Retention – A Discussion of Stats and Strategies
Written by, Marjan Markovski
Historic low unemployment near 4% combined with a declining population growth rate and increased job growth rate has created an unprecedented demand for qualified employees. These employment conditions also create an abundance of options for employees. Today, employees have options and the strong economy has eliminated the fear of exploring those options. As the competition for employees heats up, employers must act quickly to attract new employees and retain their existing workforce.
In 2017, 38 million employees quit their jobs. Work Institute estimates the cost of turnover is roughly 1/3 of the employees’ annual salary. By 2020 the projected cost of turnover to U.S. companies is expected to be nearly $680 billion. Cost of turnover is rising, companies must retain their workforce. The good news is 77% of employees who quit their job could have been retained by the employer by addressing needs of their workforce.
According to over 34,000 exit interviews conducted in 2017 by Work Institute, the top three reasons employees decided to leave their current employer are Career Development, Work-Life Balance, and Manager Behavior. These three categories remain consistent with trends we have been seeing for several years now.
In various professions and industries, these pain-points are easier to remedy than others. How can we apply best principals to the light industrial and general labor sector where differentiation amongst employers is challenging?
1.) Offering training to employees to expand their skillset and move into higher paying positions. Having a formal training program will provide your employees with the opportunity to earn more and see a long-term career path with your company.
2.) Offering flexible schedules to help employees manage the unexpected life events. In the manufacturing world, strict attendance policies leave employees without the luxury of flexible schedules. Often employees are forced to chose between their job and caring for a sick child or another life event. Providing a flexible schedule can help your employees keep their job and handle emergencies. Not only does this show your employees that the company cares about their well-being it also helps reduce unnecessary turnover.
3.) Provide frontline managers with periodic training to ensure best practices are followed. Managers are required to motivate and engage their employees. Training with a focus on communication, professionalism, and engagement will make your workforce feel valued, welcome, and more productive.