Economic prosperity in recent years has created a nearly full-employment economy, especially in our community! Unemployment rates are at an all-time low nationwide and even lower in the greater Reno area. Companies are competing to find and keep their best workers. Employee retention matters. Here are five reasons why:
1. Strain on Customers and Team Members
If businesses don’t have jobs documented, losing an employee can hurt customers and other employees. Consider this, departing employees can take a great deal of knowledge with them. Picking up where they left off is often difficult and puts unnecessary strain on your customers and your other employees.
2. Costs Associated with the Loss
Replacing employees costs money. The cost of replacing an employee is estimated as twice the individual’s annual salary. The estimate is even more for middle management positions. The cost doesn’t include lost knowledge or the sunk cost from the departing worker.
3. Time and Effort Necessary to Find Replacements
Recruiting new candidates takes a lot of time and effort. Furthermore, the competition for talent is tight so approaching the task can’t be done haphazardly.
It’s a reality. No matter how good your onboarding system is, it’s going to take time to bring employees up to speed. When you are short-staffed, proper training can become a lower priority which will have long term repercussions.
5. Domino Effect
Oftentimes, when an employee leaves, there is a domino effect. Others start to wonder about opportunities elsewhere. Or worse, a headhunter that plucked one employee may take aim at others. Opportunites start to look better as employees have to pick up the slack for those who have moved on too.
Management’s Role in Retention
Employee retention isn’t easy because there are a lot of moving parts. It takes a constant effort from managers to assess their strategies, communicate with their employees and deploy their retention plans.
It can feel like a daunting task. But, it’s my hope that employers and managers can feel energized and know that they are not alone. Getting invigorated and taking proactive steps to retain your team members now will save you plenty in time, money, stress and heartache later. For further assistance, reach out to the experts from HRinDemand.
Melissa Marsh, SPHR, SHRM-SCP, is a human resources consultant and founder of HRinDemand, a human resources company in Reno, NV, offering expert guidance and easy-to-use tools to help small businesses with employment regulations, compliance, employee relations, and company growth.