Surprising Employee Retention Statistics That Will Make You Sit Up and Take Notice
This post was penned by Frank Faeth, East Tenth Group’s Senior Leadership Advisor and Executive Coach.
Employee retention is a “hot button” topic for many CEOs and C-Suite executives I speak to these days.
Whether it’s due to issues onboarding new team members effectively, neglecting to focus on developing the employee experience, or an inability to keep up with the changing demands of a new generational workforce; many leaders are scrambling to determine where and how they can improve employee retention in their organization. This, combined with the lowest unemployment rate in U.S. history (Fortune/Bloomberg May 4, 2018), has made the marketplace more competitive than ever.
I tell all of East Tenth Group’s clients: every organization is unique, and I firmly believe that customized business solutions are the key to employee retention success. After all: every organization has a unique workplace culture and expectations of its employees.
If you’re feeling lost with your employee retention issues, I suggest you Take.Action.Now and review these important employee retention statistics that I’ve seen to date. I expect they will provide some “food for thought” for any leader and CEO interested in improving these metrics:
Today’s Must-See Employee Retention Statistics
1. One Third (⅓) New Hires Quit After Six Months
A critical component to employee retention is to outline the milestones you expect your new hire to achieve, and to outline a plan to help them achieve those milestones.
Use this process to work collaboratively with your new hire to identify not only the milestones you’d like them to achieve, but to identify what they would like to accomplish. Not only does this process help alleviate feelings of being under-challenged or overwhelmed, but it also provides an opportunity for “buy in” from your new hire, making them more invested in your organization’s goals.
Research has shown that 60% of companies fail to set milestones for new hires, giving your organization a competitive advantage in terms of attracting and retaining top talent in your industry.
2. Referred Employees Have A 45% Retention Rate After Two Years
Another reason to focus on the employee experience and cultivating a positive workplace environment is that employees will refer new hires to their managers because they like where they work.
Not only are referred hires more likely to stay with the company, but they have a much lower exit rate within two years than employees who were sourced from a job board, 80% of whom leave after two years.
The reason for this discrepancy is likely twofold: not only is the referred hire working with a friend and colleague, but given that they were referred for the role it’s likely that they are a better cultural fit than someone sourced from a job board or recruiting agency.
Want to improve employee retention? Then don’t miss out on this must-have guide filled with insights, Ted Talks, stats, and reference info to help you manage through your retention issues today.
3. 73% of Organizations Revamp Their Onboarding To Improve Employee Retention
This indicates how commonplace onboarding issues have become in the modern business landscape. Effective onboarding ensures that a new hire is properly integrated into the organization and can increase employee retention.
Updating old onboarding procedures not only increases employee retention, but it also offers an opportunity to help your new hire correlate the work they do with the values of your organization.
4. Remote Workers Are 50% Less Likely To Quit
Employees who telecommute to work report being more satisfied with their jobs than those who commute into the office.
The reasons behind this statistic are obvious: workers who telecommute are working in a comfortable environment, and can often work uninterrupted and at their own pace compared to working in a structured office environment.
With 35% of Millennials reporting that they value schedule flexibility over pay, offering the option to telecommute presents a powerful opportunity for organizations to increase employee retention.
5. 33% Of Employees Knew If They Planned to Stay With A Company Within Their First Week
This statistic shows that your company’s first impression makes a significant difference in employee retention. It also highlights the importance of an effective onboarding process which helps the new hire feel “at home” within the organization, instead of expecting them to figure it out for themselves.
Research had found that the best-in-class companies don’t start onboarding when the new team member arrives on their first day. In fact, 35% of businesses begin the onboarding process before the new hire’s first day, which can alleviate feelings of being overwhelmed, and gives the new hire time to process, reflect, and ask questions.
Employee Retention: What You Can Do To Improve
While these statistics may not draw positive conclusions about the state of employee retention, they show us that companies who step up their onboarding game and focus on the employee experience will see a significant return on investment with each new hire.
After all, organizations with a standard onboarding process experience 50% greater new hire retention than those without. This means if your organization can take these statistics to heart and reinvest in an effective onboarding program your business will see an increase in happy, productive, long-term hires.
Are your professional challenges contributing to low employee retention? Take our brief, complimentary assessment and find out.
Once you’re finished, I recommend East Tenth Group’s ebook Managing Others, part of our Balanced Leadership Framework™ to begin your development journey.
I invite you to contact myself and the East Tenth Group team to discover how we can assist your development journey, and would love to hear your feedback on this post, or via our Facebook, LinkedIn, or our Twitter profile.