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7 Ways To Reduce Employee Turnover in 2021

Updated: Dec 4, 2023

The workforce has experienced a significant change during the pandemic. Many businesses are stating that the workforce will not go back to normal. Some companies have decided to become permanently remote or hybrid post-Covid.

Will remote work affect employee turnover, or will it increase retention? The Human Capital Institute states that employee engagement focuses on three factors: growth, recognition, and trust. All three facts are achievable remotely through creative and innovative approaches.

As we move forward to a new work style, we will also see a new type of management. With remote work, leaders and managers cannot fully supervise their employees. Leaders should trust their team, focus their efforts on business needs and innovative tasks, and strive to manage less. The kind of leadership that the new era needs are compassionate and trusting individuals. These are leaders who will retain employees by making them feel seen and respected. The seven strategies to reduce the turnover rate of employees in your workplace consist of hiring the right people, improving work culture, increasing employee engagement, promoting work-life balance, investing in training, attractive benefits package, and leading by example.


Hire The Right People

Hiring is a lot more strategic than many would assume. The process is long and expensive. According to SHRM, the average time it takes to hire a new employee is 36 days. Many employers are usually in a rush to hire their next employee. They do not have time to fall behind on work and quotas. However, using the time and money to hire the wrong person is more detrimental and expensive than hiring correctly. Keep in mind that the higher the turnover rate is, the greater is the risk of wasting your company's resources. When hiring, focus on knowledge, skills, ability, and GRIT. Grit stands for guts, resilience, initiative, and tenacity. Not all individuals will have all the job requirements, yet their GRIT will drive them in the workplace. Grit is the differentiating factor from an employee who simply performs their tasks compared to the employee who asks for more responsibility.


Improve Work Culture

In a positive working culture, the turnover rate can be at its minimum. Create a work culture that encourages employees to move on from the company for their professional development, yet they still choose to stay. Work cultures should be fun, exciting, and motivating. No individual would want to work for a company that is dull and boring. Forbes estimates that 43% to 53% of your workforce is currently bored. The first thing to do while changing the culture is to increase communication, especially between remote workers. 54% of employees say a strong sense of community keeps them at their current company. Have an open forum for a social hour once a week. Allow employees to make connections and build relationships with other departments. You can still have a thriving work culture while being remote. Just as the shift happened at the beginning of 2020, there must be a shift in the workplace in 2021. Implement new strategies and innovative perspectives to create that fun and exciting work environment.


Increase Employee Engagement

Employee engagement is the number one telltale sign to determine if an employee is unhappy and can predict the increase of employee turnover. Although not all employees will stay for a long duration, there are a few things the company can do to ensure retention. Usually, employees lose engagement within 6-12 months at a company. Employee disengagement costs more than $500 billion per year to the US economy. During this disengagement period, the employee has mastered the role and is not learning anything new. A great way to combat this is to allow employees to switch roles with similar skills. This way, employees see how other departments within the company function and learn something new along the way, keeping them excited and gaining the in-depth knowledge. Another great way to keep employees engaged is to work with them on their professional development journey. Ask them what their career goals are and develop a plan to reach those goals within the company. Promoting from within not only encourages employees but also saves the organization money on hiring costs.


Promote Work/Life Balance

Another way of avoiding employee turnover is to show them that you care about their time as well. Employees who feel understood by their employers about having life responsibilities are happier and loyal in the long run. If employees need a day or two during the week to care for family, they are most likely willing to work on the weekends with no hesitation. Flexibility is a great way to promote this. If feasible, allow employees to determine when they begin work and when they end. Set core business hours when you expect all employees to be working and give them flexibility when you can. For example, you can say that all employees should be working from 11 am to 3 pm. Promoting a healthy work-life balance allows employees greater autonomy over their day. They will be grateful—employees who feel cared for in the workplace work harder and provide more outstanding results.


Invest In Training

This strategy is a win-win for both employees and the organization. Monthly or quarterly training sessions will allow employees to become more skilled and knowledgeable in the workplace while increasing productivity and efficiency. It will also allow employees who would like to transition into a new field to begin learning new skills. Training will enable employees to complete more tasks on their own. As well, trained employees can perform with less supervision. This method decreases micromanaging and saves time to focus on individual tasks. Employees also feel more confident in themselves and their value at work. Trained employees feel more invested at work. They like to progress and become knowledgeable in business operations and support the business even more.


Attractive Benefits Package

Create a well-rounded and unique benefits package that is tailored to the needs and wants of your employees. Healthcare benefits are a standard and should always be present. To add more value to your benefits package, you can include a section for company perks. Small to medium-sized companies can still create excellent benefits and perks without necessarily spending a large portion. For example, giving employees a paid day off for their birthdays is unique and makes them feel special. You can also offer work from home every other Friday. Benefits do not always have to cost money. As long as they provide convenience and enjoyment for employees, that is what matters most.


Leaders Set The Example

Business owners and top management heavily influence the organizational culture, productivity, and behavior of all employees. The way leaders handle situations affects everything. For example, when leaders are not supporting or encouraging their employees, employees feel unappreciated in their environment. They will dread coming to work and start looking for employment elsewhere. On the other hand, if managers show trust, compassion, and encouragement, then employees will feel empowered and continue to produce better results. They will enjoy work and look forward to learning from their leaders. Employees leave or stay as a result of their leader’s actions and treatment of others. The new generation of leaders must have empathetic, positive, confident, transparent, and motivating qualities.


Follow these seven steps, and you will be on your way to making your employees happy and increasing retention in your organization. If you are a small or medium-sized business, HR Lab Los Angeles is an excellent outsourcing resource. You will gain a team of three certified professionals for the price of hiring one. Take a look at our pricing page or reach out to us for more information. You can also read more of our blogs for a variety of content.

If you need more advice, we invite you to look at seven additional blogs on our website to promote happy company culture.

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About HR Lab: Formed in 2020, in the midst of the pandemic, HR Lab is here to make a difference. At HR Lab, we work to strengthen workforce quality by improving the HR system, ensuring its ongoing relevance, and preparing employers, workers, educators, and governments to use it effectively. Our vision is a labor market that relies on the relevance, quality, and value of workforce credentials for opportunities, growth, and development.

Disclaimer: The information in these materials should not be considered legal, accounting, or investment advice, and it should not substitute for legal, accounting, investment, and other professional advice where the facts and circumstances warrant. It is provided for informational purposes only. If you require legal, accounting, or investment advice, or need other professional assistance, you should always consult your attorney, accountant, or other professional advisor to discuss your particular facts, circumstances, business, personal finance, and investment needs.

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