Employees are quitting their jobs at the highest rate since 2008, according to the U.S. Labor Department. That’s great news for recruitment. Not great news for retention. So, with the odds against it, has anyone figured out how to reduce employee turnover in the New Year? Let’s take a look.
Google is perfecting the art of the long leash by allowing its famed 14-year veteran and head of its spam team Matt Cutts an extended leave. Off since July, Cutts announced his leave will now last into 2015.
“When I joined Google, my wife and I agreed that I would work for 4-5 years, and then she’d get to see more of me,” Cutts wrote on his blog. “And now, almost fifteen years later I’d like to be there for my wife more. I know she’d like me to be around more, too, and not just physically present while my mind is still on work.”
Does Google run the risk of losing Cutts altogether? Of course it does. Do they lose money by keeping him around? Perhaps.
“But when an executive like Cutts has reached the end of his rope, allowing for some R&R on the company dime can really pay off,” says Nad Elias, Managing Partner, The HT Group. “Remember the cost of recruiting and onboarding new talent starts in the tens of thousands of dollars. Sometimes extending a ‘long leash’ is a solid move. And, if that doesn’t work, you’ve given time to allow other team members to step up and shine. Google has allowed others in Cutts’ department to essentially audition for the role in his absence.”
Brace yourself: It looks like pay raises in 2015 are of critical importance. The reasons are purely mathematical. U.S. employers are planning to give pay raises averaging 3 percent (about par with the 2.9 percent average raise in 2014 and 2013), according to a survey by compensation consultant Towers Watson. Is that because employees are greedy? Not at all.
“Your average employee is barely keeping ahead of inflation,” Towers Watson Managing Director Laury Sejen tells USA Today. “It’s a little bit disappointing.” According to the firm’s 2014 Global Workforce Study, pay and incentive programs are falling short. Among the employees participating in the survey, just 50 percent believe they were as fairly compensated as their peers, and just 40 percent see clear links between pay and performance.
“If your employees have been feeling unfairly compensated for several years now, this could be the tipping point. It’s been proven that base pay is a main reason passive job seekers become active job seekers,” Elias comments.
More flexibility and pay raises may go far to reduce employee turnover but, without the right thinking, you may be missing the point. The question you should ask yourself may not be, “How can I keep employees?” but “How can I keep the RIGHT employees?”
“Take a look at some of the best places to work in Texas,” recommends Elias. “They each offer compelling reasons for employees to show up, besides money and perks.”
“Making our employees happy is our top priority…it’s always the people, then the product,” SpareFoot Recruiter Katie Smith told us. Lisa Trahan, Director of Communications for St. David’s Foundation, shared a similar sentiment. “We treat employees as our greatest asset,” she revealed. “We have built a flexible and innovative culture that supports the personal and professional success of each employee.”
But the Real Secret Is….
With dozens of ideas like these, where can you start? Tammy Deal, vice president, Human Resources, at Compass Learning® recommends looking inward to find your way forward. It’s a strategy that nicely ties together the other three areas mentioned above.
“Leaders are always searching for a magic wand to wave instantly to reduce employee turnover, but it simply does not exist, and throwing money at the situation buys you little time,” Deal says. “The magic is in the environment you create for your teams. You reduce turnover when you create a relationally connected community who understands the purpose of the company’s vision and how their individual contributions equate to the company’s overall success. You build your teams by hiring for your culture, and then you retain the exceptional talent by recognizing and rewarding their contributions frequently and fairly.”
Are you changing your own retention strategy in search of ways to reduce employee turnover in the New Year? If so, what are they and why? We’d love to hear your thoughts.
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