The 10 Best Ways for Improving Employee Retention and Satisfaction
Improving employee retention should be the goal of any company. But unfortunately, business owners and managers of every industry are constantly dealing with high employee turnover, which are employees who leave voluntarily or involuntarily.
According to the U.S. Bureau of Labor Statistics, three million Americans quit their jobs every month. High employee turnover has a profoundly negative effect on a company’s productivity because HR managers must continue recruiting and training new talent.
Here are some shocking employee turnover statistics from the 2017 Human Capital Benchmarking report:
- The average company experiences an 18% employee turnover.
- The average company loses about 6% of its employees due to layoffs and firings.
- The average company loses about 13% of its employees because they quit or leave voluntarily.
- The average company has a 3% average turnover of high-level job positions.
The BLS indicates that the median number of years employees stay with employers is 4.1 years. These are devastating results that demonstrate a lack of employee satisfaction.
The Importance of Improving Employee Retention and Satisfaction
A company that fails at improving employee retention will experience less growth and more expense. Here are the average costs of high employee turnover:
- Replacing one employee can cost a company up to double the employee’s salary. For example, replacing an employee who made $50,000 per year would cost the company around $100,000.
- High turnover rates at companies with a minimum of 100 employees cost as much as $2.6 million annually to replace them.
- Roughly 75% of companies claimed to have hired the wrong people before. The average cost is $14,900 to replace an individual employee.
Company culture significantly impacts whether employees want to stay at their jobs or leave prematurely. That is why it’s crucial to create a workplace culture of wellness and understanding amongst the employees and management. If your employees are satisfied with the culture, it will improve employee retention quickly.
The Best Ways of Improving Employee Retention
A good manager must develop a strategy to improve employee satisfaction in their positions with the company. Once the plan gets implanted, it won’t take long for the employee turnover rate to decrease significantly.
Below are the top 10 best ways to simultaneously improve employee retention and satisfaction.
1) Wellness Programs
Wellness programs increase employee engagement, satisfaction, and productivity in the workplace. They stimulate the core elements of their happiness for improving employee retention, such as their emotional, physical, social, mental, and financial wellbeing.
Some examples of effective employee wellness programs which address these core elements include the following:
- Gym membership discounts
- Flexible work schedules
- Nutritious on-site cafeteria food
- Social programs and team building
- Mandatory breaktimes for walking or fitness activities
- Stress management programs
- Natural décor and greenery
- Financial incentives and rewards
Employees want to feel like their health and wellness needs are getting met. So if you give them opportunities to improve multiple aspects of their health that they cannot get anywhere else, it will make them feel satisfied at their jobs with no reason to leave. That is how you improve employee retention through wellness.
If you give them opportunities to improve multiple aspects of their health that they cannot get anywhere else, it will make them feel satisfied at their jobs with no reason to leave.
2) Acknowledge the Achievements of Your Employees
Employees want to feel like they matter in the company. If you can acknowledge their achievements whenever they complete short-term or long-term goals for the company, it will make your employees feel better about their work. Why would they ever want to quit if they feel good about what they are doing?
Passing down praise and acknowledgments to your employees doesn’t cost you anything other than some time and effort. Of course, you can give out small rewards to show your appreciation to employees, but it is not always needed. A simple verbal acknowledgment alone can make an employee feel better about their job at the company.
Here are some affordable ways to acknowledge the achievements of your employees:
- Hold a staff meeting where you recognize the achievements of one or more employees. All their colleagues will get to hear the praise, making them want to work harder themselves to rise to the same level.
- Post up an “employee of the month” plaque on the wall or some similar display of appreciation.
- Add a recommendation on the employee’s LinkedIn profile so that other people can see the value of their work.
- Send a mass email or newsletter to all company employees and acknowledge the achievements of specific employees in the message.
Acknowledgments are one of the easiest ways of improving employee retention and satisfaction.
3) Pay Competitive Wages and Salaries
A big reason for high employee turnover is the low wages and salaries paid to workers. Corporate greed and reduced benefits are a sure recipe for boosting turnover because they don’t satisfy employees’ financial, health, and lifestyle needs.
Therefore, offer liveable wages to your lower-level workers and generous salaries to your management and upper-level employees. Paying competitive wages and salaries ensures that employees won’t find better job offers anywhere else.
A 2015 Newsweek article listed the following reasons why workers should get paid more:
- Increases employee motivation to work harder
- Attracts more skilled and competent workers
- Reduces employee turnover and hiring and training costs
- Employees perform better quality work
- Employees take fewer sick days and vacation days
- Employees perform better customer service
- Less supervision is needed for long-time workers
- Reduces employee stress, which increases employee productivity and happiness
As you can see, there are plenty of other good reasons to pay workers more money besides improving employee retention. Your employees will work harder, produce better quality work and take less time off.
4) Act Fair and Respectful
Remain fair and respectful with each employee you interact with at the workplace. Don’t let your managerial authority get to your head by acting bossy or overbearing. The relationship between employees and managers can ultimately affect employee retention and turnover.
If an employee makes an honest mistake, don’t shout or scold them. Instead, teach them how to avoid making the same mistake in the future. Sometimes an employee only needs some direction and understanding from their leadership to improve productivity.
Here are the reasons why showing respect at work to your employees is essential:
- Reduces employee stress
- Increases employee productivity
- Enhances employee satisfaction
- Promotes equality and fairness amongst employees
- Encourages employee collaboration and teamwork
- Reduces the number of employee mistakes on the job
Simple acts of kindness and respect could be the deciding factor in whether an employee stays or quits. So make the right choice and be kind.
5) Offer Remote Work Options
Employees appreciate workplace flexibility. A job with remote work options is a dream for many employees, especially if they have kids to care for at home. If you allow employees to work from home, they will love the freedom you provide for their job.
Now, it is true that some employees need daily social interactions to be successful and productive. That is why remote work should only be an option rather than a requirement. Allow employees to choose whether they want to work at the office or at home.
Freedom and flexibility are vital for improving employee retention. Here are the other benefits of offering remote work options:
- Employees won’t have a daily commute to work, so they can save money on gas and not worry about showing up late.
- Employees will experience less stress and anxiety because they won’t have a boss looking over their shoulder every minute of the day.
- Employees can easily balance their personal life and work-life by setting their own work schedules.
- Employees can take unscheduled breaks at times most convenient for them.
- Employees have more independence to work from anywhere, such as in other states, rural communities, etc.
- Employees can promote environmental protection and friendliness because of the reduced traveling.
Remote job positions are the wave of the future. Any company wishing to improve employee retention must offer these options and create strategies for their remote workers to succeed.
Any company wishing to improve employee retention must offer remote options and create strategies for their remote workers to succeed.
6) Screen New Job Candidates Thoroughly
Improving employee retention starts with hiring the most suitable job candidates. Your management or human resources department must screen new job candidates thoroughly to ensure they fit your company perfectly. Otherwise, high employee turnover is inevitable.
Unqualified or unsuitable job candidates will turn into disengaged employees. According to Quantum Workplace’s 2020 Employee Engagement Trends Report, disengaged employees are over three times more likely to quit their jobs within the first three months than engaged employees.
Perform the following actions when screening each job candidate:
- Review resumes
- Review cover letters
- Contact the references of the job candidates and verify their qualifications
- Interview each job candidate on the phone or via a video conference
- Interview the top job candidates in person
- Review the skills of each job candidate and see which ones align with the open job positions
- Conduct personality assessments to see which job candidates have values and traits aligned with the company.
Hiring the most qualified and suitable employees is a big step in improving employee retention.
7) Offer Incentives and Rewards
Employees are happy at their jobs if offered incentives and rewards to work harder and increase workplace productivity. Without good incentives, employees will do the bare minimum on the job without any care to improve productivity for the company.
Some examples of high-quality incentives and rewards include the following:
- Paid time off
- Gym membership discounts
- Free access to a personal trainer or nutritionist
- Gifts and prizes
- Reducing the cost of monthly healthcare insurance premiums
- Contributing to a retirement or healthcare fund
- Sports equipment
Choose the most effective and creative ways to incentivize your particular employees. It all depends on your company culture.
8) Create an Attractive Work Environment
Most employees don’t want to stare at solid white-colored walls in an office for 8+ hours per day. That would make any human being want to quit within the first year.
Attractive workplace décor has never been more critical to have in workplaces. Modern employees want an engaging work environment that looks vibrant and creative. If you can establish such an environment in your company, it will go a long way in improving employee retention.
Here are some ways to create a more attractive work environment:
- Add greenery and plants throughout the offices and workspaces.
- Repaint the walls and use vibrant and diverse colors.
- Provide comfortable chairs and furniture for your employees to use.
- Increase outside visibility by installing more windows.
- Provide more natural lighting for your employees indoors.
You can have fun with this one. Find different ways to spice up the appearance of your workplace. You’ll be surprised how well your employees respond to it.
9) Offer Mentorship and Training Programs
It can take a long time for new employees to feel comfortable in your organization. If they feel like they don’t understand the company culture or how to adapt to the work environment, they will be compelled to quit.
One way to tackle this problem is to offer mentorship or training programs to new employees. For instance, you could assign a mentor to train and guide each new employee on how things work in the company. It will give the employee a chance to receive hands-on training and education to adapt to their jobs better.
Here is how mentorship and training can benefit employees and improve employee retention in the workplace:
- Creates a workplace culture filled with diversity
- Develops employees into leaders
- Increases productivity
- Allows employees to grow and develop in their careers with the company
- Establishes a learning culture with opportunities for employees to improve themselves
- Decreases employee turnover
Your existing employees should also have access to mentorship and training programs too. Since company culture and technology can evolve, you may need to retrain existing employees on how to adapt to a changing work environment.
10) Create a Strong Bond with Employees
Employees shouldn’t look at their workplace as a dreadful and depressing environment. When you see a high turnover, it usually means that employees don’t like the company culture or leadership. Only you have the power to change that.
When you see a high turnover, it usually means that employees don’t like the company culture or leadership.
Do you have a friendly relationship with your employees? It helps when your employees feel comfortable talking to you like you’re their friend rather than a boss. That would make them want to stick around for a long time because employees love a job where they get along with their boss.
Here are some ideas on how to create a strong bond with your employees:
- Create an open communication system where employees can easily and comfortably share feedback and information with management.
- Guide and support your employees without being overly critical or judgmental.
- Compliment employees and show them your gratitude and appreciation for their hard work.
- Offer rewards and opportunities to employees who are productive and engaged.
- Show an interest in your employees’ personal lives and goals. You don’t have to get too personal, but show your employees that you’re a human being who has personal struggles and issues as they do.
If you can successfully create a strong bond with employees, motivating them to work harder and increase productivity will be easier. Best of all, it will go a long way in improving employee retention.
How to Get Started With Improving Employee Retention
Do you need help developing strategies for improving employee retention in the workplace? Schedule a free demo with our team to learn which wellness programs are best for increasing employee retention at your company.