Your quick guide on how to keep the people you need, and save money
In 2019, the Australian Industry Group found that 8.5% of the workforce changed employers. At the other end of the spectrum, the Australian HR institute put the figure at 18%. So, somewhere between less than 1 and less than 2 in 10. That’s not too bad.
…or is it?
Replacing an employee that walks away isn’t cheap. A 2017 US Work Institute study put the cost of employee turnover at an average of 33% of their annual salary. And the higher the salary, the higher the percentage.
With an average annual Australian income in 2021 of $92,329, this is $29,808 per departing employee.
…still think that’s not too bad? What amount of sales do you need to replace that cost?
We already know it’s getting harder to find the staff you need. Similar studies now would yield a greater level of turnover. As a result, it’s reasonable to say that this cost is only increasing. It pays to keep the staff you’ve got.
This isn’t to say ZERO turnover is nirvana.
A level of employee turnover is desirable. Good new hires bring on board fresh ideas. They change the dynamic, the culture and drive the organisation forward. But there's a question you must ask yourself.
“Can I afford to spend $30K each time someone decides to up-and-leave?”
Last month I listed 6 ways to attract your new staff, but what about your current staff?
It pays to keep the staff you've got.
But how do you keep the ones you’ve got?
The first question you need to answer is…
Who do I have that I can’t afford to lose?
The unspoken reality is that, in the workplace, not everyone is equal.
The staff you can least afford to lose are the ones to concentrate on first.
How?
By providing them three ‘Must Haves’ as your Indispensables!
Clear expectations.
When goals shift or everything is Priority One, then your team becomes overwhelmed.
Things will feel out of control.
You'll appear to lack any control.
Nervous staff become restless staff eyeing their nearest exit door.
Be crystal clear on what's expected so there's no doubt within your team.
Clear, regular, genuine feedback and recognition.
Feedback needs to be more than the formal, and sometimes awkward, meetings twice a year.
Recognition isn’t reserved for when the results are in.
Recognition at key milestones in their journey is what keeps them going. Its more likely to push them through to completion (i.e. stay!) and deliver the results.
The respect they deserve. …via three I’s, and one F!
Seek their input. You’re not abrogating your responsibilities. You’re involving them in your decisions because you respect their judgement. The team feels valued and becomes invested in the outcome.
Keep them informed. Internal communication is critical to your credibility. Their trust in you grows when you include them in your confidence. They need to hear of developments direct from you, not second-hand.
Give them their independence. Don’t micromanage. Ever. Enough said.
Make room for some fun too – Laughter’s the best medicine and works wonders. A team that doesn’t share a laugh is one that won’t last. When nobody’s around, even the most sombre Undertakers share a laugh together.
Remember…
Staff turnover is a given.
Finding new staff is tough.
You need to make sure you’re doing what you need to keep the ones you’ve got, especially the ones you need.
You need to ensure what you spend on staff turnover is an investment in strengthening your team, not a cost.