You’ve Hired Them, Now How Do You Keep Them?
It’s no small expense to hire a new employee. One estimate puts it at $7,645 to recruit, screen and train a new recruit. As significant as that is, the bigger question is: What’s the return on investment? A key contributing factor is how long employees stay with you after they’re hired. That’s why it makes sense to protect your investment by focusing on retention strategies. Take a look at these ideas to retain your most valuable asset—your employees.
Why Do Employees Leave?
Over 68% of small and medium-sized businesses experienced turnover in the last year. So why did they leave? Capterra surveyed over 300 people who left their job at a small business within the past two years. Here are the top reasons they cited for quitting their job:
- Poor compensation and/or benefits
- My manager
- Poor work-life balance
- Limited career progression
- Company culture
- Family or personal reasons
- To pursue a different profession
- My co-workers
What’s the big takeaway from this study? Only one deals with money. While salary is important, there’s a significant opportunity to address retention without breaking your budget. In fact, the same study reports that 70% said their employer could have done something to keep them from quitting.
5 Ways to Retain Your Best Employees
You’ll want to look at the issues impacting retention in your own business, but here are some budget-friendly ideas you can use to retain employees.
Start before they’re hired.
Employee retention doesn’t begin after they’re hired. There are things you can do during the hiring process that will influence it. First, be sure your description of the job accurately reflects what they will be doing. Some businesses have applicants talk to a current employee to get a first-hand look at what’s it’s like.
Another idea is to give applicants a chance to “sample” the job. For example, someone applying for a sales position might go on a call with a current salesperson.
Conduct stay interviews.
Don’t wait for an employee to leave before you gather information. Ask your current employees by conducting “stay interviews.” The goal is to learn what makes employees stay. Their answers can help you decide what action will have the greatest impact in your retention efforts.
The interview could be part of your weekly coaching sessions or an anonymous online survey. Here are potential questions: Why did you come to work here? Why have you stayed? What would make you leave? What would you change or improve?
Provide a path for development.
The top reason younger people (ages 18-25) leave is limited opportunities to progress. They want to grow their skills and advance along their career path. So it’s important to provide development experiences.
Development can take many forms. Here are a few low-cost options: allow employees to take online training during the business day, use your weekly one-on-one coaching sessions to identify what skills the employee needs before they can take on more challenging work, assign them to give a how-to presentation to other employees on a new software program, cross-train them on another position.
Some managers think their job is to catch employees doing something wrong and correct them. But a more productive approach is to observe them doing well and celebrate it. Sometimes it’s just a matter of saying “Nice job, I really appreciate how you _____.” The important thing is to recognize it as soon as possible and be specific about what they did right.
Here are some ideas: employee of the month, shout-out at the beginning of the day, special parking spot, food day, a coupon for two hours of free time, first dibs at working on a new project. Remember, rewards are individual-based. Some employees love public recognition while others shun it.
It would be easier if one size fit all, but that rarely applies to individuals. It ignores each employee’s unique characteristics (and contributions). So be receptive to individual needs where you can. Most employees will understand you can’t grant every request. But there’s equity in trying.
It can be as simple as allowing an employee to come in early so they can take off early to attend their child’s school program. Another might be allowing them to work from home one day a week.
It makes sense to put as much effort into retaining an employee as it is to hire them. Increase the return on your recruiting investment by considering these ideas to improve retention.