Employee Retention Overview Striving for high employee retention is almost always a worthwhile effort that pays for itself in productivity, costsavings and organizational success. Regardless of an organization’s size, active employee retention efforts can help reduce turnover and the costs that come along with it. Keep in mind that it’s more efficient to retain a quality employee than to recruit, hire and train someone else of the same caliber. This section provides an overview of employee retention, employee turnover, causes of attrition and specific employment challenges in a pandemic-era landscape.
What Is Employee Retention? Employee retention refers to an organization’s ability to retain its employees successfully. Employee retention can be represented by a simple statistic or refer to an employer’s workplace strategies to keep employees in their organization. Employee retention calculations provide a baseline and point of reference when determining how a company’s retention rate compares to others. These calculations can also be used to see how retention rates at an organization change over time.
Benchmarking helps organizations capture data and continually measure their performance. Employee retention can be measured weekly, monthly, quarterly or annually to actively monitor and benchmark retention efforts. Ultimately, organizations compete against themselves and strive to improve their retention. An employee retention rate is not a one-time measurement, and it can seamlessly be incorporated into other ongoing HR or organizational metrics. Keep in mind that retention rates vary by industry. For example, an annual employee retention rate of 80%, 90% or higher is considered well above average in some cases. Industries with the highest retention rates often include government, finance, insurance and education. Lower retention rates are more common in manufacturing, hotel, retail and food industries. As organizations observe positive or negative trends in their retention rates, they will be better equipped to determine what factors contribute to their ability to retain employees.
Why Do Employees Stay? When it comes to retention, employers often only focus on why employees leave the organization. But, it’s just as critical to understand why employees stay. When an organization understands why employers 5