Many industries are facing talent shortages with most open positions receiving two or three applications on average. According to the Bureau of Labor Statistics’ most recent Employment Situation Summary, “Both the unemployment rate, at 4.2 percent, and the number of unemployed people, at 7.1 million, changed little in March. The unemployment rate has remained in a narrow range of 4.0 percent to 4.2 percent since May 2024.” So, unless drastic changes are seen in the market, it’s important to retain talent you do have to prevent hiring struggles from ballooning further.
It’s time to get creative with employee retention strategies and ensure that the benefits and perks your company offers meet the needs of your team. I’ve gathered a few strategies that retain top talent and reduce employee turnover.
Invest in Salaries and Unexpected Benefits
It’s no surprise that salary is an important factor in keeping your best employees and lowering turnover. But although it may feel expensive to offer competitive compensation, consider the costs that come with high employee turnover rates. According to Gallup, “The cost of replacing an individual employee can range from one-half to two times the employee’s annual salary — and that’s a conservative estimate.” Training new staff and decreased team capacity are costly, and it’s more cost-effective to head this off by providing competitive compensation.
Salary is not the only form of compensation. There are other perks of value that can help retain top staff. If your office provides uncommon benefits like technology stipends for remote workers, paid parental leave, childcare assistance, and tuition reimbursement, employees may feel your company values their contributions. Showing appreciation for their efforts leads to employee loyalty and satisfaction, making them more likely to stay with a company. Focus on easing the burdens your employees face, when possible, through competitive benefits packages and unexpected workplace perks.
Career Development and Training
Another non-compensation perk that leads to employee satisfaction is career development and training. Your employees want to develop skills and talents that make them resilient in the workplace. It’s also in your best interest to increase team efficiency and knowledge by aiding employees in attaining new skills.
When it comes to professional development, there are nearly endless ways to develop your staff. Mentorship programs where seniors mentor junior colleagues are a “free” but effective way to advance the skills. Beyond passing on skills, mentorship and coaching programs provide opportunities to discuss potential career pathing, development opportunities, and career advancement that may be of interest to junior team members. Development programs such as “internal universities” also develop talent at scale.
Employers can also subsidize formal training such as conferences, online courses, or tuition reimbursement programs.
Flexible Work Arrangements
Flexible work arrangements are more popular than ever. After seeing how drastically flexible arrangements improved their lives during the pandemic, many workers still look for these opportunities. In fact, many employees leave employers that don’t offer flexible arrangements.
It’s true that not every position can be done remotely. However, remote work is not the only flexible work option that exists. Hybrid options allow employees to get work done that must be completed in-person while having the option to work from home on days where their physical presence isn’t needed.
Beyond remote and hybrid work, other options include 4-day work weeks, flexible hours/flexible scheduling, and part-time work. Flexible work arrangements help employees meet personal needs such as daycare pickup, work-life balance, and volunteering. Showing that you are dedicated to employee well-being through flexible work entices current employees and top performers to stay while attracting new employees.
Wellness Offerings
Wellness offerings focus on increasing the overall health and wellness of employees. Wellness is essential for both life satisfaction and productivity, so it’s essential employers pay attention to the wellbeing of their employees.
A large part of wellness offerings includes basic employee benefits—medical, pharmaceutical, dental, and vision insurance. However, other offerings are being adopted by effective companies dedicated to ensuring the well-being of employees. Mental health coverage plays a large role in employee health. However, there are several other benefits that play a role in overall welfare:
- Life insurance
- Parental leave
- Programs to wean off tobacco use
- Wellness challenges
- Weight management programs
- Gym memberships and discounts
- Nutritional education
- Flu shot clinics
- Financial literacy classes
- Stress reduction classes
- Volunteer opportunities or leave
While this list seems like it comes with a hefty price tag, there are many alternatives or cost-effective options available to businesses. Start by choosing one wellness idea you feel is most relevant to your employees and research options that fit into your company’s budget.
Recognition and Rewards
A 2024 Gallup report found that well-recognized employees are 45% less likely to have left their employer. Now that’s a significant impact on employee retention rate! Recognition helps employees feel that their work has meaning and is appreciated by their work environment.
There are many employee recognition programs your company can put into place to support retention efforts.
- Peer-to-Peer Recognition: This type of employee recognition allows coworkers to recognize each other’s efforts, building team relationships and creating a sense of belonging.
- Manager and Executive Recognition: This type of recognition allows managers and executives to recognize the efforts of employees. Often, manager and executive recognition is coupled with points that can be awarded for prize redemptions.
- Employee Milestone Recognitions: Recognizing employee milestones like work anniversaries, new certificates or degrees earned, promotions, knocking a project out of the park, etc. helps employees see that their contributions are seen and valued.
- Employee Appreciation Days: Employee Appreciation Day is in March each year. During this time, hold employee-relationship building activities, launch award programs, cater in lunch, bring massage chairs in, etc. Don’t be afraid to get creative!
Promote Work-Life Balance
Work-life balance. It’s a term we’ve all heard time and time again, but a solid work-life balance leads to job satisfaction, improved employee engagement, and decreased burnout. No one can give from an empty bucket.
There are a few steps you can take to foster a company-wide adoption of work-life balance.
- Define a PTO policy that provides ample rest for employees (and encourage employees to take time off)
- Offer flexible work arrangements where possible (as mentioned previously)
- Promote mental health and offer mental health programs
- Encourage employees to focus on productivity over hours worked
- Educate managers on the importance of balance within their teams
Continuously Evaluate Company Culture
Regularly assessing your company culture allows you to understand how employees perceive the workplace, identify cultural strengths and weaknesses, and uncover potential issues before they escalate.
Company culture is often seen as a stagnant reality, but the truth is, it shifts continuously. In fact, it may shift very drastically in a short period of time. That’s why keeping tabs on shifts in company culture is so important. Company culture is one of the most prevailing reasons employees leave a company, and if you don’t take actionable steps to fix problems, you’ll lose staff quickly.
One of the easiest ways to keep tabs on company culture is through company-wide surveys. Get feedback directly from your employees to pulse-check what’s going on within teams. However, if employees don’t have trust in the workplace culture, you need to clearly indicate that surveys are anonymous, and disciplinary action will not be taken for negative responses.
Keep surveys brief enough that employees can easily complete them during busy times but in-depth enough to gain actionable insights.
This list of employee retention strategies should offer a solid jumping off point for your company; the real challenge is implementing and maintaining them. If you are diligent about employing these initiatives, employee morale will skyrocket. However, if you are struggling with high turnover, our talent team can help. Contact them below to fill open positions and breeze through the hiring process.
