Roughly 17% of employees leave within three months of starting on a position, according to BambooHR. Talk about a short honeymoon period! One minute your latest employee has that new hire glow and the next, they are brainstorming terrible excuses to miss work and interview elsewhere.
High employee turnover can damage employee morale and workplace culture, as well as the company bank account (replacing team members often costs tens of thousands of euros). Use this guide to uncover answers to some of the most frequently asked questions about employee retention and turnover, so you can build a happier, more productive team.
How do you measure retention rate and turnover rate?
Tip: Looking to calculate the full price of replacing an employee specifically for your company? Download our new Onboarding Whitepaper for your custom formula as well as tips on ensuring employee retention from day 1.
Should my company track retention AND turnover?
Absolutely. Tracking one only provides part of the picture. For instance, Company X has an annual turnover rate of 33% but an 80% retention rate. If it only tracked retention rate, Company X may not realize how many employees are leaving on a regular basis.
What are “good” retention and turnover rates?
Get your bearings with some external benchmarks, like industry standards or figures from competitors. For instance, Monster reports that the average employee turnover rate in the UK is 15% a year with much higher rates occurring in the retail, catering, call center, construction, and media industries.
Then, use these external benchmarks to determine internal benchmarks for retention and turnover rates. A “good” range ultimately depends on your company. If you think that your employee retention and turnover rates aren’t ideal, use the following strategies for improvement.
How about strategies for higher retention and lower turnover?
1.Invest in onboarding
Don’t just dazzle and then leave employees to themselves. Spend as much time and energy wooing them after they join the company as you do during recruitment. Talmundo’s research determined that top companies with structured onboarding programs retain 91% of their employees, versus 30% retention rates at organizations without formal onboarding.
2. Promote one-on-one time between new hires and managers
You have probably heard it before: “People leave managers, not companies.” In fact, employees are 54% more likely to quit when working with a toxic person, especially if that person is their manager. Head trouble off at the pass—consistently carve out time for new hires and managers to get to know each other.
3. Set clear job guidelines (before and after hiring)
Employees quit within the first six months, according to Bamboo HR, for two particular reasons:
I didn’t want to do the work anymore
The work wasn't what I expected
Misaligned expectations mean trouble in paradise. Clarify the scope of the role during the hiring process and then reiterate it on day one so employees don’t feel blindsided by extra responsibilities.
(Speaking of day one: cut through the mountain of first day paperwork with an awesome company fact sheetthat introduces your organization and say no to those dreaded HR binders.)
4. Recognize great work
93% of employees would like to receive recognition from superiors at least once a quarter. No need to rent the conference room; informal recognition and a quick comment or a thank you note can motivate new employees who haven’t quite found their footing.
5. Bring new hires into the fold
The University of Ottawa found that being ignored or excluded led to greater job turnover than workplace harassment. Make new hires feel like they are part of the team by having their workstation ready when they walk in the door, involving them in social activities around the workplace, and providing an organizational chart to help with pairing names to faces.