Why Your Employee Retention Rates Are Low (And How to Fix It)

In Staffing Solutions by adminburnetts

staffing your team

staffing your team

Although many business owners may feel jaded about young workers, the reality is that employees who are part of the millennial or Gen Z generations may actually be more willing to “make it work” than you might think. But unfortunately, when staff members of any age don’t feel valued or safe in their work environment, they’ll have no problem moving onto the next opportunity.

These young workers might be seen as job hoppers, but it doesn’t have to be that way. If your business is suffering from low retention rates, you may feel it’s more convenient to blame it on the age or inexperience of employees. But by refusing to start staffing your team with these individuals, you might be missing out on a huge opportunity to grow your business. Instead, it may be time to look at the underlying causes of low retention rates — and what you can do to turn things around.

Common Reasons For Low Retention Rates

  • Lack of Benefits or Poor Compensation: The reality is that most people are not going to stay with an employer who does not pay them what they’re worth. While it’s common for young people — even those with full-time employment — to embrace a side hustle (or several), that’s not a valid excuse to pay below a living wage. Fair payment should be a priority for business owners; if you can’t afford to pay your employees the industry standard (or above it), you probably can’t afford to be in business. Wages actually aren’t the top driver of low retention rates, though. A lack of health insurance benefits, vacation days, and other perks could very well be why an employee might leave for a better opportunity. In fact, many are willing to take a lower salary if they receive health insurance coverage or more paid vacation days in return. By failing to take care of your employees, you might be shooting yourself in the foot.
  • Bad Hiring or Training Practices: It might surprise you to learn that 22% of new hires leave their jobs within 45 days of being hired. When it comes to staffing your business, it (literally) pays to take your time. If you’re in a rush to start staffing your team and you end up hiring people who are a poor fit for the position or for the company culture, you’ll end up spending a staggering amount related to turnover. And by failing to train employees properly, work satisfaction and productivity will certainly suffer. If a new employee feels stressed or frustrated during the training process — or they receive very little instruction at all — you’ll have a tough time making that person feel welcome and engaged. At that point, they’ll probably have very little emotional investment, meaning that they won’t have much of a reason to stay.

How to Turn Low Retention Rates Around

  • Value and Nurture Employees: Benefits and higher wages are necessary in terms of keeping good employees around. If a worker feels they’re being paid less than they’re worth, they’ll feel you don’t really value their contributions to the company. But if you show your appreciation with both compensation and verbal recognition, you’ll ensure that employees are happy and invested in what they do. What’s more, providing perks like additional vacation days and flexible work hours can encourage a better work/life balance. This can translate to reduced stress, increased productivity, and long-term employment.
  • Improve Hiring Methods: Staffing your company with the right people from the start can go a long way in improving employee retention. That might mean taking more time with your interviews or working with staffing services to find the best candidates for the position in question. While you’re overhauling the policies you have in place for staffing your team, you should also take a closer look at your onboarding practices. By investing time in hiring and training, your employees will feel just as invested in the company.

Want to improve your retention rates? We can assist you with staffing your team. For more information, please contact us today.