Why employee retention is more important than ever
In the business world, employee retention is certainly a hot topic of discussion. Businesses are having to work extremely hard to hold onto its employees. As competition begins to rise, it is evident the importance of employee retention.
Factors dictating employee retention
Employee retention is one particular area a business can improve on, in maintaining performance and productivity. The smallest of gestures makes the biggest difference in showing appreciation and solidifying long-term working relationships.
The results may surprise you of why employees decide to stay in their role. Retaining and fostering loyalty from your current employees requires more than a good salary or remuneration. Research has revealed the top five reasons why employees stay in their position. These include:
- Pay/remuneration (57%)
- Friendly co-workers (55%)
- Feeling appreciated (51%)
- Flexible work (47%)
- Good management (43%)
Therefore, reasonable pay coupled with a healthy and sustainable work culture is what encourages employees to solidify work roots.
Additionally, natural reasons arise, as to why an employee chooses to leave the business, including feeling ready to take on the next challenge or experiencing a change in career paths. Surprisingly, pay is not the number one reason why an employee will leave their role. These are a dislike for work culture, followed closely by a dislike of the company’s management style. Other reasons include:
- Dislike of work culture (59%)
- Dislike of management (58%)
- Remuneration or feeling underpaid (51%)
- No pay rise over duration of employment (43%)
- Inflexible work hours (41%)
A positive company culture is proving to become an increasingly valuable asset when it comes to productivity. Therefore, one thing is for certain, CULTURE IS KEY is retaining employees! They use this as a determining factor in deciding whether to accept a job offer or leave their current position. Research reveals that, 1 in 4 employees (25%) look for a strong work culture, which also offers team and company level activities. 1 in 3 employees (33%) will stay in the position longer if there is a stronger work culture and are more inclined to leave a role if they are unhappy with the benefits on offer.
What does this mean for the future?
As these results indicate, the Australian workplace landscape is shifting. A flexible workplace is becoming more desirable among employees, with pay is not being a substantial enough reason to sway an employee who dislikes company culture and management. A loyal employee is influenced by both pay and culture. Therefore, establishing a healthy work culture is important to employer success.
Moving forward, focus needs to be shifted on retaining millennial employees, given that they are beginning to make up a large percentage of the employee landscape. Though they have the propensity to job-hop, they do actually care who they work for and are genuinely capable of showing loyalty to their employer just as much as the previous generations before them. However, they are more likely to take risks and engage with new employment opportunities.
This demonstrates millennials are becoming increasingly uneasy about the future. Gaining recognition makes employees feel good. It lets them know their contribution to the greater good of the team and deepen their understanding of core business values and culture. Businesses must therefore commit to building a solid foundation, based on strong company culture. Offering those incentives including decent pay, workplace flexibility and a positive company culture are great ways to retain these employees.
Businesses are always on the hunt for prodigious talent. Unfortunately, personable, skilled, experienced and qualified employees are sometimes hard to come by. Begin to think about how to accommodate and retain employees. When businesses are flexible with how and when work is done, your talent will increase significantly. However, you must remain diligent in offering positive affirmation, feedback, incentive and recognition to all employees.