Retaining Your Top Talent: The Secret to Employee Retention
Among the many revered study groups bemoaning the US turnover rate is Gallup Workplace. Over a series of several research projects, they’ve reached the following conclusion:
A trillion dollars.
That’s what U.S. businesses are losing every year due to voluntary turnover. And the most astounding part is that most of this damage is self-inflicted.
If you’re looking for ways to retain top talent, you’re not alone. In order to uncover the secret to employee retention, we need to get in the heads of employees. If this turnover rate really is “self-inflicted” by employers, we need to bridge the gap between what employers think their employees want/need and what employees feel that they want/need.
Reasons for Employee Turnover
Gallup Workplace was able to break down company losses per employee, “The cost of replacing an individual employee can range from one-half to two times the employee’s annual salary.” So before you allow yourself to feel worried about the costs associated with retaining top talent, remember that it likely will not compare to the price you’ll pay as a result of employee voluntary turnover.
Here are five of the top reasons why top talent leaves their employer for better horizons.
1. Leaders don’t talk to employees about job performance and career growth.
There is an unfortunate great divide between managers/executives and the general workforce. The result is that employees have no idea how they are doing and how they can improve. A lackadaisical workforce is not lazy – they genuinely don’t feel that their role matters.
Not only that, but employees don’t feel heard. It’s not just they don’t feel their role matters, they also feel as though they do not matter. This is a dangerous company culture. Employees feel superfluous to the organization, and there is a serious lack of trust.
2. It is too difficult to acquire livable wages.
Too many employers pay their full-time employees below the poverty line. Many that do pay above the poverty line are still not paying livable wages for employees with children and/or college debt.
The truth is that employees work for minimal pay because they are oftentimes desperate. But it should come as little surprise if top-performing employees that are paid painfully low wages use your company to gain experience and immediately seek employment elsewhere.
Job satisfaction is commonly linked to annual salary and/or benefits package, recent research by Glassdoor states that 35% of employees are so unsatisfied with their salary that they’re willing to start a job search over it.
If your organization is not willing or able to maintain salary parity, you can’t expect to compete for top talent effectively. This is especially true with regard to employees with highly valuable skills.
3. Employees don’t feel that the company is loyal to them.
For the reasons listed above, many employees simply don’t feel that their employers are committed to them. The culture is toxic in that the employer demands loyalty and acts as though he/she intends to take that loyalty by force.
4. Poor management makes the work environment toxic.
9 out of 10 times, a toxic work environment has to do with the managers. It is dangerous to assume that all managers are effective leaders by default. Executives are too often out-of-touch with their managers with little or no open-communication.
5. Employers are needlessly inflexible with work schedules.
It is not necessary that employers allow their employees to work whenever they want. However, when employees feel they have no work-life balance and that they must sacrifice their personal (and their families’) well-being in order to keep up with company demands, something is going to give.
Building an Employee Retention Strategy
As dire as the problems above are, many organizations are course-correcting in a way that drastically changes their company culture for the better. Here are 5 effective employee retention strategies to take and successfully retain, rather than burnout, your top talent.
1. Open up a dialogue between leaders and employees.
You should take the time to listen to your employees, especially your managers. Create a safe space for open communication where your workforce feel they can speak freely. When employees feel heard, they will be able to tell you what they need.
The most important thing to do is to listen and ask probing questions. Once you feel you’ve validated the needs of your employees, be transparent with your employees about your concerns. Collaborate with your team members on sustainable solutions.
2. Convert your managers into leaders.
Your managers should be your strongest leaders. If you demonstrate leadership by mentoring them, you can be frank with them about your expectations. At the end of the day, your managers are the ones that will make or break your employee retention.
3. Build a remuneration plan that pays employees a livable wage.
Look for ways to increase employee compensation where appropriate. Remember, if you increase employee retention, you will save your company money. If you have less employee turnover (which costs nearly twice a position’s salary), you can easily use those freed-up funds to take care of your employees.
Ensure payroll is efficient and on time for every pay period, if you are including stock options or other benefits packages as part of the employee’s salary then ensure employees understand and have access to their payslips. Easily accessible payslips using an employee self-service application as part of your payroll technology empowers employees to access their own employee information as and when they need it and conduct interactive tasks relating to their role or their benefits package all contributing to overall positive employee experience when it comes to payroll.
To find out more about the employee self-service application offered through the Payslip Platform click here
4. Consider offering college debt relief.
When it comes to the company benefits package, the single greatest concern of Millennials and Gen Xers are the sheer volume of college debt. If you are able to tweak the benefits to include college debt relief or tuition reimbursement, your employees will be immensely grateful. It will also allow their wages to go farther and will be seen as a perk.
5. Consider work from home opportunities.
If your company is not comfortable with offering employees 100% remote positions, consider partial work from home options. Not only does it save your employees time and commuting costs, but it also gives them an opportunity to work in a more relaxed environment. More and more companies are expanding their remote opportunities, and it is helping team members improve their work-life balance.
Your employees have their own set of problems. If your turnover rate is high (especially among your top-performers), then their work environment is one of their major problems. The secret to employee retention is understanding where the workplace culture is subpar. Take time to absorb your employees’ concerns.
Once understanding their concerns, measure your human resources practices against what your employees need. Use the strategies above to get your company culture back on track. Once you do, you will naturally retain top talent and build a strong network of industry leaders that work for you rather than your competitors.
Using Payslip, we can manage all our payrolls across nine in-country vendors on one platform. When the global Covid-19 pandemic arose, it was not an issue from a payroll perspective, and critically getting everyone paid. The Payslip platform enabled continuity for our international payroll service including the fast and seamless implementation of the Payslip Employment Self Service during this time.
Payroll Manager, LogMeIn
With business and employee growth rates of above 50%, we rely on our vendors to deliver on time, every time. Payslip’s workflow automation, enables Phorest to manage our payroll provider process – data driven, real time and transparent. Payslip saves us time so we can focus on our business growth.
International Payroll Manager, Phorest