High retention rates are always important. However, with today’s skill gap and worker shortage, it’s more critical than ever. Not only does it have a direct and immediate impact on your team overall, but on the long-term health and success of your company. Without solid retention rates, you’ll be left scrambling to hire and possibly making a mistake that could cost you.
So how can you tell what your retention rate is? There’s a simple formula where you just divide your total number of remaining employees for a certain period by the total number of employees you started with, then multiply it by 100.
For instance, you can use the first business quarter as the time period. If you started it with 54 employees and ended it with 48, then your retention rate is: 89%. In other words 48 / 54 = 0.888 x 100 = 88.8. Rounded up, that’s 89%. Generally, you want a retention rate of around 90% or above. If yours is lower than that – especially much lower – what can you do? Here are some strategies for improving it:
How Can You Improve Employee Retention?
Focus on hiring efforts.
Good retention starts during the hiring process. If you’re not hiring the right people, they’re not going to stay with your company for long. It’s why investing in your hiring process and working to ensure it’s effective is critical.
Boost your business culture.
If there’s a lot of gossip and backstabbing at your company, then the culture is likely the culprit when it comes to high turnover. Work to alleviate this by providing adequate training, offering team building, and communicating effectively with your employees. Also, make sure you’re recognizing and rewarding your people at work.
Create advancement opportunities.
If an employee wants new challenges, yet there isn’t an opportunity to get promoted, they’ll move on to greener pastures. It’s why providing training and development, along with adopting an internal promotion policy makes sense. This will send the message that if your employees work hard, they can move up and advance at your company, improving retention.
Understand what’s important to your people.
Some employees want bonuses, others are looking for a better work-life balance through scheduling flexibility. Whatever the case, find out what’s important to each employee. It will be different for everyone. Then work to provide the perks and benefits they want. This shows you care about their well-being and satisfaction, so they’re likely to stay with your company for longer.
Make sure compensation is competitive.
With high inflation, workers need to earn more to keep up with costs. Now’s the time to be evaluating your compensation and boosting it wherever you can. Go beyond the typical 3% annual raise and try to offer more, especially for high-performing employees. You can also consider adding to their benefits plans by providing extra perks, like gym memberships or access to corporate deals.
Need more help retaining top employees?
It starts with hiring and OneSource Staffing Solutions can help. As a leading staffing agency in PA, NY, and FL, we fill a wide range of positions, at all levels, with skilled and dependable individuals. Contact us today to learn more about how we can be an asset to your team.