Office Management & HR
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High turnover is a tell-tale sign of low morale and dissatisfied employees. Employees who are satisfied with their jobs generally don't give them up, so high turnover usually indicates a problem.
That's not to say that every employee who leaves your company is dissatisfied--after all, some will retire, leave town, quit because of family circumstances, desire to change professions, or even start a business of their own. But if you have high turnover and you're losing good employees, you may want to give some thought to the possibility that there is a morale problem.
The causes of turnover are related to the same factors that contribute to absenteeism and low morale. If workers aren't interested in their jobs, they will either stay away or leave. But being unhappy in a job isn't the only reason people leave one employer for another. If the skills that they possess are in demand, they may be lured away by higher pay, better benefits, or better job growth potential.
While you can't control other companies, you can take steps to improve morale at your business and make those employees who are with you happy and productive. That's why it's important to know and recognize the difference between employees who leave because they are unhappy and those who leave for other reasons.
Following are some of the more common reasons for high turnover in businesses:
You can learn a lot about your workforce by keeping track of employee turnover. A little simple analysis can reveal problems with the bundle of duties you've created for each position within your business.
Follow these steps for tracking turnover:
Monetary and hidden costs associated with employee turnover are also of concern. When an employee leaves your business, it costs your company in:
Once you find and hire a new employee, you'll still experience flagging productivity while the employee learns his or her new job. In other words, it costs your business money every time an employee leaves because it takes even more resources to return to the same level of productivity or level of performance that you had before.
Sometimes, though, if the worker in question was a problem performer, productivity may not suffer. In fact, you may be better off than if the dissatisfied employee had stayed on the job. On the whole, though, you're going to want to prevent turnover as much as possible because of the high costs associated with it.
If a business wants to ensure that employees remain with the business, it has to identify and emphasize the positive aspects of the business that make employees want to stay.
Some internal factors that may influence your employees' desire to stay are benefits and compensation, pleasant working conditions, opportunity for growth/advancement, and job security. In addition to the internal factors that make employees want to leave or stay, there are also outside factors that can influence your turnover. You can't do much about these factors, which include family responsibilities, financial obligations, marketability of their skills, and jobs offered by other companies. What you can do is try to make the job as desirable as possible, to minimize the chance that external factors will lead your workers to leave.
To minimize turnover, give employees perks that are perceived by them as benefits that make or break a job. Trade on your strong points. Job perks like flexible hours or better-than-average benefits might keep employees in a job that they would otherwise leave. Attempt to make work fulfilling and rewarding for your employees.
Sometimes the jobs that you have may not be particularly exciting or offer a great potential for growth, but they are still important and must be done. So how can you handle this sticky situation? Some possible options are to hire temporary employees, or to use part-time workers who are simply looking for a low-effort paycheck.