Five reasons your employees are leaving (and what to do about it)

During the most recent recession, people who weren’t laid off stayed put at their jobs, clinging on for dear life. However, as the economy has picked up steam, more companies are hiring again and, thus, more people are jumping ship. Still, the effects of turnover on a business can be quite costly. Studies indicate that replacing an employee costs anywhere from 20% of an employee’s pay for hourly, low-skilled work, to a couple year’s salary for senior-level executives. So churning through employees at any level can cost quite a heap of money. If you’re a manager or an executive, how can you keep your workplace turnover low? Recognize that people change jobs because of a pull – the lure of an offer elsewhere, or a push – a reason to get out of where they are now (it’s often a combination of both). Of course, you can’t control the pull, only the push. By being aware of the common issues, which we list below, you have a better chance of keeping your best employees for the long-haul. You Well, maybe not “you” in particular. But a major reason employees leave companies is because of superiors. Ever heard the old adage, “People don’t quit their jobs, they quit their bosses?” That couldn’t be more true. Having a lousy boss – whether he/she yells, lacks vision, or is incompetent – leads to frustration, lower productivity and employees (especially top ones) setting up shop elsewhere. Yet the boss problem, while very common, is often incredibly difficult to detect. Very few people who are asked why they are leaving, say “Well, you suck as a manager.” They often use vague references about new opportunities elsewhere and how those opportunities were just too good to pass up. This is to avoid getting into an argument and “burning bridges.” What to do: If you are at the executive level of a company, keep an eye on the management styles of your leaders and how they affect the rank-and-file employee. Given the importance management plays in terms of execution and culture, make sure to call out managers who need improvement (privately) and work with them to help bolster their performance. If you’re a manager and find your employees are leaving more than you think they should, it’s time to do a bit of introspection. Ask yourself these questions:

• Am I helping my employees reach their goals, or do I merely bark orders?
• Do I contribute to making the company/organization an exciting and engaging place to work?
• Does my management style help to improve productivity?

Since we’re often not honest with ourselves, you may want to solicit feedback from peers or your own manager. Poor connection to the company and its values A key factor in employee engagement is adequate communication between the company and rank-and-file employees. Senior leadership should spend a considerable amount of time communicating with employees about the company’s strategic direction, mission and values. However, as noted by Red e App’s recent report on internal communications, executives frequently drop the ball on communicating with employees. The problem is particularly acute with hourly employees without access to corporate email addresses. What to do: If you are a senior-level manager, provide constant and consistent communication to employees reinforcing what the company stands for and how it can uphold those values. Post the information to the break room wall, host regular town-hall meetings, use Red e App … do whatever it takes.  If you don’t have time to do all of this, make time. It is one of the most important aspects of your job. Lousy advancement opportunities When asked why people leave companies, this is often one of the most commonly cited responses. It is only natural for people to want to grow within their organization. However, sometimes the company doesn’t provide a clear path forward. Unfortunately, the dead end isn’t so obvious all the time as managers often string people along in their hope of making it up the ladder. What to do: Especially for larger companies, it is important people know about the career opportunities that are available. Make sure employees who are eager to move up know exactly what skills they need to have and what benchmarks need to be met. Sometimes exemplary employees that are eager to move can’t because people ahead of them are entrenched in their jobs. If you are really eager to keep the employee at the company, you may want to find a different role or create a new role for that particular person (we understand, that’s easier said than done). In terms of skill-building, instead of looking at training as a cost, look at it as an investment. Beyond providing the obvious benefits such as tuition reimbursement and sending employees to conferences, make sure to build a culture of continuous learning and innovation. Encourage people to take on projects outside of their everyday tasks (within reason). The job isn’t challenging As time goes on, people settle into a routine. After doing a job for a while, they become eager to take on more substantive tasks. In an ideal world, the employee indicates he/she doesn’t feel challenged in his/her work. Unfortunately, an employee doesn’t always do that. Instead, the employee either leaves, or worse, sticks around with diminished productivity and negative attitude. What to do: Keep your eye out for people who are ready to take on more substantive tasks at the office. Be aware of people in the organization who might be a good cultural fit but are perhaps in the wrong role. Encourage your employees to continually broaden their horizons and step outside their comfort zone, no matter what role they currently play. Pay and benefits It is appropriate to notice that pay and benefits didn’t make the top of our list. Younger generations, in particular, have expressed they would be willing to take a pay cut in exchange for better growth opportunities and working at a company where they connect with the culture. Moreover, people who jump ship rarely do so strictly because of pay and benefits – there are usually other factors that come into play (See points 1-4). Be warned, however, this doesn’t give you the green light to cut pay. If people don’t feel they are paid what they’re worth, they’ll be more than happy to join a place that will provide them that what they need financially. What to do: During the height of the recession, many companies froze or cut salaries. Now that the economy has improved, it should be time to double check these to make sure they are in line with market rates. If raising pay isn’t an option, you may consider upping employee benefits. A popular perk is providing more flexibility or time off. Many employees who leave contend the work-life balance doesn’t work for them. Consider allowing some employees the option of telecommuting. Consider shifting people’s hours so they can better tend to family life. And an extra week of vacation won’t hurt anyone, will it? The factors above are not an all-encompassing list of why people leave. But if you make progress in these areas, you will more than likely retain your employees longer than you have before. Employee turnover costs companies billions of dollars a year, and one easy remedy is to connect them to digital communication.