5 Reasons Why You're Losing Your Best Talent (and What to Do About It)
Good help is hard to find. In fact, a May U.S. Chamber of Commerce report found that quality of labor is the second-highest concern of small-business owners, outranked only by inflation.
Retaining your best and brightest workers isn't just about loyalty and stability — though those are key priorities. Frankly, replacing skilled team members is expensive. First, there's the time and money you spent to train them that's lost when they walk out the door. Once they leave, you need to advertise or use a recruiter to find new talent. Then, guess what? You have to train once again, and likely pay more for that new hire (because you were underpaying in the first place.)
Keeping the workers you have just makes good business sense. Here are some of the most common causes of attrition, and what you can do to turn the tide.
1. You're skimping on compensation.
When you see departing employees making lateral moves on the career ladder, guess what? You're not taking good enough care of them.
What to do: Research similar positions on career sites such as Glassdoor and Salary.com, as well as the salary calculation tools on Monster.com, and Indeed.com. You could also check with industry associations in your field to establish a fair market rate.
While base salaries are very important, they won't tell the whole story. Do other firms pay the same base compensation, while offering annual or quarterly bonuses, or even equity? If yours is a tipping business, do you manage your system differently that the competition?
Bottom line: Money surely isn't everything, but it's a big thing.
2. You're behind the benefits curve.
We're not just talking about affordable medical, dental, and vision insurance here, though those are huge — 96 percent of private U.S. firms now offer access to healthcare insurance. Other benefits include:
PTO (Personal time off) days. The current range is 11 to 22 days annually.
Commuter benefits. A recent hybrid-working report found that full-time office workers spend $1,020 monthly on average to go into the office, while hybrid work/home spend $408 during the same timeframe.
Tuition reimbursement. About half of U.S. employers offer it.
What to do: Poll your team to identify their pain points. You can also enlist the services of a benefits broker to educate you about what's standard in your locale and industry for a business of your size.
3. You're not offering career advancement opportunities.
Employees want opportunities to grow, whether that means a clear promotion path or the opportunity to learn new skills and take on more challenging projects. However, a recent Gartner survey found that 66 percent of human resources leaders don't think their firms offer employees "compelling career paths."
What to do: Check in with your team(s) quarterly or monthly to ensure you're providing them with fresh challenges and paths to success. Consider having employees teach their skills as assigned mentors to newer colleagues.
4. Your management team is alienating the best talent
Gartner reports that only half of employees surveyed feel their managers show empathy and fairness. That's just not good enough.
What to do: If one of your managers is creating problems, work with them on a plan which may include hiring a management coach, to address their issues. A coach or consultant can analyze the manager's work style and provide feedback about how to improve it.
Then there's the possibility that after reading this post, you'll realize that you are that problem employee. Congrats, you've taken the first step: admitting that you need to change.
5. You're maintaining a rigid, pre-COVID, office-centric mentality.
The great remote-work battle has only intensified in the post-COVID years. According to the Gartner survey, only 26 percent of firms say their workers are fully complying with office-visitation policies. One big reason why employees are reluctant to return to their desks is expense, as noted previously. But there are other reasons you can address.
What to do: Enact some flexible policies — and they don't have to cost you very much at all: Be thoughtful. If an employee isn't feeling well, let them not only stay home but also declare their availability. Did someone work until midnight or travel during the wee hours for business? Let them start later the next day, whether it's at the office or at home. These small acknowledgements can enhance employees' commitment to their roles.
When you take firm action on your attrition issues, you stand a greater chance of keeping your best good people — and attracting new ones, too. Yes, it may cost you, but great staffers offer a tremendous return on your investment.
Did you know?
You should be allocating 40% to 80% of your revenue to employee costs, according to NerdWallet. This seemingly high percentage includes overtime, paid time off, taxes, and benefits.
Since 2008, Fora Financial has distributed $4 billion to 55,000 businesses. Click here or call (877) 419-3568 for more information on how Fora Financial's working capital solutions can help your business thrive.
