When running your own business, it’s imperative that you keep up to date with today’s latest labor availability rates. You’ll also want to look at your turnover rate and see how it compares with your competitors.
Fortunately, no matter what your turnover rate is, there are tools you can use to increase employee retention within your company. Here’s a quick look at the causes of high turnover rates and how to avoid them.
Top Causes of Employee Turnover
- Employer has no vision
- Poor management or supervision of employees
- No flexibility or telecommuting opportunities
- Little opportunity for promotion or job enrichment
- Employees required to work long hours
- Minimal rewards for employees
The Cost of Employee Turnover
If your company sustains a high turnover rate, your turnover costs will increase, which lowers your profit margins. Common costs (some monetary, some not) associated with an employee leaving your company include:
- Separation costs
- Lost value of departing employee’s knowledge
- Lost productivity of that position
- Overload on team during recruitment period
- Lower workplace morale and productivity
- Increase in recruiting, hiring and training costs
Tools for Reducing Employee Turnover
Are you tired of the headache and financial loss associated with losing a new employee every other week? If so, you should know that when an employee walks away from your company, most often he’s walking away from his manager, not his job. In fact, the number one reason for high turnover rates is not being able to get along with one or more managers. Have you assessed and evaluated your managers lately? If not, you may want to start. You can also take advantage of these helpful HR solutions for enhancing your employee retention rate.
1. Job Applicant Assessments
What does your job application process look like? Does it involve a drug test and that’s it? If so, then you are definitely missing out on the many valuable job applicant assessment tools that are available. From a background check to a competency screening, there are many ways to evaluate whether or not a job candidate will be a good fit with your company. Background checks allow you to check everything from a person’s past criminal history to employment history and even education verification. A competency screening can be used to assess whether or not the applicant has the knowledge and training needed to fill the position she’s applying for.
2. Career Training
When you provide training to your workers, you demonstrate that you want them to be both competent and safe in their new position; this leads to the cultivation of employee loyalty. For each new position that an employee works in, proper training should be provided. If possible, each worker should be trained for several different positions when they first come on board. In doing this, you’ll have a first-class workforce that can operate around the clock regardless of each week’s worker schedule. Cross-training employees keeps things exciting for your workers, which deters them from becoming disengaged, which is a major contributor to high employee turnover rates.
3. Predictive HRMS Software
As you can imagine, there are many types of HR solutions that can be used to reduce turnover rates. One of the best involves the use of HR Management Software (HRMS), which streamlines both the recruiting and onboarding process, providing a better job applicant experience. With better applicant experience comes the ability to attract today’s best talent.
By employing certain tools, you can be on your way to running a more successful business. It all starts with respecting your employees and finding today’s best talent. For a comprehensive look at managing turnover, grab our e-book, “Practical Tools to Manage Costly Employee Turnover.”
This article first appeared at M.J. Management Solutions, Inc.
MJ Management Solutions, Inc., is a human resources consulting firm that provides small businesses with a wide range of virtual and onsite HR solutions to meet their immediate and long-term needs. From ensuring legal compliance to writing customized employee handbooks to conducting sexual harassment training, businesses depend on our expertise and cost-effective human resources services to help them thrive.