Do you understand the impact that turnover has on your company, in terms of lost business and productivity? Hiring talented employees is just the first step to maintaining a quality staff, and many companies don’t understand the negative impacts that employee turnover can have on the bottom line. Too often, businesses fall into the trap of being too focused on their hiring methods, and they don’t realize that employee retention can be more important than hiring.
It has been said that employee turnover can cost 1.5 times their annual salary, because of the time and resources that it takes to hire and train a new employee. Once you have hired the right candidate, keeping them satisfied with their job is one of the best ways to reduce turnover and improve your bottom line. It’s a win-win situation: the employee is satisfied so they work harder to excel in their position, and the company maintains good talent which can help to improve the bottom line.
2014 Hiring Trends Show That You Will Lose Quality Employees
Predictions for 2014 show that recruiting will become more and more competitive as companies are working to secure top talent for their team. Highly skilled employees aren’t necessarily looking for work, because they are already gainfully employed… which means that recruiters will be looking to pull the talent from other companies. If you don’t want to lose your top employees to other companies vying for their attention, then it is critical that you focus on job satisfaction to make your employees less likely to consider other job opportunities that become available.
Employee Retention Starts With the Hiring Process
The truth is that hiring and employee retention are closely related. Many companies view their hiring department and the employee relations department as two separate entities, but these two departments should be working closely together.
Employee retention starts during the hiring process, by using an applicant tracking system to identify which candidates have the right skill set for the job and show good potential for long-term employment. As soon as the candidate is hired, the employee onboarding process sets the tone for the rest of their employment. Ongoing development and career progression is necessary to help the employee feel satisfied with their job, and to help them feel loyalty to the company. Employees are more likely to stay with a company if they can see potential for career development and job progression, so it is important to make sure that they aren’t stalling out in their current position.
Managing Performance to Help the Employee Grow
Because career development is essential for employee satisfaction, it is important that you have a performance management system in place to monitor progress during the year. Progress that is not tracked can be very difficult to measure, and a performance management program can be the key to help each employee progress and grow from one year to the next.