Employers around the world are becoming increasingly aware of the importance of employee retention and its role in their success. With over 47% of HR professionals indicating that employee retention was their top talent management challenge in 2020, companies are now taking proactive measures to ensure they’re effectively engaging with staff and fostering a positive working environment.
To stay ahead of the competition, there are eight employee retention strategies for 2023 designed to help employers retain their most valued staff members. By implementing these strategies, employers can achieve successful employee engagement that will have long-term benefits for both businesses and employees alike.
Strategy #1: Employee engagement programs
Creating employee engagement programs is a great employee retention strategy and key to successful employee retention. Companies with employee engagement programs that incorporate open communication, feedback and opportunities for professional development and growth can foster a positive workplace culture.
Doing so allows them to keep high performers and talented workers and achieve the highest employee retention rate possible. As shown by employee retention statistics, employee engagement software can be beneficial in retaining top talent and fueling job satisfaction among staff members.
However, surprisingly, only 16% of companies currently utilise technology to measure employee engagement. Even in today’s highly digital world, the importance of employee engagement is often still underestimated. As a result, many organisations remain unaware of how employee engagement affects employee performance and staff retention.
Attracting and retaining the best talent requires effective employee engagement programs backed by employee retention strategies such as software solutions.
Related Reading: How to Measure Employee Engagement: 10 KPIs and Metrics to Use
Strategy #2: Flexible working arrangements
Employee retention strategies are a key factor in ensuring the sustainability and prosperity of any organisation, and one such strategy is leveraging flexible working arrangements. This can include the option to work remotely, flexible scheduling for employee balance, or hybrid working arrangements.
These employee retention strategies offer multiple benefits to both the employer and employee related to recruitment costs and employee satisfaction. Employers no longer need to prioritise geographical proximity when recruiting new staff, while employees enjoy greater autonomy over how and when they choose to work.
By capitalising on these advantages, organisations can retain their top talent more effectively with fewer resources. The flexibility of where and when people work has become an increasingly important employee retention strategy, with 82% of businesses viewing it as a competitive advantage to attract and retain the right talent.
The UK government has even introduced new guidance encouraging new employees to ask for flexible working on their first day of employment, which is a huge step in recognising the growing demand. Gartner’s survey of over 10,000 digital workers showed that 43% experienced higher productivity with work-hour flexibility, indicating this could be a valuable employee retention strategy.
Related Reading: What Are the Differences Between Agile, Hybrid & Flexible Working?
Strategy #3: Work-life integration
Of course, flexible working also has a net benefit on work-life balance for employees. Work-life integration can drastically improve employee and employer relationships. It is an employee retention strategy that an organisation adopts to encourage a healthy, productive balance between the home and work environment. The benefits of successful strategies include improved employee satisfaction, increased staff retention and reduced employee burnout.
Work-life balance incentives allow employees to manage their professional and personal responsibilities more easily while staying engaged with the company. And employees want it. Working in a company that promotes good work-life balance is highly attractive to jobseekers in the UK, as evidenced by the fact that over two-thirds consider a healthy work-life balance even more important than salary.
With the knowledge that employee turnover can cost the organisation between 16% and 20% of their employee’s salary (depending on their role in the company), companies should strive to put employee satisfaction first to maximise employee retention and reduce the turnover rate.
Related Reading: The Cloudbooking Handbook to Supporting Employee Well-being and Mental Health
In a study by Ehstoday, it was found that over 25% of employees who had insufficient support from their employers in maintaining a healthy work-life balance were planning on leaving their job within two years. This speaks of the importance of offering a work-life balance program as well as employing other employee retention strategies.
Research shows that by offering better work-life balance programs through remote work offers, companies have seen a 25% lower employee turnover rate and workers with good work-life balance tend to work even harder. Therefore, organisations need to recognise this issue and implement far-reaching employee retention strategies to ensure maximum staff satisfaction, valuable employee contributions and desired financial goals.
Related Reading: How to Support Work-Life Balance for Employees: The Ultimate Cloudbooking Guide
Strategy #4: Financial incentives
It’s essential to have high-quality staff who stay for the long term. Financial incentives are a popular employee retention strategy that helps organisations retain top talent within their ranks. This can involve providing competitive salaries and benefits, offering performance-based bonuses and promotions, as well as implementing profit-sharing and stock options.
By offering these tangible rewards on top of traditional salary packages, organisations can show real commitment to employee satisfaction and retention — putting them in an excellent position to continue growing their business over the long term.
And financial incentives don’t have to mean a higher salary or employee of the month Amazon vouchers. Consider alternatives such as:
- Customised paid holidays
- Subsidising green transport
- Unlimited sick leave
- Profit sharing among employees.
A lack of recognition will lead even your most loyal employees to leave the company. Incentivising employees pays off in spades. Rewards such as competitive salaries and benefits are fundamentally important if you want to retain your talented staff.
Strategy #5: Employee wellness programs
Employee retention strategies are essential for the success of any organisation. Wellness programs that focus on employee physical and mental health are an effective way for businesses to boost employee morale and reduce employee turnover.
Providing access to health and wellness resources can help strengthen employee commitment, encourage healthy habits and lifestyle choices, and ultimately promote employee retention. Studies have shown that 67% of employees working in organisations with wellness programs favour their job more, making them likely to recommend the company to others.
In addition, offering wellness programs can significantly reduce the cost of voluntary turnover due to staff burnout — estimated at 15-20% of payroll budgets each year — thus amounting to hundreds of millions of dollars every year. Lastly, by offering recognition-led wellness programs, employers can foster a sense of belonging in employees, ensuring more loyalty towards their current organisation.
Related Reading: Are You Creating Psychological Safety in the Workplace?
Strategy #6: Recognition and rewards programs
To retain essential employee talent, employers should implement employee retention strategies focusing on recognition and rewards. This could include providing regular feedback to employees for their work, incentives for top performers, and celebrating the company and individual milestones. Studies demonstrate the importance of employee recognition:
- Employees who feel lonely are two times more likely to quit
- A Gallup poll suggests that 65% of employees currently feel unappreciated
That’s a sobering series of stats. Employers must take steps to improve employee retention with recognition and reward programs. Ensuring their staff feel appreciated and connected with their workplace is key to sustaining employee satisfaction and keeping employee turnover as low as possible.
Strategy #7: Employee development and training
Train your team or lose them. Building employee development and training programs into your employee retention strategy is essential for any organisation looking to provide employees with a pathway to career success.
By encouraging continuous learning and skill development, businesses can incentivise team members to stay longer and achieve higher levels of success. By creating employee training programs that support career progression and advancement, employers can provide a clear roadmap for their staff while increasing employee engagement and retention.
Related Reading: Apprenticeships, Mentoring, and Graduate Programs in the Post-Lockdown Hybrid Workplace
Investing in employee skills will be beneficial in the long run, as 94% of employees indicated they would stay at a company longer if it invested in their professional development. Creating training opportunities for your team is one of the most effective ways an employer can craft an employee retention strategy that encourages employee loyalty and cultivates talent retention.
Losing employees due to minimal learning opportunities is a huge burden for any business. It is especially painful when you consider that these employees are usually eager, curious individuals who make great contributors to an organisation. Therefore, having an effective employee retention strategy that prioritises employee learning is critical to staff retention and employee satisfaction. Invest in your team member’s development and they’ll stay longer.
Such employee retention strategies should focus on establishing and nurturing long-term employee relationships by supporting their professional development ambitions. This could include investing in tailored talent retention programs such as creating company-run workshops or providing access to relevant online courses — all of which contribute to employee engagement and help demonstrate recognition of employee efforts.
Overall, such investment ultimately helps build employee trust and results in greater employee satisfaction.
Related Reading: The Great Resignation: New Employee Expectations Post-Covid
Strategy #8: Culture of trust and transparency
A culture of trust and transparency is a proven employee retention strategy that gives organisations higher levels of employee satisfaction and productivity overall. By encouraging employee voice and dialogue, this culture creates accountability as well as responsibility for both management as well as staff.
Additionally, investments in diversity are seen to benefit employee retention within an organisation but also give it a more positive external perception, with industry leaders recognising the high calibre of talent within the organisation. A work environment that incentivises staff trust and open communication allows for the business to continue its growth and development.
Related Reading: How to Build Employee Engagement, Satisfaction, and Increase Staff Retention
Save money, keep your talent
Implementing the right retention strategies is essential for successful staff retention. To ensure that these initiatives are effective, ongoing evaluation and adaptation need to take place. It is necessary to measure the efficacy of any employee retention strategy and make adjustments accordingly.
Adapting employee retention strategies to fit the specific needs of a business helps ensure that the talent retained is top-notch and capable of performing their duties well. By maintaining an awareness of how employee retention initiatives are working and adjusting them when necessary, businesses can optimise their efforts to retain talented individuals in their workplace.
Stay on top of the latest workplace trends with The Future of Work: 8 Trends in Workplace Transformation Report produced by Cloudbooking in collaboration with YouGov. Don’t fall behind your competitors and make sure you know what your employees are looking for in 2023.
