The recruitment and hiring process is an expensive and time-consuming one. Between advertising, reviewing resumes, and conducting interviews, drug screens, and other pre-employment processes, direct and indirect costs mount quickly, and they are just the starting point. When you factor in the cost of training, of salary and benefits, and of what Annie Mueller at Investopedia refers to as workplace integration, hiring a new employee can cost anywhere between 1.5 and 3 times the amount of their salary. With an investment like this, companies should make sure to have proven hiring assessments in place to ensure they always hire the best candidates, but should also consider the ROI of making sure they have a robust retention plan to keep those high-quality employees from moving on to greener pastures.
According to a March 2015 LinkedIn survey, the number one reason people chose to leave their job was concern about the lack of opportunities for advancement, and the number four reason was the need for more challenging work. This is critical information for human resource professionals, who need to take a look at their processes for internal advancement. Does the company prioritize looking at its internal talent pool before looking outside the company? Are employees encouraged to seek out opportunities, and not penalized by their current supervisors or managers for expressing interest in available openings? Does part of a manager’s deliverables include finding and grooming current employees for advancement? Fostering an environment where employee development is a priority could keep that key player in your corner.
Management, of course, is still a major reason people choose to move on. There will always be employees who conflict with their managers and supervisors; this is inevitable. However, there is no excuse for allowing bullying or threatening behavior by leadership. Problem managers are easily spotted, and when they are causing employees to leave the company, they are a liability. Proper training, strong expectations, and quick problem resolution are vital to ensuring your management team is not creating retention issues.
And of course, there is always money—or close substitutes. Salary is not the only thing that helps retain the best talent, although it is an important factor. Competitive benefits are also important, and today that means more than health insurance and a 401k. Flextime and telecommuting are popular options when feasible, and help demonstrate the company is prioritizing an employee’s work/life balance. The popular website www.glassdoor.com can help you discover what other companies in your industry are offering so you can make sure you are keeping up. Other ‘money substitutes’ include perks like offering free coffee or snacks, paid parking or bus passes, or monthly company lunches. Some of these perks can also promote a more cohesive team, if they allow employees time to get to know one another on a personal level.
Finally, in much the same way as you conduct exit interviews with employees who are leaving, don’t hesitate to talk to your long-term employees and find out why they’re staying. What keeps them motivated? Talking to your employees is a good idea no matter what objective you are trying to achieve, but in this case, they are the source. Use their expertise and suggestions to help guide you in which programs to strengthen, and to determine what areas you need to focus on as you work to hire, train, and retain the best employees.