Lower Hiring Costs By Increasing Retention
Too many companies are not responding quickly enough to the expectations and needs of the workforce today. Turnover is costly so it’s time to focus on retention. In the continual rush to be productive we often fail to treat people well. Happy employees stay with companies longer. They’re less likely to be vulnerable to recruiting calls.
One obvious trend is employees are taking control of their careers and their life. Companies are not trusted to provide career longevity. Corporations hire and layoff unpredictably. Job security is a myth so employees have learned to style their lives differently. The truth is more employees are willing to walk away from employment scenarios that make them miserable.
On average it costs between $15,000 and $45,000 to replace a worker who earns between $40,000 and $110,000. While the figures may vary from industry to industry, for example the estimated cost to hire a nurse is around $60,000, the fact is companies can save a bundle of money if they have less attrition.
There are several things employers can do to improve retention and lower hiring costs.
1. Training. Give employees more skills. Employees want to increase their value.
2. Provide communication training. Encourage and expect constructive feedback to flow up, down, and sideways. Provide avenues for feedback. Surveys show the number one reason people are unhappy at work is due to an ongoing issue with someone who matters at work. Increased stress can certainly lead to turnover.
3. Mentoring programs. Help employees see the long view and career path options. How do they get to where they want to go?
4. Flexible schedules. Focus on what is expected of an employee. Be clear about what, when, and how they are to accomplish their goals. Define clear parameters. Younger people want a work/life balance and will quit their job to get it elsewhere. Define what fair, good, and excellent performance includes so employees don’t feel unfairly criticized and can improve their performance responsibly.
5. The ability to work from home a few days a week. This makes for happier, more loyal employees.
6. Ask for feedback. How are you doing managing your company? What are the perceptions of your staff on your performance? What are you doing to improve? New managers should know their staff will evaluate them regularly, and anonymously, where possible. Are they willing to improve their management skills?
Different issues arise as a company grows. Pay attention. When I owned an independent adjusting company in the Chicago area the outside investigators who worked for me were highly skilled. When we got together there was a great deal of ribbing and jockeying for some kind of superiority I didn’t quite understand.
I thought of us as a team. We were one exclusive, competent company who handled the toughest workers compensation and liability claims in the city, for the best insurance companies. I wanted to create unity not competition within. One Saturday I asked the investigators to come in for the morning. I had them each read two of their co-workers’ files.
I asked them to verbally critique the work of their peers. They worked independently being responsible for each assigned investigation until conclusion. The result was heartening. Each one was humbled and impressed with the caliber, professionalism, depth, and insights of the people they worked with. Never before had they seen the work product of their peers.
The compliments were genuine and respect sincere. There was an elevated sense of camaraderie. We all belonged to the same ‘club’ of outstanding service and talent. We were more united and the one-upmanship stopped. I knew we had the best investigators in the city but they didn’t know until they experienced it for themselves.
The result was we had no turnover for five years before I sold the company. The loyalty, integrity, comfort, and trust we enjoyed was unique. Situations arise all the time that require an individualized solution. If one approach fails to get desired results, think of a new strategy. Ideas are free, turnover is not.
Leadership is not hard if you’re willing to serve your employees the way you serve the customer. Lower hiring costs by increasing retention. Loyalty is not a given. Earn it and everyone wins.
About the Author: Kimberly Schenk is a recruitment coach and mentor. She trains both individuals and corporate staff. Kim teaches the full cycle recruitment process and has an updated book available online called TopRecruiterSecrets. Learn more by visiting Kim’s blog about corporate recruiting.