Employee Retention has quickly been regarded as the #1 priority for HR and Management teams amidst the Great Resignation. With Employee Turnover soaring in recent years, companies have had to compensate drastically due to a loss of talent and productivity, an increase in recruitment costs, and more. (Try our Cost of Turnover Calculator here.) We've compiled a list of statistics that reveal common employee retention and turnover themes to help you make better people decisions moving forward.
Here are 17 statistics that show why Employee Retention should be a priority in 2022:
- Employee retention has been ranked as the top priority by 87 percent of HR leaders in 2022 for the upcoming years.
- A third of employees leave their jobs within the first SIX months.
- A strong onboarding program has the potential to increase retention rates by as much as 82%!
- The cost of replacing an employee can go up to 213% of their annual wage.
- Employees working with poorly rated managers are four times more likely to change jobs.
- 27% of employees leave their organizations because they feel undervalued or under-appreciated for their work.
- Only 39% of employees were recognized for their contribution in the three months before their last job departure.
Common Pain point: Recognition - Workers that feel unappreciated and unsupported at their workplace have a high likelihood of turnover. The stats mentioned above affirms this. This is often a sign of a poorly designed work culture - with passive managers and unfulfilled employees.
On the other hand:
8. Employees acknowledged for their good work by their managers are five times more likely to remain in the company.
Moreover, the importance of initiating and encouraging employee redevelopment programs cannot be understated. Here's why:
9. 40 percent of workers who do not receive comprehensive training quit their jobs within a year.
10. Companies that provide extensive training earn 218% more income per employee.
11. 70% of employees say they would change jobs to work for a firm that invests money into training and development.
12. 73% of employees would have stayed at their company had there been more skill-building opportunities.
The HR team at a Global Insurance Company was looking to implement a culture change and increase employee engagement, targeting their most challenging business units in the short term. Their goal was to initiate participation and activity for employees that were traditionally most resistant to engagement.
After working with Happily for 6 months, here are some of the results they achieved:
a) Overall company happiness increased by 22% after 6 months
b) Wellness success score increased from 45% to 63%, resulting in a reduction of absenteeism by 18%!
c) 94% of employees reported an increase in manager interaction
d) Recognition success score increased from 35% to 78%, with a 92% participation rate for peer-to-peer recognition and 80% for manager-to-team recognition.
How can organizations increase Employee Retention rates? The following statistics provide an interesting argument:
13. 77% of organizations focus on employee experience to raise employee retention rate.
Simple - organizations that put an emphasis on employee experience and engagement enjoy higher retention rates. Why? Because their focus on engagement allows their employees to feel more valued, heard, and aligned to organizational goals.
14. 70% of employees are highly engaged when they have a proactive manager.
Managers who are dynamically involved with everyday tasks, who train and teach, and are actively keen on giving constructive feedback and providing recognition can set the tone of positive work culture. Consequently, this can have a drastic impact - as 70 % of employees are more involved and engaged within the organization, leading to better productivity and performance.
15. Feedback improves job retention rates. Employers who frequently ask for feedback and act upon it have four times higher chances of retaining their staff.
16. 66% of highly engaged employees stated that they had no plans to switch jobs, while only 3% of them were actively looking.
17. Increased Happiness leads to at least a 12% spike in productivity.
This emphasizes the previous points. A great example of this is Google. As they started focusing on employee happiness by encouraging employee engagement, they saw employee satisfaction rise by 37%!
Bottom line: Engaged Employees remain at their jobs longer. Organizations struggling with high employee turnover may want to rethink how best to engage their employees in order to improve their retention rate.
Overall, the importance of engaging employees as part of your Employee Retention strategy cannot be understated, especially if you yearn for a high-performance, productive culture. The knock-on effects of creating a high engagement culture are too valuable to be ignored in today's world. Some of them include:
- Increased Employee Satisfaction and Happiness
- Higher Workforce Productivity
- Higher Employee Retention Rate
- Lower Recruitment Costs
- Better Work Relationships
- Better Alignment between Employee and Organization
Happily.ai is an all-in-one employee experience platform that fosters a positive workplace culture. Organizations use Happily to run daily pulse surveys, enable better conversations, provide feedback, receive recognition, develop people managers, and promote better workplace relationships. Real-time well-being and happiness insights are also available to help you better understand your teams and people. Visit us on our website or sign up for a demo to learn more about how to best engage your employees!