Study Reveals Factors That Impact Employee Retention
Know Your Areas of Weakness For Employee Retention
Employee retention is worth your investment. Experts estimate that you will spend almost 21 percent of the employees’ annual pay trying to find and install a replacement. Clearly, it’s better financially to invest in employee retention, rather than hiring someone new.
A study conducted by GlassDoor studied more than 5,000 job transitions by examining resumes, then combined the data with information about company reviews and salaries. The factors that contribute to higher employee retention might be different than you think. Take a look at a few findings from the study:
Three main factors stand out for employees that stick. Company culture, development and advancement opportunities and adequate compensation all contributed significantly to employee retention.
While the time spent in a particular job varied by the industry and specific role, there were certain trends that predicted whether a person remained at a company. For instance, in any job, an additional 10 months that a person stayed in a particular role increased the chances of them leaving for another company by one percent. Clearly, opportunities for advancement remain important.
Competitive compensation remains important, too. When employees left one company to go work for another, they received, on average, a 5.2 percent increase in salary. When it comes to awarding promotions, the survey results indicated that a new set of responsibilities and a new title aren’t enough. Your employees want to enjoy increased compensation, too.
The findings also provide some clues about how to attract candidates from other companies. If you can identify employees that have stagnated in a role for a long time and work for a company with a lackluster culture, it could be a way to encourage them to move to your organization.
Work-life balance is more about employee satisfaction than employee retention. There’s been a lot of buzz in recent years about work-life balance, supporting the idea that people aren’t as interested in competitive salary as they are in creating the work schedule that supports their life. However, this survey revealed that while work-life balance contributes to employee satisfaction, it didn’t have a significant impact on whether an employed stayed with a company or left.
Know your employees. Of course, every employee has their own unique concerns when they begin looking for a job. While you want to offer competitive pay, cultivate a vibrant culture and offer opportunities to your employees, you also need to know them as individuals.
A behavioral assessment is a great tool for better understanding your staff and how each individual is motivated. An objective measurement like this helps you get a better idea of what you can do to improve employee retention and satisfaction.
PI Consulting Group understands the factors that influence employee retention, and we can help you design a comprehensive talent management strategy that includes specific objectives for improving retention. Give us a call to talk more.