Employee turnover is a fact of a business life. Recruiting new workers, then, is an ongoing process.
Turnover in and of itself isn’t bad because new talent brings in new ideas. New employees help companies keep pace with the competition.
But too much turnover can be a problem, especially when considering the impact excessive turnover can have on a company’s bottom line.
Some human resources experts estimate that the cost of replacing an employee can range from a low of 50 percent to 100 or even 150 percent of a worker’s annual salary. These figures are arrived at by adding together direct costs (salary and benefits) as well as indirect expenses such as the decrease in productivity that results from the need to fill the position of a departed employee.
One way to help keep turnover low is to offer incentives for longevity. These can include more weeks of paid time off, flex time, job sharing and wellness time, etc.
Many firms have success in keeping employees by helping staff members feel that they truly matter to a company’s success. Giving employees a say in a firm’s long-term goals and plan and communicating with them the advantages of staying with the company over time can go a long way to helping workers remain with a company.
Companies also are adjusting pay scales. Others are changing their hiring processes to attract employees that are looking for a long-term place to call “home”, weeding out job hoppers.
Still others look at their management-employee relations. Firms are working hard to recognize employees for their efforts and rewarding them for exceptional work or results. Simple things such as thank you notes on up to the more desirable bonus can go a long way to encouraging employee loyalty.