One of the big keys to running a successful business is to retain your best employees, and the data backs that up. In 2017 a study was done by the Work Institute that estimated it can cost 33% of an employee’s annual salary to replace them. According to PolicyAdvice, in 2021 the approximate average salary of an employee was $51,480 which means to replace an employee at that salary level would cost your company nearly $17,000.
It seems obvious, then, that it’s much better to invest in retaining employees than to have to deal with the expense of consistent turnover. During this time of the “Great Resignation” when so many are leaving their jobs, how can you work to retain your best employees?
In my work as a blue collar business coach working with everyone from custom home builders to factory owners, I’ve come up with five tips that seem to make the biggest difference when it comes to employee retention.
1. Incorporate flexibility into your employees’ schedules
It’s wise to think through if you need your employees in the office, or if they can do their work from home. It can also be wise to think through if they need to be on a 9-to-5 workday, Monday – Friday, or if there’s room for flexibility in those hours and days.
Sometimes, of course, the answer will be “Yes, I need you in the office on these specific days and times.” But often, asking your employees about what works well for them can lead to an arrangement that works well for everyone. Perhaps you have an employee who works better from home, without a long commute added to their day. Perhaps another employee prefers to be at the office for work. Maybe the best hours for one of them is on Saturdays or later in the evenings when they can focus without distractions, instead of a typical 9-to-5.
2. Ask and listen
You won’t know what works best for your employees until you ask them. You want your business to run impactfully and efficiently, but top-down decisions aren’t necessarily the best way to get there. When you rely on input from your employees, you’re most likely going to end up with a higher-yield business in the long run.
Set up ways to receive feedback from your employees by asking pertinent questions and allowing them to give feedback in a safe and direct manner.
3. Recognize your employees
People like to be thanked and appreciated for their work, so recognizing employees needs to be an important part of your business.
Gallup did a study a few years ago of the American workforce and the study showed that only one in three employees strongly agreed that they had received recognition for doing good work within the last seven days. The Gallup data also showed that people who don’t feel appropriately recognized are twice as likely to say they’ll quit in the next year.
The simple act of creating a recognition program for employees within your company can help you retain employees.
This can take the form of an Employee of the Month program or a spotlight at company meetings or a feature in the company newsletter. Gifts are nice incentives to go along with these recognition programs, but if you don’t have the budget for that, a personal note or complimentary words shared in a public setting can go a long way.
4. Think beyond the initial employee training
The importance of initial training for a new employee is critical. There’s the human relations onboarding, the deep dive into company policies, and a thorough introduction to your company’s culture. But are you following up two months after the initial hire? What about six months later?
New employees can give you a great deal of information about both your recruiting and your onboarding processes, and they can also give you a fresh take on your company culture. New employees will be trying to put their best foot forward with the company, and it’s important that your company does the same.
Getting new employees’ feedback ensures that they are happy with their role and with the company at large and helps encourage them to stay and grow within the company.
5. Professional Development is important – for your employees and yourself
Employees who are given the opportunity for professional development and who understand the expectation of growth culture will stick around. Keeping professional development as a core expectation within your company ensures that your employees are not becoming stagnant and bored. It also allows them to grow into leadership positions within the company.
Sometimes professional development can look like a mentorship program within the company, other times it can be investing in someone to come and speak to your employees or lead a workshop. The time and effort devoted to professional development convey to your employees that you care about their growth and success within the company.
The key takeaway
Remember that there is value in helping your employees have an open dialogue with management, an understanding of a clear mission, and knowledge of the expectations for their success within the company as well as the company’s overall results. Retaining employees and ensuring their happiness within the company is best for your bottom line.