Ellie Batchiyska — November 7, 2018 — November 7, 2018
geralt / Pixabay
Time and time again, you find your business relinquishing and replacing employees. This routine is not unlike tending a garden. At first, you might not kick up much of a fuss over the fact that your flowers keep wilting. You tell yourself: “Next spring, it will be different.” You even resort to blaming the flowers themselves. Maybe that particular flower type is overly sensitive and wilts quicker than the others.
You’ve planted various species of flora to no avail, and it comes time to admit you may need to reassess your gardening abilities.
Your employees are the flowers. Initially, managers are tempted to believe short-lived employees are undisciplined. After one too many resignations, however, it’s probably time to admit your business needs to take a good, hard look at itself. After all, high turnover is nothing to brush off. Hiring and re-hiring on a constant basis costs companies a significant amount of money.
The Cost of Constant Turnover
The Society for Human Resource Management found that employers need to spend the equivalent of their average employee’s six to nine month salary in order to find and train a replacement. Think about it: finding a qualified employee requires more than just time (although time is of high value, as well).
Employers spend hundreds to thousands of dollars on recruiting, whether it mean using a staffing agency or paying for subscriptions to job search sites, such as Indeed, Monster, etc. Job fairs hike up this amount even more.
Drug testing, skills testing, and personality testing contribute an added expense. Signing bonuses and severance packages are notwithstanding. The stakes are even higher for high-caliber companies who require more of their workers, such as relocation.
Circling back to the value of your time, however, is most prudent. When your HR department and executives are constantly interviewing, their precious time is being distracted from more profitable tasks. Furthermore, business expert Josh Bersin estimates that it takes a new employee up to two years to reach the same level of productivity as a long-standing employee. If your employees rarely reach the two-year mark, you’re looking at declines in productivity across the board. Which, naturally, means declines in profits.
The Cause of Constant Turnover
More than likely, the cause of constant turnover is an internal issue. One of the biggest reasons is poor management. In fact, a common saying has even come to light in the business world as a result of this: “People don’t leave jobs, they leave managers.” Ineffective leadership leads to poor employee engagement, and studies show that managers account for 70% of the variance in engagement.
Feelings of being under-appreciated also lead to high turnover. So much so, that researchers cite it as the top reason employees leave their jobs. Going hand-in-hand with under-appreciation is improper pay. When not motivated by adequate pay and benefits packages, employees tend to burnout and work less productively, until they leave altogether for better offers.
Suffice it to say, all reasons for high employee turnover are symptomatic of general mismanagement.
The Cure for Constant Turnover
The most important change to make in favor of employee retention is a re-evaluation of your company’s upper management. Poor managers are not always bad people. They’re often just people who don’t necessarily possess leadership qualities – no matter how well they know the industry or field in which they work.
A good leader is sensitive, intuitive, and approachable. They should have an altruistic quality about them that is both strong and inviting. It’s important your managers not only possess knowledge of their industry, but indomitable people skills. Many managers misconstrue this as the job of HR personnel. While HR is there to provide guidance, managers are responsible for cultivating a friendly and productive work environment.
In addition to reassessing your company’s leadership, you should also explore employee incentive programs. Invest in professional development and project-centered bonuses. Implement an employee recognition strategy to increase workplace morale. One way of doing this is by encouraging all employees to anonymously recognize a different co-worker for a job well done each week. Reward the employee with the most votes at the end of the week by gifting them a free lunch or a gift card to their favorite restaurant – a small price to pay for keeping your employees happy.
Most importantly, however, is that managers never underestimate the value of a “thank you.” This gesture alone will encourage your employees to stick around. Increased positivity will lead to increased productivity, which in turn will lead to increased profits. In time, as your company grows, your employees’ loyalty will grow with it.
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