Talent Turnover Will Cost You. Here’s Three Ways To Keep Your Top Talent.
There is a good news/bad news situation happening with American jobs. This Washington Post article reports the nation added more than 220,000 jobs in June and the unemployment rate fell to a seven-year low at 5.3 percent. Job openings are at their highest level in more than a decade. Wages, however, have flatlined and America’s overall workforce size is declining.
Employment numbers and the overall health of the American worker will be a much-hyped and much-watched element of the upcoming Presidential election. But what will really matter to American businesses is retaining top talent.
A healthy job market motivates more workers, even happy ones, to look elsewhere. The Department of Labor’s Job Openings and Labor Turnover Survey shows that 58% of employees in today’s marketplace are leaving jobs voluntarily, compared to only 35% who are subject to lay-offs. This is a marked change from a four-year period (2007-2011) where these figures were nearly the same.
Hemorrhaging employees is not only a disruptive problem to your output and culture, it’s an expensive one. The (liberal
leaning) Center for American Progress reports that the average cost of replacing an employee who earns less than $50k per year is 20% of the person’s annual salary. Folks who earn less than $30k per year cost 16% to replace.
There is two types of costs associated with turnover – hard costs and soft costs. We’re going to extrapolate an explanation from Brand + People to explain the differences between hard and soft costs.
Hard costs are easily quantifiable:
• recruiting and hiring
• training and onboarding
• salary and compensation
• other lost costs associated with money spent on an employee who is hired and leaves or is fired
Soft costs are more difficult to tally:
• time spent by management trying to manage
• discipline and motivate an employee who is hired and subsequently leaves your organization
• the stress and headaches experienced by those who must manage the unsuccessful employee
• lost employee or team productivity due to conflicts or underperformance issues
• lost customer opportunities or sales due to the non-performance of the employee who is hired and subsequently leaves your organization.
For the whole blog post from Brand + People, click here. If you’re still in doubt, take a turn with this turnover template provided by the Society for Human Resource Management and the U.S. Department of Labor. Fill in the blanks and see just how much your last employee who left cost you.
U.S. companies will need to update their retention strategies if they want to stay competitive during this time, reports Entrepreneur. Here’s three tips as first reported in Entrepreneur:
Equip your teams to collaborate seamlessly from anywhere.
What is the daily experience of your typical employee when it comes to collaboration? Whether in the office or working remotely, communication delays, malfunctioning software and less-than-intuitive systems, leave employees feeling frustrated. Companies should focus on upgrading and streamlining communication processes to make collaboration fun, not frustrating.
Active Screening makes communication and collaboration within your human resources department easy, dependable and affordable with our automated and paperless background check tracking system, ACTivate Platform.
Focus on training and equipping your managers as coaches.
A common HR theory is that employees don’t quit jobs or companies, they quit managers. How does your management team compare to your competitors? Having well-trained managers will go a long way towards retaining your best employees. Focus some of your retention efforts on helping managers be the kinds of leaders that people want to work hard for. This may be a shift from managing to coaching.
Helping applicants understand the need for, and processes behind, background checking is an important part of the hiring process. Background checks are one of the most confusing and intimidating components of the hiring process but working with Active Screening helps create a transparent, seamless process that puts both Human Resources professionals and applicants at ease.
Offer work-from-home options for your current employees.
Once viewed as a perk, remote work is becoming a normal way of doing business. From an employee’s perspective, the option to work from home is a hugely desirable benefit. Data from Intuit found that 79 percent of full-time workers want to work from home at least part of the time. And in 2011, 59 percent of companies offered telework options to employees, up from 13 percent in 2006. That’s a huge increase–is your company keeping up?
How has your company helped stave off turnover? We’d love to hear from you! Send us your comments below.
This entry was posted in Applicant-Entry Solutions, Background Screening, General, Human Resources, News and tagged Applicant Experience, background checks, Background Screening, Candidate Experience, compliance, Corporate Culture, Criminal Records, Education, Hiring, HR, Human Resources, Interviewing, Jobs, Recruiting, Screening, Seasonal Hiring, small business, Staffing, Team Building, Turnover by Patricia Carlson. Bookmark the permalink.
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