2 in 5 employees are likely to leave their organization within 12 months.
The question is not one of when they’ll leave, but why they’ll leave. So, what exactly makes people quit?
For the most part, many prospective employees will carefully consider a company’s value proposition before joining the organization — the qualities that make an organization different from others.
Traditionally, value propositions are shaped by what organizations believe will make an employee choose them over others, but more leaders are shifting their focus to what will make an employee stay.
At its core, employee retention revolves around experience, engagement, and connection. An organization’s people need to feel inspired by and connected to the values, visions, and culture of their company. Organizations are paying more attention to the people-focused approach. That’s critical, given that 33% of employees don’t believe their personal values align with their organization’s core values.
Even more, 51% of companies are shifting their priorities to develop future-focused people strategies — the initiatives that make employees to stay, rather than jump ship.
Why do people voluntarily leave their current companies?
89% of employers assume that employees quit their jobs because of money.
Although salary and pay scale is no longer the deciding factor in an employee’s decision to leave their current position, it’s still one of the leading reasons for turnover.
For example, job satisfaction and meaningful work, especially among millennials, are critical drivers for turnover. According to Hays, 71% of millennial workers would take a pay cut for their ‘ideal job,’ while 44% of millennials are unhappy in their roles.
Approximately 15% of employees can’t envision themselves with a company for longer than a year. And even when employees are happy in their roles, 25% say they’re only willing to commit up to 3 years to their current company.
If it’s not all about money, why would an employee choose to quit their job? What about raises, workplace relationships, and development opportunities?
Several studies find that engagement, recognition, relationship and encouragement are reasons why people choose to remain in their roles — regardless of the pay scale. Why is that?
Any employee will crave recognition for their work. Beyond that, most will want personal and professional development opportunities. Most will want to grow while maintaining genuine relationships with their team members and leaders.
According to a global study by Mercer, recognition and meaningful project opportunities are two key ways to help employees thrive at work. By providing teams with the chance to shine and showcase their skills, organizations can foster more engagement and confidence in their employees. In fact, 15% of employees are less likely to quit if given the room to grow and spread their wings.
Spreading your wings is sometimes easier said than done. Leaders have to provide a foundation for employees to build their confidence and add to their existing skill set. Development is a key aspect of employee engagement.
For example, learning and development is often cited as a notable incentive for employees to stay with their current company. Ceridian finds that 83% of employees whose organizations provide them with learning and development opportunities are more likely to remain in their existing jobs. Similarly, 45% of millennials consider the career development opportunities of role before accepting an offer.
While the opportunity to learn, grow, and perform meaningful work is essential, employees also seek more than just the basics of a thriving organizational culture.
Consider the employee relationship.
Here at Kudos, we focus on the relationship employers build with their teams to help them thrive. This relationship will differ based on each organization, but the base of it must include trust, recognition, and communication.
As it turns out, we’re hitting the nail on the head with this approach.
28% of employees cite positive working relationships with leaders and colleagues as a top reason for staying with their companies. In contrast, 32% of employees have to wait an average of three months to receive constructive feedback from their leaders; 31% wished their leaders would communicate with them more consistently. A lack of communication from leadership can hinder teams from building meaningful, positive relationships with their mentors.
Part of nurturing this relationship includes trusting employees and empathizing with their needs, struggles at work, and desires to advance. For instance, 82% of employees would leave their current organizations for more empathetic ones. And 72% of employees would be willing to work longer and harder for empathetic leaders.
To sum it all up, leaders that regularly communicate with their teams, build authentic relationships, and voice support for their employees are well on their way to retaining high-performing team members.
Leaders have the significant responsibility of retaining their top-tier talent because employees don’t have to stay.
There is no rule book which requires an employee to devote x number of years to an organization, but leaders must recognize which patterns and practices lead to high turnover, employee disengagement, and job dissatisfaction. You may be surprised to learn that leaders and managers account for at least 70% of the variance in employee engagement scores — failing to create environments in which employees feel motivated to stay.
In other words, leaders must take accountability for their role in employee turnover.
At one point or another, every organization will face a people risk or human capital risk — both generally refer to the value an individual brings to an organization through their skills, knowledge, and expertise.
Those statistics don’t exactly inspire confidence; given that managers and HR leaders are tasked with retention and keeping employees engaged.
Under such pressure, it’s no wonder that the failure to attract and retain top talent is the number one concern for most C-suite executives.
Interestingly, Gallup finds that managers and leaders can influence at least 75% of the reasons for employee turnover. Meaning, leaders can play a proactive role, and give employees a reason to stay.
You may be wondering, “how can leaders tell when an employee is about to jump ship?”
Where do leaders and HR teams turn when employees leave consistently, or when turnover rates increase? Without relying solely on things like exit interviews or employee satisfaction surveys, how are leaders supposed to know how their organizations are performing and thriving?
It begins with listening to what employees are, and aren’t, saying. Not every employee will voice their concerns, issues, or pain points with their leaders. Leaders have to take note of how employees are doing — beyond traditional means of communication.
Kudos uses deep analytics and insights to give organizations a better understanding of how their people perform, what they value most, where improvements in company culture could be made, and how engaged their teams are.
This information is incredibly valuable to organizations and their culture, yet only 33% of companies utilize it. Even more, only 1 in 4 HR professionals uses analytics to understand why people leave their company.
By paying close attention to what employees value, what drives their performance, and the overall health of the organization, leaders nurture engagement and pin-point the key reasons for turnover.
97% of C-suite executives predict an increase in competition for talent acquisition. What is your organization doing to retain its amazing people and encourage top talent to jump on board?
Kudos is an employee engagement, culture, and analytics platform, that harnesses the power of peer-to-peer recognition, values reinforcement, and open communication to help organizations boost employee engagement, reduce turnover, improve culture, and drive productivity and performance. Kudos uses unique proprietary methodologies to deliver essential people analytics on culture, performance, equity, and inclusion, providing organizations with deep insights and a clear understanding of their workforce.Talk to Sales