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Learn what the most successful companies are doing to boost their retention rates 2023.
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A high staff turnover can have a huge impact on your business’s bottom line.
Firstly, there’s the immediate cost of replacing an employee – which usually comes in at around 20% of their salary.
Plus, companies with higher turnover rates have lower employee engagement levels. And since
engaged teams are 21% more productive and engaged employees generate 43% more revenue than disengaged ones, the total cost of poor staff retention rates really add up.
And while “the Great Resignation” might have started during the pandemic, it’s showing no sign of slowing down.
So, read on to learn everything you need to know to rise to the employee retention challenge – and discover what some of the world’s biggest companies are doing to keep turnover rates down right now.
A company with an annual turnover rate lower than 40% is considered a low-turnover business.
While that might seem high, it does include both voluntary and involuntary staff turnover across all sectors – including high-turnover industries like leisure and hospitality.
On an individual level, the average private sector employee sticks with a job for 3.7 years. However, age has a big impact on that, with the median tenure of workers aged 55 to 64 coming in at 9.8 years – more than three times higher than workers aged 25 to 34 years (2.8 years).
Book a demo of Assembly to make measuring staff retention rates across your organization easy.
Want to know how to decrease employee turnover? Simply follow in the footsteps of the companies getting retention right.
Here’s a closer look at the initiatives some of the world’s most successful businesses use to keep their staff happy and loyal.
People don’t stay in jobs that don’t let them put their talents to use for long. An employee who loves crunching data isn’t going to last in a customer-facing role, while a people person isn’t going to want to be sat staring at spreadsheets all day.
We all have different strengths, and the companies with the lowest turnover rates find ways for their people to put theirs to good use.
Google has a unique way of making sure its employees find their work meaningful – its famous 20% rule.
"We encourage our employees, in addition to their regular projects, to spend 20 percent of their time working on what they think will most benefit Google," the company's co-founders, Larry Page and Sergey Brin, wrote in 2004.
"This empowers them to be more creative and innovative. Many of our significant advances have happened in this manner."
While you might not be able to give your teammates a day every week to work on a project they find interesting, you should think about ways you can replicate this in your own way if you want your people to stick around as long as possible. Could you set aside a day a month for your people to work on a project they don’t usually have time for or take that training that’s always at the bottom of their to-do list?
Giving your people meaningful work to do is key to keeping them engaged. The boost to your turnover rates that comes from allowing your people to work on passion projects is likely to pay dividends – even if those projects don’t go anywhere.
Try Assembly to see how easy it can be to take the pulse of how engaged your employees are with their work.
Don’t be surprised if staff turnover is high in your company if your people feel like they’re always rushing to hit unrealistic deadlines, walking on eggshells around certain topics or team members, or feel like they’re being taken for granted.
What sets organizations with high retention rates apart from the rest is that they go out of their way to look after their people. For example, around half of Cisco’s employees have worked for the company for over five years. And a big contributor to the company’s low staff turnover is its “A Day for Me” policy, where all staff are encouraged to take a designated paid day off for their wellbeing.
These kinds of perks aren’t going to transform your retention rates on their own. But walking the walk when it comes to making staff wellbeing a priority is key to making sure your best employees stick around.
Your best people are going to start eyeing the door if they feel like they’ve hit a glass ceiling in your business. But if you make it easy for them to map out a clear career path within your organization, you’ll give them a huge incentive to stay.
The hotel chain Hilton understands this. All its staff can access Hilton University, an internal training programme that includes over 25,000 courses, videos, and book summaries focussed around customer experience. And the company’s Lead@Hilton programme and General Manager Academy are available to every employee interested in climbing Hilton’s corporate ladder.
The companies with the lowest turnover rates help their people achieve their career goals without having to jump ship to another job. Of course, this can be trickier in start-ups and small businesses than in international corporations, as there often isn’t as much room for your people to grow into. But ignoring your people’s career aspirations entirely is one of the biggest mistakes you can make when it comes to retention rates.
So, make sure to cover career growth in your employee satisfaction surveys – as well as through the questions you ask your direct reports during one-on-one meetings.
Being appreciated and thanked by managers is the number one factor that motivates most employees. In fact, 40% of employees say they’d put more energy into their work if they were recognised more often. And 70% even say their motivation and morale would improve “massively” if managers simply said “thank you” more.
It won’t be long until your employees start eyeing the door if you don’t recognise what they bring to your business.
This is something DHL gets right. Alongside Employee of the Quarter and Employee of the Year awards, the company has an annual Employee Appreciation Week, which it spends “recognising outstanding team members and broadcasting their accomplishments to the company”.
65% of employees haven’t received any form of recognition for good work in the last year. Following in DHL’s footsteps and singing your people’s praises is a surefire way to increase retention rates that doesn’t cost you a penny.a
Giving your managers tools that make it easy for them to praise their colleagues – like Assembly’s Give Recognition Flow – is a simple way to turn employee recognition into a cornerstone of your company culture.
Book a demo of Assembly to get all the tools you need to make recognizing your employees as easy as possible.
The businesses that give their employees meaningful work, make their wellbeing a priority, help them achieve their career goals, and recognize their accomplishments have industry-leading retention rates.
Follow in their footsteps to hold on to your best people and keep your annual turnover low this year.
Get the foundational knowledge on creating an employee recognition program that boosts employee engagement and helps them feel valued.
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