The 8 Best Retention Strategies for 2023

16 Jan ‘23
3 min
Relationships
Work performance
Editorial Board OpenUp
Gecontroleerd door Psychologist Paul Hessels
“Oh well, you’ll find something new in no time!” It’s likely you’ve overheard someone saying this to reassure their friend who’s just quit their job.  And yes, the job market at the moment is good for candidates. But staff turnover is high: the average employee turnover rate in the UK is approximately 15% per year, although this varies drastically between industries.  The staff turnover rate has become hugely expensive for organisations. That’s why we’ve put together a list of the best employee retention strategies your business can adopt in 2023. 

 

Voluntary resignations make up one of the largest hidden running costs for most companies: when an employee leaves, so does their talent. And looking for a replacement, as well as onboarding and training them costs a lot of time and money. Gallup estimates that the cost of replacing a departing employee ranges from one-half to two times the employee’s annual salary. 

 

That’s why it pays to invest in retention, especially when you consider that 52% of departing employees state that their manager or organisation could have prevented their resignation. Read on for the best retention strategies for 2023. 

 

1. Analyse  why people are leaving

 

Knowing exactly why employees are leaving means you can address the specific causes. Make sure to conduct effective exit interviews with each employee who leaves. 

A large-scale study in 2021 found the following reasons to be the most significant causes of voluntary resignations:
  • Lack of career opportunities: growth, promotions, training and a sense of accomplishment (22%)
  • Directly work-related reasons: stress, access to resources, the market the organisation operates within, range of tasks, feeling fulfilled (11%)
  • Health and family: caring for a child or elderly person, (work-related) physical and mental health (11%)
  • Work-life balance: travel time and working hours (11%)
  • Salary and rewards: wage, job perks and bonuses (10%)
  • Relocation (9%)
  • Management: professional conduct, feeling supported, knowledge and skills, communication (8%)
  • Culture: corporate culture, facilities and physical environment, mission and values, safety, diversity and colleagues (7%)
  • Retirement (6%)
  • Other (5%)

2. Hire the right people

 

The ultimate retention strategy is to only employ people who aren’t likely to leave. Since you don’t have a crystal ball, you ultimately can’t know exactly how long someone is going to stay. That said, you can look to hire people who are a good fit for the position on offer. These factors impact whether the applicant is right for your organisation: 

 

  • The skill set of the person applying should match the position, or the person should be able to  develop the necessary skill set. Over-qualification is a red flag.
  • The applicant isn’t a frequent job switcher.
  • The position is the logical next step in the applicant’s career path.
  • The company culture is a good fit for the applicant and vice versa, or the applicant will be able to  have a positive influence on the corporate culture (remember that diversity is a good thing and you shouldn’t write people off based on their background or identities!).
  • The applicant’s vision matches the company, or the applicant can have a positive influence on the vision (remember that purpose is becoming increasingly important for employees).
  • The applicant agrees with the company values.
  • The applicant is happy  with the salary and perks on offer.

 

3. Establish a good onboarding process

 

A good start is half the battle. Most people resign in their second year, which suggests that they didn’t have a good start.  So, a positive onboarding experience is hugely important.

 

If employees get the correct training, they will feel more comfortable in their role and ready to hit the ground running. The better your training programme is, the lower your rate of voluntary resignations and the better your employees will perform. Win-win! 

 

4. Map out paths for progression

 

The magic word for retaining staff  in the long run is perspective. Would you have kept hitting the school books if you hadn’t known where your next grade would get you? Probably not. The same applies in your career: when people have consistent milestones to work towards, they stay (motivated) for longer. And as we’ve said, 22% of employees leave due to a lack of progression.

 

A path for growth consists of increasingly challenging work tasks, new roles with more responsibility, a higher salary, training and education. Some organisations, for example the Big Four, choose to make this path very concrete and measurable. 

 

5. Offer external guidance and support

 

Stress and problems with their physical and mental health play a significant role in staff resignations – as well as a lack of access to support. OpenUp offers employees professional assistance in preventing stress and mental health problems. 

Employees can contact our licensed psychologists directly whenever they like, without needing to go through HR or the organisation. They can do this via an online chat and video link, as well as  guided group sessions and mindfulness. We’re here to help your staff to avoid mental health challenges. 

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6. Be flexible with working hours and location

 

A healthy work-life balance is very important for employee retention. During the COVID-19 pandemic lockdowns, many people experienced a better balance as a result of spending more time at home and less time commuting. By giving employees the opportunity to keep working from home, you’ll help them maintain this balance.. In addition, be flexible – to the extent that tasks allow – with working hours. As long as work is getting done, it doesn’t matter when it’s done, don’t you think? 

 

Learn more about promoting a healthy work-life balance in our article on it.

 

7. Train your managers well 

 

8% of people leave because of problems with their managers: problems with their professionalism, knowledge and expertise, methods of communicating and the support they receive. A good manager plays a crucial role in retaining employees.

 

Employees often get promoted to management because they’re good at their jobs, but leading a team is a whole new job in itself. At OpenUp, we understand that. 

 

8. Create a positive corporate culture

 

Take these  steps to develop a positive corporate culture include:

 

  1. Make sure you have a clear vision and objectives. This way, employees will understand what the company wants to work towards and how they’re contributing. Employees are placing increasing importance on a purpose that aligns with the values they have in their daily lives, such as creating a sustainable and fairer world. 
  2. Focus on inclusion and respect. Make sure that everyone feels valued, regardless of their background or identities. 
  3. Promote transparency and open communication. 
  4. Give employees the space and confidence to put their own ideas and initiatives into practice. This way, you’ll create a sense of ownership and responsibility. 
  5. Be supportive HR professionals and managers. Listen to employees and take their needs and concerns seriously. 

  

Every day, our psychologists talk to employees who are thinking about quitting. Want to know how their experience can help you further? Book a demo with us. 

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