One of the most challenging situations in today’s market is to retain employees and locate the top notch employees for their organization. This is vital. SMEs are fighting over the market with gigantic businesses, higher salaries, for highly skilled talent.
You can retain talent not only with a high salary but benefits have an important role to reduce the employee’s turnover ratio. When you offer a position, the benefits can be also personalized and will help you to counterattack attrition, the more personalized the better when it comes to retaining talent.
This post illustrates why you should retain your employees and the impact that the turnover generates inside your organization. Plus some strategies to retain your employees.
Why should you retain your employees?
There’s a trend of employees voluntarily leaving their jobs in 2021, said the Bureau of Labor Statistics. This event has taken the name of The Great Resignation. This can be easily evidenced in the manufacturing, business services, and retail industries.
When voluntary resignation shows up in your business, it can have a negative impact on it in many ways. You might want to know why do workers voluntarily leave your company? this article will help you understand (link to why do workers voluntarily leave)
Attrition can demotivate your teams
At first glance you’ll find out that a person leaving your organization can hurt your team’s motivation. When a person leaves the people that stay in the organization might lose a friend and this might impact harder than it’s perceived.
Office Vibe said that 70% of workers believe it is vital to have a friend at work to ensure a healthy work life. Furthermore, 50% of workers with a best friend at their jobs reported that they have a stronger sense of bonding with their workplace. In conclusion, if someone leaves the organization the engagement of the people who stay is vastly hurt.
Workers’ Attrition Slows Production
A leaving person slows down production in teamwork, this is easily evidenced due to the fact that your team becomes smaller and the amount of work is still the same. The remaining workers tend to feel overwhelmed, and become exhausted faster so they won’t do their job as well if they were fresh.
According to HubSpot, the productivity loss in U.S. businesses is around $1.8 trillion dollars every year. This, of course, will hurt your organization financially.
Attrition costs a lot of money
Probably one of the most hurtful situations caused by turnover is the money expenses coming from recruiting and onboarding new employees to replace the ones who have left. This cost might be variable but it is clear that businesses need to take care of this.
Hereunder you’ll find some of the variables that you’ll need to take into account to calculate how much it costs your organization to replace one worker.
Reports have illustrated that it costs in between 50% and 75% of someone’s yearly income to replace it. It depends on the role and wage you’re trying to replace.
Down below there is some examples of these costs:
- Hourly employees: $1500
- Tech positions: 100% – 150% of an employee’s salary
- C-suite positions: 213% of the employee’s salary