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5 Proven Strategies to Reduce Employee Turnover

14 minutes
How to reduce employee turnover

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Costly, disruptive, and morale destroying — high employee turnover can destabilize even the most well-established organizations. And while a certain level of churn is a natural part of any workforce, HR professionals have the challenging task of keeping it to a minimum. Luckily, there are steps your business can take to reduce the rate of employee turnover and build stable, successful teams.

This guide covers everything you need to know on the matter, including:

  • What employee churn is 
  • Why retaining staff matters
  • Actionable tips on how to reduce turnover

What Is Employee Turnover?

Employee turnover is the rate at which staff members exit an organization over a specific time period. This is usually measured by calculating the percentage of employees who left the company in the last year, quarter, or month. 

Staff turnover can be voluntary (they choose to leave the business) or involuntary (they are fired or laid off). Moreover, the turnover rate can be calculated for the entire organization or for certain departments and job roles. 

Analyzing staff turnover rates enables HR professionals to identify which areas of the business are experiencing high churn and develop a retention plan.

Why Is Increasing Employee Retention Important?

Reducing employee turnover is integral for the success of any organization, but why is it so important? In this section, we’ll explore five benefits of reducing turnover in the workplace.

Saves money and time

High employee churn is expensive. A Gallup study estimated that staff turnover costs US businesses over $1 trillion dollars a year. For each employee that walks out the door, your HR team needs to invest money in recruiting, selecting, and training a replacement. But it’s not just about the financial impact. Time spent replacing employees is time that HR professionals could spend on other important tasks. 

Enhances customer satisfaction

Seasoned employees tend to be more engaged, committed, and knowledgeable about your products and services. As a result, they provide customers with a better overall experience. Regardless of their potential, new hires will have a learning curve, and this can affect their ability to solve customers’ issues efficiently.

Besides, your clients may be used to working with a particular employee. When that team member leaves, this can inconvenience the client and disrupt workflows. Retaining experienced employees ensures a seamless and consistent customer experience.

Improves employee performance

When workers stay with an organization longer, they understand the company culture, processes, and products better. In turn, they are more productive and efficient and require less support from managers. All of this leads to better employee performance and greater productivity.

Boosts morale

There’s nothing worse than working at a company where your colleagues are leaving in droves. When an employee leaves, the remaining team members usually end up picking up the slack until a replacement is recruited and trained. That alone can create tension in your teams. Add to this the psychological impact of a constantly changing team and you’ve got yourself some low morale. On the contrary, when you reduce employee turnover, you improve overall morale and foster a stronger sense of community.

Safeguards company knowledge

The longer employees stay in the business, the more knowledge and experience they gain. By improving retention and facilitating knowledge transfer in your organization, you can ensure vital information doesn’t exit the business. In turn, this leads to a more knowledgeable workforce with fewer skills gaps (and saves employees a significant amount of time searching for the information they need).

How to Reduce Employee Turnover

As mentioned, high rates of employee turnover can impact your business and bottom line, from affecting company morale to inflated recruitment costs. As such, organizations invest significant time and resources in developing strategies to reduce employee turnover.

General tips on how to improve staff retention

An employee retention strategy should be tailored to the organization. That said, there are some common strategies that have proven effective across any industry:

  • Offer a competitive compensation package and benefits that align with industry standards
  • Offer continuous professional development opportunities, including regular training, tuition reimbursement, and clear career paths 
  • Create a strong feedback culture and reward high-performing staff members 
  • Build an employee recognition program that offers bonuses, performance-based rewards, and non-monetary incentives
  • Foster a safe and positive work environment by offering flexible working options (where possible), adequate resources, and transparent policies

Now we’ll explore some best practices for reducing high employee turnover and retaining top talent in four key industries: healthcare, retail, manufacturing, and restaurants.

How to reduce turnover in healthcare

The healthcare industry is a fast-paced and highly stressful work environment, which can negatively impact staff retention rates. In order to retain staff and improve employee engagement, a clear strategy is needed. Here are some ways to achieve this.

  • Implement a patient-centered care approach that encourages employees to participate in the decision-making process (policies, protocols, and patient care). By including employees, they feel more engaged, committed, and heard in the organization.
  • Provide emotional support programs and resilience training to help employees cope with stress, burnout, and emotionally challenging situations. This could include peer support networks, counseling, and training on stress management. 
  • Create an efficient staffing and scheduling system to improve staffing levels, prevent excessive overtime, and distribute workloads fairly.
  • Establish mentorship programs that connect junior staff with seasoned practitioners to show a clear career path and give junior employees extra support.

Also read: Mentorship Program: All You Should to Know in 2023 [Expert Insights]

How to reduce turnover in retail

Retail staff have a lot on their plates. From dealing with angry customers to working long hours, it can be a stressful working environment with a high rate of turnover. However, with the right strategies in place, organizations can boost retention rates.  

  • Provide staff with the necessary tools and equipment to do their jobs properly. When possible, invest in the latest technology to optimize efficiency and reduce employees’ workloads.
  • Foster a positive customer experience. Give employees the training and tools they need to provide outstanding customer service. This makes their jobs more rewarding and reduces the number of complaints they have to deal with.
  • Create an employee benefits program that offers discounts, perks, and partnerships with other local businesses. These benefits (coupled with competitive pay) will make employees feel valued and foster a sense of loyalty.
  • Improve onboarding to ensure that new hires have proper training and support. Offering a comprehensive onboarding program sets staff up to succeed and creates a good first impression. In turn, this leads to more productive and engaged employees.

How to reduce turnover in manufacturing

Long shifts and a high-risk working environment can take their toll on manufacturing staff. As such, organizations must work hard to retain seasoned staff. Here are some best practices to follow.

  • Prioritize safety by implementing strict protocols, offering regular training, and providing adequate personal protective equipment. Doing so demonstrates to employees that you value their welfare, making them feel more secure and appreciated. 
  • Promote a healthy work-life balance by offering adequate breaks, flexible work schedules (where possible), and a comprehensive employee well-being program.
  • Invest in strong leaders to ensure that employees have clear directions, support, and the mentorship they need. You can achieve this by defining the right employees and providing them with comprehensive leadership training that develops skills such as conflict resolution, communication, and coaching.
  • Implement lean manufacturing practices to streamline employees’ workflows and get them involved in the manufacturing process.

How to reduce turnover in restaurants

Hectic work environments, long hours, and inconsistent schedules; restaurant staff face quite a few challenges. As a result, turnover tends to be high in this industry. Here are some ways to retain top restaurant employees.

  • Implement fair shift scheduling practices to give staff greater security and improve work-life balance. This could include giving advanced notice of schedules, using software to make the process fairer, and taking employees’ preferences and availability into consideration. 
  • Offer cross-training opportunities to empower employees to develop their skills. For instance, allow employees to train as kitchen staff, servers, hosts, and bartenders to enhance their industry knowledge. 
  • Encourage employees to share feedback and ideas on everything from operations, menu, and customer service. Not only is their input valuable, but it fosters a sense of ownership. 
  • Provide certifications and incentivize staff to pursue further education in the industry. Reward employees with certificates and financial assistance to continue their professional development. This will ensure they stay loyal and grow with the business.

A Surefire Way to Reduce the Employee Turnover Rate — Online Training

Providing continuous learning and development opportunities is a surefire way to reduce staff turnover, no matter the industry. On top of building a highly skilled and engaged workforce, investing in employees’ professional development shows that you value your staff. As a result, this sparks loyalty and increases job satisfaction.

The best way to provide ongoing training to your workforce is to move it online. To make online training flexible, cost-effective, and scalable, you’ll need a learning management system (LMS). It empowers your employees to learn when and where they want, at a pace that works for them. Plus, it lets you manage all training activities easily. 

In this section, we discuss six ways that online training delivered via an LMS can contribute to lower turnover rates.

1. Optimize onboarding

Retaining employees begins during onboarding. A study by the Brandon Hall Group revealed that organizations with a comprehensive onboarding process increased new hire retention rates by 82%.  

An LMS can streamline and enhance the onboarding process by giving employees flexible access to the resources they need in order to settle in. Moreover, employees can access the content whenever they need a refresher, thereby improving knowledge retention.

Also read: The 11 Best HR Tools for Streamlining Your Workflow in 2023

With an LMS, you can also automate time-consuming tasks associated with training new staff. For example, the iSpring Learn LMS allows you to automatically enroll new employees in onboarding programs, send reminders, and monitor learner progress. This frees up time for HR teams and managers, allowing them to dedicate their efforts to making new recruits feel at home.

LMS notification

2. Ensure compliance and safety training

If your workforce doesn’t feel safe and confident at work, they’re unlikely to stick around. Conversely, organizations that prioritize workplace safety often enjoy improved retention rates. Besides, almost every industry requires staff to undertake compliance and safety training to ensure they’re up to scratch with the latest regulations.  

By delivering compliance training via an LMS, you can guarantee that all employees have completed the necessary training. Not only will you save yourself any costly fines or penalties, but you’ll make employees feel safe in their roles. And that is priceless.

Safety online course

3. Provide engaging training content

When we refer to learning and development opportunities, we’re not talking about stuffy day-long lectures. Effective employee training is concise, engaging, and timely. An LMS supports multiple types of training, so you can cater to different types of learners. This will help engage employees and demonstrate your commitment to your staff, leading to better learning outcomes and a more loyal workforce.

The iSpring Learn LMS comes bundled with a full-featured authoring toolkit, iSpring Suite, that enables you to build great eLearning content in minutes. You can create slide-based online courses, quizzes, training videos, role-play simulations, and more.

Take a look at what you can create using iSpring Suite:

4. Track training results and manage performance

It doesn’t matter how stellar your learning and development strategy is; if you can’t measure the results, you’ll be left twiddling your thumbs at the next budget meeting. Once upon a time, training success was measured by how many hours employees spent in a classroom. Let’s just say that didn’t provide the most accurate picture.

LMSs with robust analytics and reporting take the guesswork out of gauging training success by providing clear data on employee performance. iSpring Learn is a great example. HR and L&D teams can quickly pull custom reports to visualize key success metrics and track employee training. This significantly enhances performance management. 

LMS reports

Managers can use reporting data to give employees tailored, constructive feedback and easily spot knowledge gaps. What’s more, they can follow this up by creating personalized learning paths to plug these skills gaps and improve performance. As a result, employees develop their skills and feel supported in the process, leading to higher job satisfaction.

Learning track

5. Make learning timely and flexible

The best way to empower employees and make them feel supported is to offer a flexible learning process. That’s where an LMS really shines. Staff can train at their own pace, on their own schedule, and on their own device. 

Mobile learning is a big part of this. For instance, iSpring Learn comes with a user-friendly mobile app so employees can learn when and where they need to, right on their smartphones. Whether brushing up on their product knowledge before closing a sale or checking out a tutorial video on the manufacturing line, an LMS gives employees 24/7 access to vital knowledge.

LMS mobile app

FAQ on Employee Turnover

Here you’ll find the answers to the most commonly asked questions about decreasing staff turnover.

How can I measure the success of my employee retention strategy?

Some common metrics to measure retention include:

  • Employee turnover rate
  • Average length of employment
  • Time to fill vacant positions
  • Employee satisfaction and engagement surveys
  • Performance and productivity indicators – Compare relevant KPIs like sales targets, project completion rates, and customer satisfaction ratings.
  • Exit interviews – Analyze employees’ feedback to gain insight into why they are leaving the business and their overall satisfaction
  • Training metrics – Use an LMS to track training participation and completion rates, then assess whether employees who engage in training and development opportunities have higher retention rates than those who don’t
  • Employee referral rate – How many new hires come via employee referrals

Can fostering an inclusive work environment reduce staff turnover?

Yes, fostering a sense of belonging empowers employees to be their authentic selves, leading to higher engagement and loyalty.

Here are some ways organizations can build an inclusive culture:

  • Promote diversity and implement diverse practices into the hiring process
  • Offer diversity and inclusion training
  • Implement inclusive policies and equal opportunity
  • Create employee resource groups
  • Partner with external organizations to celebrate and support diversity initiatives

Wrapping Up

High staff turnover rates can disrupt your organization, dampen employee morale, and cost a fortune. Therefore, investing time and resources into reducing employee turnover is a must. A successful employee retention scheme will focus on boosting employee engagement, improving learning opportunities, and prioritizing well-being. While it won’t happen overnight, the long-term impact of improving retention rates is huge.

Moving training online and investing in an LMS can significantly enhance your efforts in a number of ways. A robust learning management platform like iSpring Learn allows your organization to centralize training activities, measure the impact of L&D initiatives, and reduce costs. As a result, L&D teams have more time to dedicate to what matters: supporting employees with their professional development.

Are you ready to leverage an LMS to tackle high turnover? Sign up for a free demo of iSpring Learn today!