By: Seo Mavens 

The success of an organization depends on its ability to draw in as well as stop losing employees. If businesses want to prosper in the current economic climate, they must make investments in recruiting and retention initiatives seriously.

However, small businesses and non-profit organizations have an even harder time hiring the right workers since they have to compete with more prominent companies and budgets for the best staff.

This article will discuss the importance of staff turnover, the cost of losing an employee, and preventative measures you may take.

Figuring out how much staff turnover costs

Let’s first take a look at the factors that contribute to the true cost of replacing an employee for the majority of businesses today before discussing strategies to lower staff turnover at your organization in the next months and years.

According to Carl Rodriguez, owner of NX Auto Transport: “Unfortunately, most firms lack the proper systems required to collect key indicators across several departments, such as operations, finance, and HR, making it impossible to determine the true cost of turnover.

Nevertheless, there are a few concrete figures you should be aware of:

Costs associated with recruiting, according to recent SHRM data, the average cost of employing a new full-time employee is $4,700.”

Temporary workers and overtime: To cover the void created by retiring personnel, you may need to set aside more money for employing temporary staff or paying overtime.

Training costs: In order to learn their jobs, new hires often need to undergo specialized training. According to TrainingMag data, the average cost per student is $986. Don’t overlook, however, unforeseen expenses such as supplies delivery to workers who work remotely.

Time to full productivity: Using the average ramp-up time as a foundation, this computation is relatively straightforward. If it takes a new hire three months on average to be onboarded entirely, it works out to a cost of 25% of their yearly salary after six months, 50% after six months, and so on.

You may compute this cost for each job or role in your organization or get the average cost for budgetary reasons.

In any case, you’ll probably be surprised by the figure. It should, nonetheless, additionally provide a substantial incentive to guarantee that valuable staff members want to work for your organization in the long run.

 To put it another way? Working with your HR and talent teams as well as people managers to create a strategy will be highly motivating if you have a better understanding of the true cost of losing workers, whether they are hourly, contract, or full-time employees.

Ways To Avoid Losing An Employee:

The costs associated with employee turnover can be substantial. Thus, we have compiled a list of approaches your company can take to avoid losing employees and ensure that your business operations remain undisrupted.

Provide high-quality health benefits

Indie Basi, owner of Wade, says: “One of the best ways to increase employee retention is to provide health benefits as this is one of the most sought-after employee perks. But not every health benefit is made equal.

Although traditional group health insurance is a great choice for many businesses, many small and midsize businesses are finding it to be unaffordable due to escalating healthcare expenses.

Employees are also compelled to join networks that may not suit their specific requirements.

 Organizations like health reimbursement arrangements (HRAs) because of their affordability and flexibility. With an HRA, you may pay back your workers’ qualified medical expenses—such as out-of-pocket costs and individual health insurance premiums—tax-free.”

Selecting candidates that fit the culture

Amanda Dixon, owner of Merge, recommends ensuring you’ve hired the right candidate to avoid problems later on.

She says: “The company’s culture must be communicated to candidates up front by recruiters, who should inform them how the business runs rather than just what they believe the prospect wants to hear.

However, ensuring that recruitment is searching for the correct candidate from the start is crucial to hiring the right candidate.

According to Jobvite research, less than half of employees think that job titles accurately represent duties, and over a third have quit a job within the first 90 days because it didn’t live up to their expectations

 Having colleagues in that position make recruiting choices is one method that many companies have used to increase their success rate with new workers.

Employers should take the opportunity to familiarize themselves with the applicant via any accessible channels.”

Reward and honor staff members

Harrison Tang, owner of Spokeo, tells us: “It’s pretty simple to use this technique to avoid losing an employee. Saying “thank you” and writing messages of gratitude for the hard work that workers do every day may make a big difference.

Offering new possibilities to employees is another excellent method of showing them appreciation.

 Here, the management of an employee has a significant influence. Employees who feel positively about their manager’s input are far more likely to be engaged, and very few of them are actively seeking other employment.”

Other Benefits

Your workers place a high value on benefits. What kind of health insurance do you provide? Each pay month, what percentage of the premium are you covering? What kind of parental leave policy does your business have? Do you own a 401(k)?

These are important questions. Let’s say you are not providing competitive advantages in a timely manner. If that’s the case, you can have staff turnover as they leave for more significant opportunities.

Find out from your staff what extra advantages they would like to see offered. To choose which benefit plan is ideal for your workers, consult with your insurance agent and human resources staff.

Compensation

Salary is an important retention tool, even though it’s not everything. Paying your staff what they are worth should be a regular process that involves evaluations.

You will lose employees if you pay less than a rival firm. Pay raises that are regular and frequent enough won’t be enough to keep your present staff on board. Nevertheless, they will feel more motivated and inspired to work harder as a result.

Any firm that wants to reduce employee turnover should provide its workers with competitive remuneration and the opportunity to earn more to avoid losing valuable employees.

Published by: Khy Talara