A report in 2017 found that as much as 40% of employees leave a position they have been hired for without completing their first year. Another study found that 2% of new employees may leave after one bad day. Now from a business owner’s perspective, you might think that this isn’t a problem. A role that is left open can simply be refilled, right?
Wrong. The problem with constantly refilling roles that employees leave is that this is an expensive and time-consuming process. It will always take elements of your budget that you could use elsewhere and time that you could spend on expanding or growing your business in exciting new directions.
As well as this, if you are losing team members this quickly then it’s unlikely that you will be able to build up any significant level of loyalty in your business. If your team members aren’t loyal to your brand, then they’ll have no reason to go the extra mile for your clients or customers. This will ultimately lead to more negative reviews or just mid-level reviews. Why is this an issue?
Studies suggest that about 80% of customers are going to check the reviews before they even think about committing to the purchase of a product or service online. So, even middling reviews could be enough to make them think twice. If your employees’ hearts just aren’t in the service they’re delivering, customers will notice.
So, as well as making your business model far less efficient, employees leaving your business at a rapid rate could cause damage to your business brand as a whole and impact profit levels.
It’s a major concern and the question is, what should we do about it? To tackle the problems associated with employee churn we need to be aware of the reasons they leave in the first place. Let’s explore this in more detail.
No Incentives
First, it’s important to make sure that you are providing your team members with the right incentives to work for your business. If you do this, then you’re more likely to ensure that they stay with your company because they feel as though there is value in staying with your brand. A lot of employers forget this detail and fail to deliver more than just a fair level of pay. While this is a good starting point, employees expect a little more these days. Particularly, if they have other options to explore on the market.
The Wrong Incentives
When you are exploring incentives, you must choose the right ones for the business team that you are hiring. In other words, you need to make sure that you don’t end up in a situation where you are offering possibilities that your employees don’t need or that won’t provide real value. Classic choices would be company cars, a fuel card, health insurance, dental and various other possibilities. However, some employees would rather have higher levels of flexibility. Some businesses are now providing their employees with unlimited holiday days that they can take as they choose as a way to achieve a better work/life balance.
No Structure For Improvements And Promotions
Next, you should think about whether you are providing your team with options for improvements as well as promotions. There should always be a structure that your team can follow to do more in their position or even gain a new position in the same company that provides more responsibilities and a higher number of benefits.
When exploring different options in terms of training and upskilling do be aware that this can typically now be completed online. As such, it doesn’t cost a lot and will provide a high ROI.
Low Levels Of Pay
While this isn’t the only consideration to be aware of, you do need to think about if you are offering employees the right level of pay. In particular, it’s important to consider if the level of pay provided by your business matches the rising living costs and levels of inflation. Research suggests that most companies are not currently hitting these targets and even typical pay increases are futile due to the current state of the global economy. Smaller businesses seem more likely to support their employees here and are being rewarded by the job market for doing so.
A Poor Onboarding Process
You mustn’t simplify the onboarding process when you bring a new member into your business team. You need to think about what they want and this should go beyond a welcome pack along with a box of chocolates. Your onboarding process must be more comprehensive than this to deliver the right results that you require. If you have a poor onboarding process, then this is going to be reflected in whether your employees feel connected to your business. If you check out a resource like The HR Manager’s Guide → From onboarding to offboarding you can make sure that you learn far more about this process and why it matters.
No Office Culture
Did you know that on average people will spend 30% of their lives working? This means that the place where they work needs to be more than just an empty office. It has to have the right feeling and it needs to help your team feel connected to your brand as well as the people they are working with. So, how do you ensure that this is the case?
Well, one of the ways that you can do this is by bringing people together with different activities. These activities can occur inside or outside standard office hours. Essentially, you need to make sure that work does feel fun every once and a while rather than an endless slog for profits.
Low Health And Safety Standards
Health and safety are one of the targets that you should be hitting without even thinking about it. If there are low levels of health and safety in your business model, then your company is always going to lose valuable team members almost as soon as you have hired them. No employee should feel as though they have to work for a company that is not protecting their physical and mental wellbeing. Companies that do more here will always have a lower employee churn rate overall.
Better Options Elsewhere
Another point to consider is that employees are always going to have other options worth exploring elsewhere. Particularly, if they have the right skills and qualifications that you need to fill a particular role. So, how do you handle this particular problem? One of the ways that you can do this is by ensuring that you keep an eye on your competition and make sure that you are aware of what they offer to team members. If you can fill in the gaps that they leave here, then you won’t have any problem stopping team members from wanting to leave.
Low Levels Of Flexibility
Next, you should think about how much flexibility you are providing for your team. One of the main factors that can impact whether an employee wants to stay with a business is whether or not their needs are being heard and supported. In the wake of the COVID-19 pandemic, a lot of employees are wondering whether there is any real reason they should return to office work. Particularly when technology allows for most businesses to be run just as effectively from home. Allowing team members to operate from home or engage with a hybrid model of work will also ensure that they have a better work-life balance overall.
Lack Of Appreciation
Finally, you need to think about whether you are showing that your team members are appreciated and valued by your business. This can be about more than just delivering the right incentives. One of the best ways to do this is by ensuring that you have an open-door policy when running your company. You should be accepting of ideas that your team puts forward.
We hope this helps you understand some of the reasons why employees leave before the end of the first year. If you tackle these problems, you can build up a strong employee base that is loyal to your brand. Some employers assume that the easiest way around this issue is to hire freelancers or use outsourcing services. While this is an option, freelancers are becoming more selective when it comes to choosing business contracts. Similarly, there are now thousands of outsourcing solutions available on the market. They’re not all delivering the same quality of service. Some could seriously damage your business brand. Don’t forget, if they fail to reach the right quality standards, it’s your company that will suffer as a result.
As such, it’s best instead to focus on improving your business to keep your team members happy and ensure that they stay in their roles for longer. If you can keep your team members then you can focus on upskilling processes that will make them far more reliable to you. Ultimately, this will boost the value of your business as a whole which will be essential for the inevitable future sale.
