Employee Retention Strategies: 7 Factors Why Employees Stay

In times of severe shortage of skilled workers, employee retention is more important than ever – because if good staff is difficult to find, you should keep the existing ones at all costs. This does not necessarily have to be a cost factor. With these tips, you can promote a motivating work environment in which people are happy to stay with little effort and a small budget.

To feel respected, valued, taken seriously and part of a team – that’s what most employees want. If employers take this to heart, it will be much easier for employees not just to do work to rule. When everything fits, they turn on their heads, achieve incredible things and help the company to grow (in two senses).

However, few employees feel connected to the companies they work for. Here’s what the 2020 Gallup Engagement Index shows:

Employee retention is defined as an organization’s ability to prevent employee turnover, or the number of people who leave their job in a certain period, either voluntarily or involuntarily. Increasing employee retention has a direct impact on business performance and success.

I could share all day with you on why employee retention is important for your business, but here:

Employee retention needs to be top of mind for any company, as the cost of losing top talent is great. SHRM estimates that it costs $20,000 to $30,000 in recruiting and training expenses to replace a manager making $40,000 a year. This doesn’t even account for losses in terms of interview time, knowledge, productivity, or cultural impact. And low retention rates also impact motivation, productivity, and performance. Before employees quit, they may become less of a team player, do the minimum amount of work, and fail to commit to long-term deadlines.

HR isn’t powerless, though — 77% of the reasons behind employee departures are preventable. The key is to pinpoint the issues that may be driving employees to leave and address them before it’s too late.

It is not impossible to have motivated and satisfied staff, but it does not come easily to a company either.

If an employee is already looking around to see which jobs are available on the market, he/she is already out the door with one foot. Accordingly, it is important to treat the problem before it even exists. This begins with the interview (keyword: candidate experience), continues with onboarding and ends with regular feedback (which also includes the letter of rejection). So that a counter-offer for termination does not even become necessary, countermeasures should be taken in good time.

When employees feel disconnected from their employer, the impact is far-reaching and costly. The work performance is worse due to a lack of motivation – “I don’t care, it’s not my company” – if this sentence is repeated in the team, you should prick up your ears. Employees who are not very committed are also more likely to remain silent about undesirable developments in the company and keep their concerns to themselves.

If employees leave the company again quickly, this makes the affected teams and thus the whole company unstable: knowledge cannot be built up in the necessary depth or is quickly lost again, customer service suffers and the remaining staff are under increasing stress.

Disengaged employees are a symptom of a larger problem and it is often up to HR management to solve these problems. 

Below, we share five thoughtful employee retention strategies that will help you grow your business beyond bothers;

#1 Appreciation

Give praise only in moderation – a credo that can backfire properly. According to the book How Full is Your Bucket, underappreciation is the number one reason employees quit. Anyone who always delivers solid performance should also experience appreciation for it. Nothing is more frustrating than not getting recognition when you deserve it. It is primarily about immaterial things: Employees value praise more than gifts!

A reasonable salary and suitable benefits are part of the appreciation of the work. However, these things are just a bonus that cannot replace a stable foundation of mutual respect, appreciation and good communication.

#2 Feedback

“People come together by talking” – establishing an open culture of discussion can nip many problems in the bud. Giving direct feedback helps employees, as does regular contact. It is only through feedback on their work that employees can grow and develop.

A good employer/employee relationship is based on communication, trust and respect. This can only take place if the relationship between different hierarchical levels is positive or at least not negative. If fear mixes into everyday work, for example because the department head never greets and only speaks to the employees when there are problems, the atmosphere is poisoned. Giving and receiving feedback becomes very difficult there.

How do you achieve a healthy feedback culture in the company?

Important: The quality of feedback! Meaningful, meaningful and constructive feedback achieves more. Incidentally, these can also come from colleagues, as they often have a better insight into everyday work – managers should encourage their team members to give each other feedback and set a good example.

#3 Happiness and advancement

Employees cannot be forced to do their work with passion – but you can ensure a positive working environment and make a big difference with the smallest changes in everyday work (see point 1 and 2). Anyone who is “happy” with their job will undoubtedly do it better.

If employees are demotivated, they are also more likely to complain about their work and fill their day with lots of breaks or social media. then you should ask yourself:

If a team member seems dissatisfied, withdraws or becomes cynical, the respective situation should be examined more closely and evaluated as to how it could be improved for both parties. A concrete solution to the problem could be to work out the role of the person in the company in an open conversation and to determine in which direction it can develop. Opportunities for advancement or transfer increase the chance that an employee will stay with the company for a long time.

#4 Education and Freedom of Choice

Offering employees professional programs for advancement and further development promotes personal motivation, the desire to grow with the company and employee loyalty.

Self-employment and independence largely determine employee satisfaction and are essential in the increasingly agile world of work.

What can leaders do about it?

Give trust! Allow employees to own projects

Motivation also arises from the feeling of being needed and of constantly developing oneself: Personal further training should therefore always be on the agenda

Make further training opportunities transparent: if further training has to be laboriously demanded and is rarely approved, this scares off inquisitive employees

Forget command and control! Deal with agile methods such as OKRs to give your employees more independence and self-control.

#5 Colleagues and teamwork

Whether it’s the corporate atmosphere, the appropriate salary or the right amount of work – a suitable environment ensures that employees* are happy to stay.

Friendships at work or friendly interactions with one another should also be encouraged: if colleagues understand each other well, communication and work processes improve. Feedback, mistakes and problems are much easier to discuss when all team members know: “Everyone here means well by me.”

Not to be underestimated: fairness within the teams! Employees should feel that they have about the same workload as their colleagues and receive the same recognition for their work. The salary is also included. If it turns out that the office neighbor gets significantly more for the same service, the motivation is gone.

Take a look: Managing for Employee Retention

That’s it guys – 5 employee retention strategies your business can leverage to growing your business beyond bothers in the rest of 2022.

If I was you, I’ll share this post with my family and friends.

See you in our next post.

What is the meaning of employee retention?
Employee retention is defined as an organization’s ability to hold on to its employees. It refers to the strategies an organization develops to mitigate employee turnover risks and the processes it puts in place to increase retention of top talent.

How do you increase staff retention?
Improving employee retention begins with hiring the right person. From there, strategic onboarding practices have been shown to increase employee retention, engagement and commitment. Competitive salaries, bonuses and health benefits also contribute to retention, as does meaningful work.

What contributes to employee retention?
Employees remain at organizations for a variety of reasons, including meaningful work that leverages their skills and abilities, career development and growth opportunities. Competitive salaries and benefits are other reasons that workers stick around.

What are the five main drivers of retention?
The reasons employees stay on the job vary, but many commonalities exist. They include being treated with respect, fair compensation, feeling trusted and empowered, job security and the ability to use their skills and abilities to do their best work.