Employee retention and keeping talented employees is one of the biggest management challenge that facing corporation especially with recovery of the economy and most corporation started recruiting and opening new positions. What is employee retention
Employee retention refers to the ability of an organization to retain its employee. Employee retention can be represented by a simple statistic, for example a retention rate of 80% usually indicates that an organization kept 80% of its employees in a given period. Employee retention is related to the efforts by which employer attempt to keep employees in the workforce. Therefore, retention becomes the strategies rather than the outcome. Employee turnover SHRM, the Society for Human Resources Management, estimated it cost $3,500.00 to replace one $8.00 per hour employee and cost will be much high when replacing higher level Employee. The larger cost of valuable employees leaving is lost of productivity. The gap between the times skilled worker leaves and the time his replacement to ramp up to acceptable performance, and longer for productive, profitable work to match the former employee’s level. The other categories of cost are the cost of acquisition (advertising, recruitment time, background check, etc.) and the cost of replacement setup (Training, etc.) Why people leave
Researches indicate that money is not the dominant reason for people leaving organizations. Poor relation with boss, lack of recognition, lack of challenges, undefined career path and lack of growth opportunities, ineffective reward system, poor relation with colleagues, stressful work environment, insecurity, lack of motivation are the key reasons for people leaving their employers How to increase employee retention
Researches indicated for the following reasons for employee to keep their current jobs;
•Interesting and rewarding work.
•Opportunities for learning, development and career progression.
•Good employee engagement and recognition.
•Reward system that recognizes and values contribution and provides
competitive pay and benefits. • Good working environment.
•Clear, measurable and achievable goals.
•Participation in decision making process.
•Good managers and employee relationships.
Employee retention will continue be a great challenge for organizations. If employers implement strategies to increase employee satisfaction, loyalty and involvement they can increase employee retention percentage and reduce the turnover cost.
http://www.webpronews.com/employee-retention-what-employee-turnover-really-costs-your-company-2006-07 http://utpal.net/blog/43-reasons-why-employees-leave-an-organization/ http://utpal.net/blog/15-things-that-employees-want-in-order-to-feel-motivated/ Armstrong, T. (2006). Human Resources Management Practice, Philadelphia: Kogan Page Limited Shwiff, K. Best Practice: Hiring People, Recruit and keep the brightest stars, Irvington: HarperCollins. Pogorzelski, S., Harriott, J., & Hardy, D. (2008). Finding Keepers, The Monster Guide to Hiring and Holding The World’s Best Employee, Monster Worldwide LLC