What You Need to Know to Manage Your Employee Turnover Rate

Employee turnover is costly regardless of the industry. Companies with high turnover must tackle the direct costs of constantly recruiting, selecting, and training replacements. Indirect costs can also be involved when a company has high turnover. These can include a reduction in morale, declining productivity, a lack of customer satisfaction, and less innovation. At a manufacturing company, the loss of one trade worker cost them $53,000 in direct costs. These costs included overtime for employees who had to fill in for the missing staff member, the cost of recruiting a replacement, as well as training the new staff member; all of which do not include the salary and benefits of the new employee. Losing employees can mean even more money for you if there are issues with severance pay or executive compensation disputes, both instances where you might need to hire a lawyer. Managing employee turnover is critical to any company’s success, so taking care of employee needs now can save you a lot down the road.

Explain Ebbs and Flows When Hiring
Every industry has peak busy seasons as well as slow ones, but very few employers explain those periods during the interview process. A hiring officer may expect an interviewee to understand their accounting office is swamped between January and April, but not every new accounting graduate will truly understand until they’ve worked in the industry a while. If there are times your company is significantly busier than others, even if it’s on a weekly basis, explain the process to a potential new hire during the interview process. If you may expect them to work late nights or on weekends a few weeks out of the year, or if your company has weekly deadlines that may mean a late night or two each week, be sure that the person you are considering for your company is well aware of time issues. This way you can avoid sticky schedules down the road and turnover rates when new hires can’t keep up.

Offer Schedule Flexibility
According to a recent survey, 65 percent of employees say they left a position because the company does not offer schedule flexibility, while 67 percent say they found another job because they felt that they would be penalized for using a flexible schedule if it was offered. Today’s workforce has more outside pressure than any other generation. Managing children usually fell to women in the past, but it isn’t the case any longer. Many men and even grandparents are now coaching sports teams, handling doctor’s appointments, and are more involved in the day-to-day raising of children than their fathers and grandfathers were. This means everyone needs the flexibility of scheduling, including telecommuting, in order to achieve a good work-family balance. By offering telecommuting, compressed schedules or on-site daycare, you may see a significant reduction in turnover.

Recognition and Praise
Too often, employers overlook how important recognition and praise are to employees. A recent Gallup poll found that employees who receive regular recognition and praise showed increased productivity, increased engagement, are more likely to remain in an organization, provide better customer service, and have a better safety record than those who do not. In fact, the U.S. Department of Labor found the number one reason people leave a job is when they feel unappreciated by their employer. Recognizing employees who are doing a good job can go a long way toward a happy, healthy workplace. Although awards and certificates are appreciated, even a simple email praising someone for the work they do, or a monthly newsletter highlighting the accomplishments of several staff members can help boost morale and encourage employees to reach even greater heights. Keeping employees depends greatly on your treatment of them both in praise and pay.

These tips can help your company reduce turnover and improve company morale. As a business you can’t afford to be constantly posting job opening and going thought the hiring process. It’s your responsibility to keep the employees you have now. By reducing turnover, you can improve the business’ bottom line and see better customer satisfaction overall.