning Opportunities
To ensure staff feel valued, demonstrate that you invest in your people. Some business owners don’t offer many (or any!) development opportunities out of fear that, equipped with new skills, the employee is going to leave and take those skills elsewhere. If anything, the exact opposite is usually the case, that supporting employees to learn drives loyalty and makes your company stronger.
Equality, Diversity and Inclusion
Companies that emphasise equality, diversity and inclusion are much more likely to benefit from good employee retention. Unfortunately, many organisations lose fantastic team members because they haven’t made the effort to create an environment which is welcoming and supportive of everyone.
For specific advice in one area that has garnered much discussion recently, that of supporting neurodiverse employees, check out our blog on empowering neurodiverse teams.
Flexibility
Flexible working opportunities are a huge plus in this modern-day world. Allowing staff to work from home or in a hybrid structure gives the employee more flexibility where it works for the business too. Why lose a great team member because you won’t let them finish earlier one day and work later the next? This also promotes a good work-life balance, which in turn improves job satisfaction.
Offboarding
Sometimes, it’s simply time for an employee to move on. Offboarding is still important for employee retention, not least to show your remaining staff that you care about the person, not just what they do for you.
When someone hands in their notice, it’s really important to conduct a proper handover and have an exit interview, and it’s not just important for the person who’s leaving! This feedback is invaluable for learning what you need to do to improve retention. An exit interview shouldn’t usually be conducted by the employee’s line manager, but by a member of HR or an independent third party.
Conclusion
Retaining top talent requires a proactive approach centred on employee engagement, career development and a positive company culture. By offering clear communication, competitive compensation, learning opportunities, and fostering a sense of belonging, businesses can significantly reduce staff turnover. Prioritising company values not only increases employee satisfaction but also strengthens the entire organisation. Investing in your employees’ growth and well-being keeps them motivated and drives long-term success for your business.
Retention isn’t just about keeping staff — it’s about creating a workplace they won’t want to leave!
For support with addressing high employee turnover, contact us on 01252 757359 or drop us an email at [email protected].