Employees are the most valuable assets for any business, and retaining them is vital for a company to succeed in a competitive talent market.
In the United States alone, over 40 million people quit their job in 2020. This number has been increasing each year, which means the average retention rate is decreasing with time. This results in companies spending an increasing amount of money hiring new talent to replace the employees that are leaving. The cause of this is because in a tight talent market, high caliber employees have a wealth of options, and no longer have to stay in positions that are not fulfilling their needs, because they are being consistently recruited for different roles.
The financial cost of employee turnover is not the only thing that impacts a business that suffers from high attrition rates. A company that is unable to retain its top talent also suffers from lost productivity, uncovered regions which risks losing market share, spreading existing employees too thin when covering open positions, which perpetuate the problems of turnover. This all can create a negative image which results in increased difficulty in attracting top talent.
Here are 5 key strategies to help you increase retention rates:
Understand That Retention Begins With Recruiting
The retention rate of a company starts with the recruitment process. From the application to the screening to choosing which candidates for interviewing, it is important for the company to identify the key skill sets and experience that a role requires, combined with their organizational culture when evaluating candidates. In order to have a long term match, it is essential for an employee to not only have the expertise that a position requires, but they must also fit into your unique culture.
READ MORE: The Importance of Cultural Fit When Hiring
When recruiting top talent that are not actively looking, it is extremely important to address that in your interview process. Recruiters refer to these types of candidates as ‘passive’ candidates. They are typically currently employed and doing well, and the recruiter has learned about the types of roles they would be open to hearing about. These types of candidates are extremely valuable and need to be treated differently than someone who is currently unemployed and hungry for a job.
When interviewing passive candidates, rather than having HR or hiring managers sitting back wanting to be ‘sold’, the focus should be on learning about the candidates prime motivators that would entice them to make a move, which a good recruiter will share with the hiring manager as part of their formal presentation. During the interview those points can be addressed and ideally reflected in how the opportunity is a good match to their long term goals.
Be flexible in not mandating passive candidate’s complete application forms prior to the first interview, and be cognizant of their time. Over the years we have lost many strong candidates because they were left waiting in the lobby for long periods of time because the interviewer was running late, or they were otherwise turned off because the hiring manager had clearly not prepared for the meeting by reviewing their resume.
In the war for top talent, all of these things add up, so make sure you take everything in account when you have an exceptional candidate ‘on the line’.
Identify And Avoid Job-Hoppers
Another easy way to increase high retention rates is to hire candidates who are more likely to stay on the job. As they say, the best indicator of future behavior is past behavior, so steer clear of job hoppers.
There are certain factors that indicate that the potential candidate is a job-hopper, such as consistently switching from job to job, not staying with one company for more than a year, and a resume full of lateral job titles. Save yourself a lot of trouble and make a practice to consistently avoid these types of candidates.
A recent study showed that a whopping 89% of doctors are proficient at playing a musical instrument. This shows the person is committed to putting in the time to learn a skill. Other hints of a person’s ability to stay on task is to see if they have achieved a black belt in karate, or perhaps attained the rank of Eagle Scout.
Utilize Behavior Testing Tools
We always encourage clients to take advantage of some of the amazing behavioral testing tools available these days. There are quite a few good ones out there, and taking advantage of these tools to evaluate how a person will perform within your business model makes a lot of sense.
With the current challenges of Covid, testing for someone’s ability to work independently can save companies a lot of time and effort in screening out applicants that require a lot of direct supervision. You can also screen for the ability to be flexible in today’s rapidly changing work environment.
Assign a Mentor
Study after study shows that when a new employee has someone within the company that is not a direct supervisor that they are comfortable going to for advice dramatically increases their retention rates. Make a point during your on-boarding process to assign someone to reach out on a regular basis, especially during the critical first 90 days of employment, which is when the vast majority of new hires jump ship.
Have management offer to pay for lunch and let the mentor take your new hire out to lunch once a week for the first month & then scale it back to every 2 or 3 weeks, and you will gain that investment back tenfold.
Provide Opportunities For Growth And Advancement
One of the most common reasons cited by employees for quitting their jobs is the perceived or real lack of growth and career development. Providing opportunities for growth and advancement to employees and promoting from within offers the employees a better path to greater compensation and responsibility in the company and helps them feel valued and a vital part of the company’s success. Employees who feel that the company offers no room for growth and they are at a dead-end job are much more likely to quit and look for better job prospects.
When you do promote someone within your organization, sing their praises from the rooftops. It is such a waste of a golden opportunity when a company promotes someone, but people in the lower ranks are not aware of that.
Be sure to have regularly scheduled review sessions where you can go over your employee’s performance reviews, learn about their long range goals and then outline specifically how they can achieve those objectives.
Find High Caliber Candidates for your Company With ISC!
International Search Consultants has been a leading executive recruiting firm in the United States since 1999. Our team of 15 experienced recruiters includes experts in recruiting for exceptional talent within a wide range of positions, from HR to Ops, Sales to Finance.
Get in touch with us today to find out more about our comprehensive executive recruitment services.