Stop the Revolving Door: The Key to Keeping Good Employees
Your employees are the foundation of your company's success. Regardless of your industry, a dedicated and high-performing team is what drives growth, innovation, and achievement. But what happens when the rate of employee turnover becomes a costly cycle, disrupting your momentum?
Employee turnover can lead to increased recruitment costs, wasted time, lost productivity, and a decrease in morale across teams. For small businesses where resources are often tight, the impact can be particularly severe. That’s why improving employee retention should be a top priority.
Below, we’ll explore why employees leave, actionable strategies to attract and retain great talent, and practical steps to help your team thrive.
Understanding Why Employees Leave
Before addressing retention strategies, it's crucial to understand why employees leave in the first place. Often, dissatisfaction stems from a lack of competitive compensation, limited growth opportunities, a toxic work environment, or a poor work-life balance. Employees leave jobs for a range of reasons like these, but some of the most common include:
- Lack of career growth opportunities
- Uncompetitive salary or benefits
- Feeling undervalued or unappreciated
- Poor work-life balance or lack of flexibility
- Toxic company culture or conflicts with management
- Better opportunities elsewhere
Understanding these pain points allows you to address them head-on, ensuring your workplace becomes a destination employees want to stay at—not leave.
Prioritize Competitive Compensation and Benefits Package
A robust and comprehensive employee benefits package is a key component of attracting and retaining talent. Employees want to feel valued in tangible ways. While offering a competitive salary is important, it’s only one piece of a comprehensive employee benefits package.
Invest in Insurance
Your employees’ good health is fundamental to a small business’s daily operations because healthy staff are more likely to be happier, more productive staff. Wherever possible, provide your employees with health, dental, and vision options to prioritize employee wellbeing. There may also be tax breaks in it for you, so be sure to check with your tax professional or CPA.
Prioritize Paid Time Off (PTO)
Time away from work is essential for employee well-being and can ultimately benefit your business. Encourage employees to take time off, so they can recharge and return to work feeling refreshed and productive.
A good PTO package should include options for vacation days, sick leave, and mental health days. Trust your employees to manage their time and recognize when they need a break.
Retirement Plans
The benefits you offer employees don’t just pay the bills now, they’re also the foundation of their future savings. Recent statistics show that nearly 40% of Americans are concerned their savings won’t last, suggesting that your employees need all the help they can get. You can make it easy to save for retirement with 401(k) matches or other similar programs.
Intangible Benefits Sweeten the Deal
Some of the perks of working for a company aren’t quite as black and white. Some are expressed through softer policies in the Employee Handbook, and in the boss’s general concern for their employee’s wellbeing. It starts with the management style of the people at the top and how they treat their staff on a more human level.
- Work-life balance policies: Encourage reasonable workloads and flexible arrangements.
- Remote work flexibility: If it makes sense for your industry, allow employees to work where they perform best.
- Professional autonomy: Show trust by providing the freedom to make decisions.
Pro-tip: Research what benefits are competitive in your industry. Use tools like Glassdoor or Payscale to compare compensation benchmarks in your area. A thoughtful benefits package signals that you care about employees beyond the workplace.
Build and Maintain a Positive Company Culture
Culture is the heartbeat of any workplace. A supportive, inclusive, and thriving company culture encourages employees to connect with their work and each other.
Here are some of the key elements of a positive company culture that you can strive for as a business.
Employee Recognition
Your employees are the ones who are out there every day, serving your customers and helping your business thrive. Acknowledge the contributions of both individuals and teams to show them that you recognize their hard work and what they do for you. Ideas include hand-written notes of thanks, a shout-out at a team meeting, or something more tangible like a gift card or company merch.
Open Communication and Listening to Feedback
No matter your business size or industry, open lines of communication are crucial for a positive culture. Make sure your employees know what’s expected of them, and also be willing to listen to what they have to say. Conduct surveys or pulse checks to understand employee opinions. And if you end up implementing one of their great ideas, give them credit for it.
Collaboration
While competition can drive higher performance, it can also create a toxic work culture. Encourage collaboration rather than competition to encourage teamwork and interdependency.
Community
It’s a simple reality that people generally spend more time at their job than just about any other activity. While it’s important to maintain healthy boundaries between work and life, it’s also important to create spaces for connection. Team building activities and occasional work outings can offer opportunities for employees to get to know each other better, ultimately driving better work culture.
Pro Tip: Regularly solicit employee feedback on company culture and adjust accordingly to ensure a culture that truly resonates with your team.
Invest in Employee Growth and Development
Offering professional development opportunities is one of the best ways to signal to your employees that you’re invested in their future. When employees feel stuck or unsupported in their roles, they’re more likely to move on.
Training Programs and Workshops
Provide opportunities to learn new skills or refine existing ones. Opportunities could include workshops, webinars, bringing in a guest speaker, going to a conference, or even simply inviting one of your employees to share their skills in a slightly more formalized setting.
Mentorship Opportunities
Pair less-experienced team members with seasoned professionals for guidance. This is especially important for new employees who are trying to find their feet in unfamiliar territory. By giving them someone who can answer their questions and serve as a role model, you’ll help ensure those new hires become solid team members in no time.
Map Out Clear Career Paths
Consider cross-training employees for personal growth as well as staff versatility. For example, letting team members see a project from concept to completion provides them with holistic understanding and builds confidence.
The teams will be better equipped to hire from within and help keep projects and daily operations on task, even when the job outgrows the available workforce. With growth opportunities, employees will recognize the business as a steppingstone to success—not a dead end.
When training between positions, however, be careful not to blur job roles. Too many employees in one area can create confusion or frustration when the expected outcomes overlap without clear distinction between responsibilities. Multiple people performing the same task can result in wasted effort and money.
Master Effective Recruitment and Onboarding
Employee retention efforts start even before candidates join your team. Effective hiring practices ensure you bring on the right people, while structured onboarding processes help new hires feel welcome and prepared.
Recruitment Best Practices
Keep these best practices in mind when creating your job listing and interviewing prospective candidates:
- Clear job descriptions: Be specific about responsibilities and expectations, including any specialized skill requirements. While listing a salary range may not be mandatory in all locations, it’s a good idea to include it.
- Thorough interviews: Go beyond technical skills to assess company culture fit. How will this potential hire mesh with your current team?
- Shared values: Ensure the candidate understands and aligns with your mission and workplace dynamics.
Onboarding Tips for Team Success
Once you’ve made your decision, the work continues. The onboarding experience can set the tone for the entire lifecycle of your new hire, so set them up for success by taking a few essential steps:
- Streamline the process to make the transition into a new role seamless.
- Provide access to resources, such as welcome guides or mentorship pairings.
- Set clear expectations for the first 30, 60, and 90 days to eliminate ambiguity.
- Check in with your new hire on a regular basis and adjust as necessary to ease their transition.
Leverage Regular Employee Feedback and Evaluation
Ongoing, two-way communication is vital for employee satisfaction. Engaging in regular feedback and evaluation sessions helps employees feel recognized and valued, while also granting insight into their needs or frustrations. Accessible leaders build trust, promote transparency, and create loyalty.
Personalized Feedback Sessions
Regular conversations with your employees can give them the opportunity to share both what they like and what they struggle with at their job. This can be done in small group settings, but don’t forget to include some one-on-one opportunities for employees to share frustrations they might not be comfortable bringing up in a group.
Performance Reviews
Regularly review your employees’ job performance. This should be done formally at least annually, but don’t feel like you have to wait for a review to recognize achievements or correct a behavior. When formal review time approaches, gather input from peers, supervisors, and other team members to paint a full picture of an employee’s contributions.
While performance reviews tend to look back over an employee’s successes, don’t forget to look forward as well. Goal setting is an important aspect of any well-rounded review and gives you an opportunity to work with your employee to establish objectives that align with both employee and company growth.
Keeping Employees is a Long-Term Investment
Employees who feel valued, supported, and empowered are far more likely to stay for the long term. By prioritizing employee retention, not only will you avoid the financial strain of frequent hiring, but you’ll also foster a team of motivated professionals deeply committed to your company’s mission.
Great employees are worth the investment because they bring long-term value that fuels your company’s success.