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What are the top reasons why businesses may have increasing staff turnover?

There are many reasons why businesses have trouble retaining their employees that they might not be noticing.

Businesspeople. Image by Tim Sandle.
Businesspeople. Image by Tim Sandle.

Staff turnover refers to the leaving of current employees and the arrival of new employees in a short period of time. Voluntary turnover is the willing exit of an employee from a company for reasons like better growth opportunities, continuing education, or retirement.

This swinging door of workers usually signifies that employers are having trouble retaining their employees, creating the necessity to keep bringing new people on board. This situation also signals concern with the workplace culture.

This can result in high costs when it comes to training and a lack of reliable staff. There are many reasons why businesses have trouble retaining their employees that they might not be noticing.

James Dooley, the founder of FatRank, tells Digital Journal about the main factors in the workplace that could be increasing staff turnover.

Lack of Benefits

One of the biggest reasons why employees leave their positions is because they seek better benefits. Benefits include dental insurance, sick pay, a good pension, holiday pay, maternity leave, and other services included in an employment contract.

Dooley  says: “Businesses that provide a minimum amount of sick or holiday pay and don’t include many other benefits to compensate their employees for their hard work are likely to see higher turnover rates, because employees know they can find better. A big motivator to keep employees content in their positions is to offer them more than just monetary compensation”

He adds: “If you conduct exit interviews and notice that the majority of employees are leaving due to a lack of benefits, you can ask them what kind of benefits they would want in order to stay with the company. Then, when you bring new employees in, you can offer new benefits to them in order to make the job more appealing.”

As a key remediation, Dooley recommends: “Giving customised benefits to employees shows them that you care about them as a whole, not just as an employee”, says James. “For example, if an employee is about to have a baby, make sure that they are well aware of their maternity leave benefits”.

Disconnect Between Management and Employees

Having a sociable and egalitarian work environment has been proven to be a major factor in employee retention. If people feel like they can talk to their superiors and are not afraid to ask questions, they are more likely to care more about the work they are doing.

In terms of the impact, Dooley explains: “When there is a disconnect between management and the employees in a business, the workers at the lower end of the hierarchy feel separate from major operations. This can make career advancement seem out of reach and might lead employees to find a company that focuses more on the relationship between all employees, regardless of their position.”

To address this, Dooley puts forwards: “As a manager or owner of a business, it is your job to foster an environment where people feel comfortable to speak freely”, says James. “When people’s voices are heard, they feel like they have a sense of purpose in the workplace and they are more likely to stay”.

Low Salaries and Low Raises

In increasingly costly times, not making enough money to support yourself or your family would lead anyone to seek better employment. “When it comes down to it, people do their jobs in order to have money to live, and when their needs aren’t being met, they look elsewhere”, says Dooley. 

He continues: “Companies that pay the bare minimum for hard work are not well-loved by their employees. Some will stick it out and get a second or third job, but eventually, it will not be worth keeping a job that offers little pay despite you having worked there a long time and becoming proficient at what you do.”

In addition to this, Dooley notes: “If there is an opportunity for advancement in a company, but the pay increases are not sufficient for the added workload, people will seek similar positions at other companies with better pay.”

For remediation, Dooley recommends: “Evaluate your business’s finances and figure out how you can better allocate funds to the salaries of employees that you can’t afford to lose. Offer yearly raises to employees as a reward for longevity and loyalty to the company.”

No Work/Life Balance

When people feel overwhelmed in their job and they don’t feel like they can get a break from their overwhelming workload, they may seek a new career path. If an employee is receiving emails late into the night or on weekends to the point where they cannot separate their work life from their home life, they can end up feeling completely drained.

Here Dooley opines: “Working in the modern age can sometimes feel like a rat race, and many employees, especially since the global pandemic, have found that they can still get their work done without having to work late into the night or on their days off. Because of this, many people in recent years have left their careers to try something new.”

To remediate this? “Being flexible with employee schedules and allowing timetables to change according to different needs show that you are an employer that trusts your employees to get their work done”, notes Dooley.

In addition to these main factors in the workplace that could be increasing staff turnover, Dooley advises: “It’s important to research your specific industry to see what other companies are doing to retain their employees long-term. Service industry members have the highest turnover rate as employees often get fed up with their working conditions and dealing with customers every day, while other industries like ICT and Public Administration have lower turnover rates.”

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Written By

Dr. Tim Sandle is Digital Journal's Editor-at-Large for science news. Tim specializes in science, technology, environmental, business, and health journalism. He is additionally a practising microbiologist; and an author. He is also interested in history, politics and current affairs.

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