One of the biggest concerns for CEO’s around the world is retaining their top talent, and unsurprisingly so - staff turnover rates have been on the rise over the last decade.
Read on for the picture in numbers and ideas on how to keep ahold of your greatest asset - talented staff members - in a competitive market.
What happened to employee retention in the last years
The uncertainty of 2020 impacted employee retention in both predictable and unexpected ways. The voluntary attrition rate fell for the first time in years and then rose back to levels seen in 2019.
Layoffs peaked at 11.5 million in March 2020 and stabilized later in the year. But, when it came to voluntary employee departures, around two-thirds were preventable.
The loss of skills, customer relationships, and knocks to employee morale of high employee turnover can give rise to great direct and indirect costs. To isolate one - the average direct cost of attracting, hiring, and training new staff is $4,129 per hire and takes around 42 days.
2023 Talent Attraction and Retention Statistics
Keeping ahead of the latest trends in workforce behavior enables you to roll out the necessary talent attraction and retention strategies.
So, what are the latest trends in employee retention?
1. 25% of full-time employees plan to look for a new job with a different employer after the pandemic
Lack of opportunities to grow and learn play a big part - employees that feel their company offers positive learning opportunities are 21% less likely to have left their organization for a new role in the last 3 years.
Nearly 60% of workers embarked upon their own skills training last year, highlighting an unmet appetite in the workforce for greater knowledge.
This was particularly true among Gen Z. This generation also showed a preference for upskilling themselves via the medium of video specifically, watching 50% more of learning material in 2020 than in 2019.
Gen Z or otherwise, the general trend indicates that employee retention rate is increasingly linked to employers’ approach to employee learning and development (L&D) programs.
2. People are 23% less likely to leave their jobs over pay
Pay issues have never been the number one reason employees leave their jobs, but this reason for leaving dropped even further during the pandemic and stood at 23% less than in 2018.
While this may be heartening for employers in some respects, it’s important to understand why employees are leaving.
According to the Work Institute’s 2021 Retention Report, the number one reason for employees’ premature departure was ‘career issues’ with their current employer, which meant a lack of opportunities for growth - 1 in 5 employees left for this reason. The second top two reasons for departure, following career issues, were:
Health and family issues (physical, emotional and family-related health issues)
Work-life balance (scheduling, travel, and remote work preferences)
3. Lonely employees are 2 times more likely to quit
When your workforce is deskless and untied from a traditional setting like an office, it’s easy for feelings of loneliness to creep in. A lack of feeling of belonging negatively impacts employee performance - lonely employees produce lower quality work and are twice as likely to consider quitting.
Making learning a collective endeavor is a way to counter this, build connections and a sense of belonging in a remote context. This in turn positively influences things like employee motivation, productivity and retention.
But how do you successfully execute group learning when people are in different places, or working at different times?
Peer-to-peer learning doesn’t need to suffer merely because you have a ‘liquid workforce’. Group learning can be easily replicated digitally via. E.g. if a worker has a high customer service rating, or has consistently exceeded sales targets, ask them to create a short video sharing their top tips for success with the team or company.
Pursuing such an initiative also has the knock-on effect of raising workforce-wide motivation - when employees see their peers recognized by being asked to share their expertise publicly, they are more likely to want the same for themselves, driving improved performance.
4. Companies investing in Diversity and Inclusion (DE&I) are 8 times stronger in employee retention
Greater retention is increasingly converging with employers’ commitment to diversity. Various studies show companies with Diversity & Inclusion (D&I) practices are up to 8 times stronger on innovation, customer service, and employee retention.
Investing in diversity improves retention within an organization, and also external perception of an organization - businesses are 22% more likely to be seen as industry leaders with high-caliber talent. This strengthens the employer brand further, so attracting talent in the first instance becomes easier too.
Whether improving diversity in the workplace through a dedicated Diversity and Inclusion team or raising the profile and understanding of issues around diversity through the Learning and Development team, addressing this pertinent issue has been shown to be a key factor in a company’s success.
5. 41% of employees strongly agree knowing what their company stands for differentiates it from competition
Aligning employees with vision and mission so as to instil a sense of purpose is not a novel idea. Gallup has identified culture as important for attracting and retaining talent for years, what is surprising is the way remote work has improved many companies’ cultures.
Somewhat counter-intuitively, the increase in remote working over the past 12 months or more has resulted in a greater connection with company culture for nearly half of American workers. This is likely because businesses have been making double the effort to ensure their people feel connected and motivated via shared vision and values.
The past year, and the latest statistics for employee retention, reinforce that financial compensation is far less important in terms of retaining talent than commonly thought.
Employees in fact take a holistic view of what their jobs offer when weighing up whether to leave or stay. When considering how to improve employee retention, workplace conditions, level of connection to the company, and the opportunities to learn and grow should be key considerations.
Ultimately it’s employers that never settle for the current status quo, continually improving things like ways of learning, technologies used and employee diversity and wellbeing programs, that will be seen as pioneering (and the envy of competitor companies).
eduMe provides modern companies with the opportunity to connect their deskless workforce and improve retention through learning delivered on-demand to whoever needs it, wherever they are.