Master Employee Retention in 7 Steps
In today’s competitive job market, retaining great employees is more crucial than ever. High turnover rates can lead to increased costs in hiring and training and can overburden current staff. To maintain a strong team, companies must prioritize employee satisfaction and engagement. A proactive approach to retention helps businesses build loyalty, improve productivity, and cultivate a thriving workplace culture. Let’s find out how!
Why is employee retention important?
The competition for top talent is fierce. Today’s workforce is more educated and capable than ever, but they have also turned out to be quite unpredictable.
Companies have realized that they need to be more proactive to avoid losing their best employees. Employee retention rate is an important metric to track to make sure that people don’t leave too soon. Otherwise, they will end up with increased costs of hiring and training new employees, as well as putting too much pressure on current staff.
Have you ever heard of the term “quiet quitting”?
Different generations entering the workforce have followed the prevailing work norms and regulations. Back in the day, it was not uncommon to run a factory where workers clocked in and out. Anyone who came late risked a reprimand, getting fired, or having their daily salary reduced. Workers went to the dock to compete for job assignments in the morning, in line with a “first come, first served” policy. A strong mindset and always being on time were key around 60 years ago.
However, times are a-changing, as the great Bob Dylan once put it. Newer generations such as Gen X have become more innovative and entrepreneurial. Late millennials are known for their individualism. With Gen Z entering the workforce, the term “quiet quitting” emerged. Fueled by the pandemic, people realized that they wanted to work more on their own terms. Employees also wanted to make sure that their salary actually reflected their daily tasks. Why get paid the bare minimum and work long hours?
Instead of resigning from jobs they loathed, people began to slowly take on fewer responsibilities and go under the radar.
Other reasons for leaving can be lack of support, no career advancement, toxic colleagues, or boring, mundane tasks.
With this in mind, crafting a great retention strategy should be a top priority.
How to increase employee retention
The first step is to face the facts: you need a strategy!
The next step is to improve various aspects of the working environment and management style, to name a few. Below are some suggestions.
1. Adopt a hybrid work model
Ambitious professionals crave autonomy and flexibility. This means they can set their own schedules and tailor their daily tasks to suit their needs.
As long as deadlines and goals are being met, employees should have the freedom to work on their own terms. One of the best things you can do to keep employees happy is to adopt a hybrid work model and allow them to work from home a few days per week.
In addition to having a flexible schedule, employees don’t have to spend time commuting and will achieve a better work-life balance. More time can be spent with family and friends. There may also be fewer distractions at home compared to a noisy office.
2. Reduced workdays for an improved work life balance
It has been debated whether the traditional 9-to-5 work schedule is truly the best option. After all, it’s the number of productive hours that should matter, not just being physically present in the office.
By reducing the number of office workdays, many people may actually become more productive. It’s better to achieve a balance rather than becoming a workaholic and risking burnout or depression.
3. Improve company culture
To increase employee retention, it is important to maintain a great work environment where people are genuinely happy to work every day. One of the most important factors is inclusivity.
Everyone brings something unique to the table, but they should expect to be treated equally, regardless of their personality, gender, origin, or preferences. Working as a team and making employees feel like they are part of something special is an added bonus.
Here are some other components that contribute to a great company culture:
- People feel seen and heard
- Management is respectful and fair
- It is OK to voice your opinion
- Efforts are not taken for granted
- People elevate others and don’t take credit for someone else’s work
4. Boost the physical work environment
Improving the physical work environment is worthwhile, as our surroundings significantly impact productivity and motivation.
We offer Flowanalytics for the hybrid office. Workplace Analytics gather data on employee preferences and workspace utilization, providing insights to inform strategies that enhance the work environment.
It becomes easier to clean and maintain spaces when you understand room occupancy patterns at different times of the day. This allows you to stock up on cleaning supplies, toilet paper, and install the right amount of water coolers.
FlowPlanner can further boost retention by helping employees plan their workweek effectively, ensuring they can collaborate with colleagues and work in spaces that meet their needs. No more running around looking for teammates—it becomes easier to get to work right away.
5. Great job perks increase employee engagement
Hybrid work and flexible hours can form the foundation of your employer branding, attracting talent to the company and encouraging employees to stay. But don’t forget about the small job perks that make you stand out from the crowd.
Get creative and offer something unique. It could be a professional chef in the canteen who sets up a backyard barbecue, a rooftop patio with Wi-Fi, or a fruit basket. Anything that adds a little extra charm.
These small events and perks also serve as opportunities for people to meet and mingle, acting as a kind of workplace totem. There's a good chance employees will mention these perks to acquaintances and clients, which can serve as an incentive for others to join the company in the future.
6. Benefits and pay
Did you know that 35% of employees will look for a new job if they don’t receive a raise within a year? It’s safe to say that recognition alone isn’t enough—people want their paycheck to reflect their manager’s appreciation as well.
Wages should be adjusted according to the cost of living and take factors like inflation into consideration. A significant wage gap between management and staff can trigger discontent.
Besides the paycheck, there are other benefits that can foster motivation and loyalty, such as career advancement opportunities, training, and new responsibilities. You might also consider offering fitness programs, discounts on massages, and other wellness activities.
7. Understanding employee retention rate
There are some interesting facts and statistics regarding employee retention rates. In general, anything above 90 % is a good retention rate.
It is calculated by dividing the number of employees at the end of a set period by the number at the start, then multiplying by 100 to get the retention rate percentage.
Remote workers are 50 % likely to quit compared to those who commute to the office every day. While it can be complicated and expensive to train remote employees, data shows it can also be worth the effort.
Another interesting aspect is that people tend to consider quitting during the first year, with up to one-third of new hires doing so. This highlights the importance of effective onboarding and clearly communicating expectations and goals. Another common pitfall is inaccurately describing the job position, which can lead to a mismatch between expectations and reality.
As mentioned earlier, company culture is a key factor in higher retention rates. Management plays an important role in creating a positive work environment, but employees also contribute significantly. When people work well together and teamwork is strong, they are more likely to stay with the company.
It's no surprise that referred employees tend to be more loyal, as they often work with someone they already know, like, and trust.
In addition to retention rate, another important metric is turnover rate—the percentage of people leaving during a certain period. A turnover rate over 10% should be considered alarming.
Be aware of the limitations
All of our suggestions above can be useful, but ultimately, you will need to tailor these strategies to suit your company.
Not everyone can offer fully remote jobs or allow employees to work from home four out of five workdays. If you can’t meet every employee’s needs, you can at least try to make up for it in other areas.
It’s always the employee’s decision when and why they choose to leave the company, and it should always be followed up with an exit interview. Take this opportunity to ask for feedback to avoid repeating mistakes in the future. A person quitting could be a symptom of a larger issue, or perhaps the individual simply wasn’t a cultural fit.
Employee retention strategies drive growth
In conclusion, retaining top talent requires a thoughtful and adaptive approach. Companies that invest in their employees through flexible work options, competitive benefits, and a positive work culture are more likely to keep their top performers.
Understanding what drives employees—whether it’s career growth, fair compensation, or a balanced work-life dynamic—increases retention.
By regularly assessing employee satisfaction and responding to their needs, businesses can foster long-term loyalty and reduce costly turnover.
Ultimately, focusing on retention not only strengthens the workforce but also enhances the company’s overall success and growth.
Want guidance on how to set up your hybrid office for success?
Feel free to schedule a meeting with one of our product experts to learn more about our solutions and how technology can help you streamline your office processes without interfering with employees' day-to-day work.