Staff turnover can be costly to your business. The exact costs can depend on the type of employment, the value of the employee to the business, recruitment costs, how long roles remain unfilled, induction/training costs and the time taken for a new employee to become proficient.
Statistics show that on average it can take 10-16 weeks to recruit a new employee when someone exits the business. This can of course depend on the skill level required to perform the role and the size of the candidate pool (for example a retail sales assistant role could be assumed to take less time to fill than an highly skilled engineering role).
Use our staff turnover calculator for an indication of the cost to your business.
Employing good policies and practices to help reduce employee stress and improve employee satisfaction is a great way to reduce turnover.
Here are some areas you can address to increase employee retention and reduce costs to your business.
Choose good managers
At times, good employees are promoted to managers because of their technical skills, not because of their people skills – but a good manager usually has a combination of both.
When a manager lacks the requisite people skills, there's often disengagement with staff which can lead to a number of issues – one of the biggest being skilled staff leaving the organisation.
Even managers with good people skills may find they only engage with staff when there's a difficult conversation to be had. This is often justified by time constraints, but waiting for an uncomfortable situation to sit down with your staff can make these scenarios more challenging than necessary.
Use our workforce information template to map out what skills your existing staff have.
Provide clear expectations
People get frustrated and demotivated when they don't know exactly what's expected of them. It starts at the top with the CEO, and is important for every level of leadership in a business.
Create a culture where you state clearly:
- vision, goals, roles, values and behaviours
- results, reporting, quality standards, timelines, priorities
- safety, policies, communication expectations (emails, phone, report formats)
- written lists of agreed actions and outcomes
Encourage people to ask questions to clarify.
Use our performance and development agreement plan template to clarify agreed actions and outcomes – and our HR manual template to develop clear policies in these areas.
Provide recognition – let employees use their skills
Encourage staff to work on areas they're passionate about and interested in developing.
Frustration and boredom are counterproductive, so you need to match jobs and people with the right skills. Conduct a skill assessment to discover special skills in your employees, and then experiment with projects and roles to get the right fit.
Recognise and reward a job well done. If a person is recruited for a role – and not given the opportunity to use their skills – they may not deliver the best work, and could leave.
Set up regular meetings for you to review staff performance, and for staff to provide feedback about their goals and achievements.
Provide support where needed
Seems obvious – but there are managers who really don't care about their staff and make no effort to show interest.
Get to know your staff. Find out what's happening in their lives, what motivates them, and offer your assistance and support when they need it.
Be people-proud and committed
You want staff to take ownership and feel proud of what they do. What actions do you take to ensure they feel important and passionate about the product or service your business provides?
Some businesses have a community commitment, which creates a shared pride in what's being achieved.
Encourage your staff
To get involved in decisions
Ask staff for opinions and ideas, and listen to what they have to say. This will make a – this makes a huge difference and will provide an environment that's open to innovation and improvements, creating job satisfaction.
To provide feedback
Encourage your staff's input, ideas and feedback, as well as day-to-day feedback discussions.
Be open to giving and receiving positive and constructive feedback – this is a great way to establish an open and honest culture in the workplace. Some managers forget that they're role models.
Visit our page on communication skills for managers to set up proper feedback channels.
To develop new skills
Promote learning and opportunities to develop new skills, because staff need to know there's a positive emphasis on gaining new skills.
Do you have recognition for learning and developing new skills? Learning is about developing new skills and improving the ones you have. Give people the opportunity to grow – they'll tell everyone what a great employer they have.
Organise regular fun activities
People need to take a break from work to share in some fun moments. This could be a casual day, an afternoon tea with a difference – perhaps with culturally focused food, trivia competitions, or a team outing for lunch.
Find a way to build this as a regular part of your workplace.
Now that you've take steps to make sure your employees are appreciated and happy, take the next step and create a desirable workplace for prospective candidates.