In recent years, securing new employees has been an overwhelming concern for businesses, with several reasons contributing to the shortage of job seekers. The pandemic has accelerated a shift to non-traditional work structures, and while companies offering remote positions have been receiving a steady stream of applicants, employers with traditional work arrangements have witnessed a decline. So why make it harder for employers with employee turnover when retaining them is more economically sound?
According to a recent Gallup study, the cost of hiring a new employee to replace a vacated position can be up to two times the salary previously allocated for that role. As an employee’s specialization increases, so does the expense associated with recruiting, training, and compensating.
James Jirak, Pinon co-op business advisor, offers insights on best practices for employee retention.
1. Engage with team members and encourage them to share their perspectives and suggestions.
People want to feel like they matter. Only one in three employees nationwide, Forbes Advisor reported, strongly agree that they belong at their current place of employment. It’s a troubling number to consider that as many as two-thirds of employees may be looking for greener pastures. It’s human nature to want to feel valued, and in the workplace, that can be amplified as employees take pride in their contributions and want to feel empowered to perform their best.
Decisionmakers, such as supervisors and board members, can greatly affect employees’ perceptions of “worth” in the company. Engaging employees by asking for their input on processes and checking-in with them, can help them feel more like a contributor to the company’s overall success and result in positive outcomes.
2. Recognize employee contributions and commitment.
Employee recognition and gratitude goes a long way toward employee inclusion and satisfaction, and unfortunately, sometimes management forgets to make this simple gesture.
“During my tenure as a former farm co-op CEO, I set aside time every afternoon to visit with employees and customers at various locations,” says Jirak. “It was amazing to see the positive transformation in employee communication and increase in dedication to our company’s mission because of engagement with leadership. The team felt valued and supported by management.”
3. Keep communication open and transparent.
Perception is reality. You may have heard the phrase, “Good news walks, while bad news runs.” Transparency in communication with employees is highly valuable in building trust. When good news occurs, communicate it with employees, stakeholders, and the public. Regularly sharing positive messages helps to create a balanced perception of the company, so that when challenging news emerges, it isn’t the sole narrative people hear.
When challenging news needs to be delivered, clear communication is still essential. Hearing unfavorable news is better than not receiving information at all. Perception is people’s reality, and when news isn’t shared with team members, speculation and varying interpretations may begin to circulate. Misinformation can often be worse than the actual news.
4. Build a future from within by supporting advancement and development opportunities.
About 44% of companies nationwide, provide a clear career path for employee advancement according to a Forbes Advisor study. Employees who struggle to envision a long-term career path with no clear advancement opportunities may begin to question their future with the company.
“Actively engaging, having regular conversations about their aspirations, and providing opportunity to further develop their skills can provide employees with a sense of stability,” says Jirak. “It can be conducive in building and ensuring their future with the company.”
Employees who actively seek opportunity and desire additional responsibilities can be great assets and contributors to company success. Keep them engaged with the company by supporting those desires and offering avenues for growth. For example, consider starting a management training program and/or mentor them for upward movement.
5. Be accessible and approachable.
As a leader within the organization, it may be tempting to stay behind the desk to complete the various demanding job responsibilities. Understandably, every operation is different, but encourage management to visit the plant floor or operation locations consistently. There is value in employees seeing their manager where they work and, in these managers, understanding what employees are dealing with daily.
“The best part of my day was visiting different locations, engaging with team members, and watching operations in action,” says Jirak. “For my benefit, it was better to have boots on the ground, than to look at the operations and people on a piece of paper.”
Consistently visiting employees and operations can help alleviate potential problems before they become serious issues. Management may say they have an “open door policy,” but make sure to walk the walk. Failing to remain accessible may lead to employee dissatisfaction.
6. Foster a workplace atmosphere that promotes well-being and cultivates a positive company culture.
Money talks, but softly. The reason we must work is to financially provide for ourselves and our family, that is just a reality. In addition to great benefit packages, companies must offer competitive wages to attract new employees. But in keeping employees, do you want income to be your only hook?
Overall, company culture is extremely important to employee retention. The average tenure of an employee today is 4.1 years, and almost one-third of new hires leave within 90 days. Many companies don’t get off to a good start. According to the Forbes Advisor, 84% of new employees felt their onboarding process was lacking.
It may be hard to hear, but if your company is experiencing a high turnover rate, look at your management. In a study performed by Development Dimensions International (DDI), 57% of people have quit their job because of their dissatisfaction with a direct manager. If your company’s turnover rate is high, invest in discovering why. Dig into the nature of the work, hours, expectations, and relationships with coworkers and management. This information can be insightful, and leadership can be trained to improve people management and employee relations.
Create a Workplace That Attracts Talent
Retaining good employees is a far better prospect than having to find new ones. When bringing on new workers, you usually don’t know what you have until you’re down the road. Put in the time and effort to become and remain a preferred employer and create a workplace and culture that attracts talent. Set the stage for employee satisfaction and success for both the employees and the company.
Pinion provides strategic planning, DPAD reporting, and other services to help you reach your co-op business goals for years to come.
Connect with a Pinion farm cooperative advisor to prepare for the year ahead.
