16 Proven Strategies to Retain Employees and Reduce Turnover

Employee retention is a company’s ability to keep skilled employees for the long term by giving them good reasons to stay rather than look for opportunities elsewhere.

At a Glance

The best employee retention strategies include:

• employee recognition
• competitive compensation
• work-life balance
• supportive leadership
• regular feedback
• career development
• employee wellbeing
• good onboarding
• purpose at work
• ongoing training

Introduction

Staff and employee retention is an important issue if you are looking to manage an effective and happy team and workforce, and greatly reduce hiring and training costs.

You want employees who are motivated, who enjoy their work, and who are highly skilled, and these are all factors you tend to find in a workplace where staff retention rates are high.

According to a Gallup report, over half of employees are either actively searching or open to new opportunities, a strong sign that retention challenges are widespread. Similarly, the U.S. Bureau of Labor Statistics tracks millions of voluntary job exits each month, underscoring the urgency of addressing staff turnover.

High turnover rates can be very disruptive for the staff who remain, and this, in turn, can weaken the overall team morale. By focusing on employee retention strategies, in addition to reducing rehire costs, you can create a strong, effective, and happy team that thrives.

Why Is Employee Retention Important?

Employee retention matters because the cost of replacing employees is high; it disrupts productivity, weakens team morale, and can be damaging for customer relationships. Organizations with high retention typically benefit from higher employee satisfaction, better workplace performance, and significant savings in terms of recruitment and retraining costs.

1. Financial Costs of Retraining and Rehiring

Onboarding and retraining new employees is an extremely time-consuming and costly process, a cost that you could certainly do without.

Imagine if that same money and time instead were, for example, used to reward your most productive staff and to give existing employees more advanced training?

2. Continuity and Productivity

When employees are constantly leaving and positions have to be refilled, it not only disrupts the team in terms of having to help the new employees get up to speed, but it also results in lost productivity while the new employee is learning the ropes.

A team that sees staff often being replaced will find it much harder to be an efficient team!

3. Maintaining Company Culture

A company’s culture, code of ethics, and general way of working are much smoother and work much better when there is consistency in the workforce.

In companies with high rates of employee turnover, this appreciation and understanding of the company culture can be partly lost.

4. Customer Relations

As you might have experienced in the past as a customer when dealing with customer service, if an employee is new and still learning about the products and services, their service skills tend to be lower than those of an employee with many more years of experience. In other words, the quality of customer relations can be lower.

Furthermore, with high staff turnover, it becomes harder for employees to develop meaningful relationships with clients and customers.

5. Employer Reputation

Many companies with a high turnover and unhappy staff soon gain a reputation as an employer to be avoided.

The great downside of this is that it becomes harder to attract top talent and the best potential employees for your business.

6. Employee Engagement

There can be a ripple effect whereby employees who get to make new friends when new colleagues come on board, and then see these new employees leaving, can often feel as though it is time they also move on.

Furthermore, having to continually work and use up more time retraining and helping a new colleague can decrease morale over time for existing employees.

If you are providing training in this topic area, you might wish to use the employee engagement training materials.

7. Innovative Employees

Employees who stay with the company and feel valued tend to be more invested in the business and, as a result, are more likely to be innovative and provide better solutions.

Overall, staff retention contributes to a stable, efficient, and positive work environment. It allows companies to build a stronger, more cohesive team focused on achieving common goals.

Why Do Employees Leave Their Jobs? (10 Common Reasons)

Before learning how to retain employees, it can be useful to understand why employees tend to leave. 10 common reasons why employees leave are as follows:

1. For Better Opportunities

The chance to get a wage increase or training opportunities and career advancement is a powerful attraction for many, especially when hearing friends boast of how well they get treated in their roles.

2. Poor Management

Having to deal with an unfair manager or a manager who fails to create a positive and inclusive workplace. Poor management can push employees towards leaving.

3. Lack of Recognition

Management that shows no appreciation for your work and effort, commonly referred to as the recognition gap, is a sure way to drive employees away. We all need to feel that we are accepted and wanted, including in the workplace.

4. Work-Life Balance

Burnout is a very real issue, and great awareness of this exists now (see the avoiding burnout training materials for trainers). The idea of working later every day and living to work is rarely the most productive idea in the long term for any employee or manager.

A good work-life balance can equate to staff who are more productive and also who stay longer, saving on rehire and retraining costs.

5. Bad Hiring Policy & Planning

It is worth the effort in the very beginning to ensure you get the right staff for the right job. Spending time to carefully detail a job and taking the time to match the right person for the role, in the long term, is time- and cost-effective.

In addition to the skill set, ensure that the new hire matches your company’s values and ethics.

6. Limited Growth Opportunities

Employees tend to get restless and start looking for opportunities with other companies when they feel that their career growth and opportunities are not being fulfilled.

Providing employee growth opportunities through training means you not only build more skilled staff, but are also helping to fulfill this need for progression. The costs of offering training are often less than the cost of rehiring staff who otherwise leave.

7. Compensation and Benefits

It is also important to pay the going rate or at least something competitive. It is natural that employees will seek to improve their salaries.

Once again, it is worth pointing out that many companies incur a significant amount of resources on hiring and training costs, and this can often be offset by providing good benefits to employees and making them want to stay.

8. Unhappiness at Work

As a manager, always look for signs that an employee is acting differently from normal, suggesting that they are unhappy and in need of support.

Work to quickly solve any workplace conflicts before they build, and work to change an employee’s decision to leave.

How Can You Retain Employees? 16 Proven Strategies

So, what can we do as a company, as a manager, or a business owner to retain employees? Here are some ideas:

1. Offer Career Development Opportunities

Providing a clear path through the company with training that benefits and matches the long-term goals of the employee is a great way forward.

The training will, of course, also need to match the company’s goals, and if the right training is offered, it is a great way to incentivize staff to feel and help them see a long-term future within your company.

Succession planning is also vital. When employees see a clear path to leadership or specialized roles, they’re more likely to stay engaged and loyal.

A strong internal talent pipeline is also a great strategy for reducing rehiring costs and improving long-term workforce planning.

2. Provide an Inclusive Working Environment

It is so important to ensure that each employee feels included in the company, and if necessary, I suggest providing managers with training in Inclusive Management.

• No employee should feel left out, and every employee should feel that they can give input and ideas openly, and feel that they are provided with the same opportunities as their colleagues.
• Creating an inclusive, supportive workplace also strengthens your employee value proposition (EVP), giving both current and prospective employees more reasons to join and stay with your organization.

3. Support Wellness and Work-Life Balance

The understanding of mental illness and employee wellbeing is much more transparent these days, and in this respect, it is worth remembering that your employees are your business. They are an invaluable asset.

For remote and hybrid teams, it’s also important to maintain motivation and inclusion. You can explore specific strategies to motivate remote employees and build engagement across distances.

• Consider offering things such as flexible hours, the chance to work partly from home (if appropriate), and wellness-related workshops and programs.

4. Perks and Benefits

Offering perks and benefits such as access to childcare support or access to company facilities such as a gym or recreational areas, without question, helps to provide value and reasons to stay in a company.

Likewise, wellness and wellbeing workshops and training, as mentioned in the previous point, can be worth providing.

• It is, of course, not always possible in terms of available budget, but do consider the alternative costs that you will incur as a result of losing employees and the costs associated with rehiring and retraining new staff.

Might it be far more affordable to release some funds for perks and benefits for existing employees to retain them?

5. Promote Work Relationships

If you are looking to hold some team-building sessions in-house, you can find some free team-building exercises here.

• Encourage social interactions and team-building activities. Strong relationships among coworkers often lead to higher job satisfaction and willingness to stay.

6. Give Recognition

Giving recognition can sometimes be as simple as saying thank you to an employee or simply congratulating them on doing a great job.

You can, of course, also provide bonuses and awards, but if doing so, just be sure that for every person you reward, you are not then alienating another person (i.e., the person who doesn’t get rewarded).

• Employees very often just need their efforts acknowledged, and most often it is about being a manager who understands how to have emotional intelligence in terms of how you deal with those you manage.

7. Retaining Remote and Hybrid Employees

It is also important to give focus and pay attention to supporting remote and hybrid workers, in terms of staff retention.

Consider checking in regularly, remembering to invite them into team conversations, and making sure they never feel excluded, including when it comes to training, development, and career opportunities.

To avoid remote and hybrid employees feeling excluded, make sure to:

• Have regular catch-ups
• Remember to also show them gratitude, just like you would in person, for good work.
• Vary meeting times if you have staff working in different time zones, so that remote staff are not always the ones needing to be in meetings at unusual hours.
• Offer team-building events that are hybrid and factor in cultural differences (see our post on tips for managing virtual teams)

It’s the human side- empathy, consistency, and visibility- that really make remote retention work.

8. Use Feedback Effectively

Used correctly, feedback is a powerful tool for helping to retain employees because good feedback:

• Helps employees better fulfill and manage their role
• Gives the employee an avenue to make you aware of any issues
• Provides staff with an opportunity to give you their creative ideas and suggestions (many of the best ideas come from staff who know your product and services the best)

You want feedback to be something that employees feel they can comfortably give to their manager, in addition to it being something that managers are skilled in using to provide guidance and support to those they manage.

• Effective Feedback Skills is something that you can train managers in, as this is a vital and valuable soft skill.

You might also consider using employee feedback software or apps, such as digital pulse surveys or anonymous suggestion tools.

These tools can make it easier to collect honest feedback and identify trends across departments or teams. Just be sure to act on what the data shows; feedback only builds trust if employees feel heard and see changes as a result.

9. Supportive Management

Being an empathetic leader and understanding how and when to listen to your employees is an essential skill.

A good manager should be able to nurture the talent and skills of those s/he manage and do so in an empathetic and supportive manner.

To be a good manager, you also need to ensure you work to build trust with employees, to create a sense of psychological safety and loyalty, as this, in turn, can help staff retention and team morale.

• If you are an HR Manager, consider providing active listening skills training to your managers and team leaders.

10. Hold Consistent One-on-One Meetings

Only by holding regular meetings with each employee you manage can you realistically have the opportunity to ensure that you find out about any issues the employee is having, anything they need, and how they are doing.

• Having a one-to-one meeting once a month is ideal, but even every 3 months or, if need be, once a year, is far better than never at all.
• Exit interviews are extremely useful because they help uncover root causes of employee dissatisfaction, allowing you to adjust policies proactively. These types of interviews are also sometimes known as Offboarding interviews.

Even better, consider holding what are referred to as Stay Interviews with existing employees before they even begin thinking about leaving.

These informal conversations are fantastic for uncovering concerns, career aspirations, and opportunities to improve employee retention, and very few organizations do so.

11. Watch Out for Burnout

As managers, we sometimes are so busy that we overlook the signs of burnout in an employee, and this can be avoided.

Keep an eye out for noticeable signs of employee burnout by being aware of any decrease in productivity and constantly missed deadlines, a big drop in the quality of the work, disengagement with other employees and social interactions, tiredness, increased absenteeism, and a loss of enthusiasm.

12. Clear Communication

When there is a lack of clear and good communication in a company, misinformation can so easily and quickly permeate the business.

This misinformation can be the cause of rumors (often untrue ones) and cause employees to be unsettled.

As a manager, you need to ensure that the following are communicated well:

• What do you expect of someone at work, and what are the goals?
• The company’s goals and strategy
• Clarify anything that comes up, such as rumors of potential job losses or a takeover.

Even when information is scarce (such as for a potential takeover), you can at least inform your team of what little you know to at least show that you are being transparent and will keep them informed at the first opportunity or any news or information.

Employees tend to trust you more as a manager or company when they feel that the communication channel is open and honest.

13. Give Employees More Autonomy

Feeling a lack of autonomy and authority is a common reason why employees start to look for other job opportunities externally.

• Try to empower your employees by showing them trust and also by helping them develop their confidence.
• One effective approach is job crafting, where employees reshape tasks to align better with their skills and interests.
• Another fantastic option to give employees more autonomy is to allow them to use a Heutagogy approach to workplace learning so that they are responsible for guiding their own learning and development.

14. Have a Good Onboarding Program

We already mentioned having exit interviews (offboarding) to learn about why the employee is leaving.

Equally important is the onboarding that you provide. It is shown that staff retention rates can be as much as 45% higher when a solid onboarding program is provided to new employees.

This onboarding will include ensuring that new staff:

• have a clear understanding of how to get started with their job role
• are introduced to key players they’ll need to know
• are given the correct training they’ll need
• and are brought up to speed on the company’s goals and strategy.

A good onboarding process helps staff retention because onboarding helps the employee to settle and feel more integrated into the company, and more quickly and more easily than without onboarding.

15. Promote a Sense of Purpose

When an employee understands how their role contributes to the team and the company, it is much easier for them to feel more committed and a valued member of the team.

• I suggest making sure that each employee you manage has a clear purpose and understanding of how they contribute to the team and why they are valued as a key member of the team.

Learn about how job crafting can help create a sense of purpose at work.

16. Provide Ongoing Training Opportunities

Employees need to develop and progress over time, and if their growth within the company and their role is stalled, expect them to begin seeking other opportunities outside of the company.

It is important to note that providing training to employees will not only aid their development and job satisfaction, but if the right training is provided, you as a company stand to benefit through having more highly skilled employees.

Employee Retention FAQs: Quick Answers

Can AI Help with Employee Retention?

AI can be a helpful tool in supporting employee retention strategies, particularly when used alongside good leadership and solid HR practices. For example, some HR teams now use AI to spot early signs of disengagement by analysing staff surveys or feedback.

It can also be used to recommend personalised learning and development plans, helping employees feel supported and valued in their roles. While AI isn’t a replacement for human insight, it can offer useful data that supports better decision-making and helps improve the overall employee experience.

Employee retention is one outcome of a positive employee experience. Improving communication, trust, onboarding, recognition, and wellbeing together creates a workplace where employees are more likely to stay.

Key Takeaways on Retaining Employees

I hope you found this post on how to retain employees useful and have some ideas on how to retain employees that you can use moving forward.

Retention doesn’t exist in a vacuum. It’s directly influenced by the overall employee experience, from onboarding and workplace culture to feedback and offboarding practices.

Consider tracking key employee experience metrics such as your employee retention rate and Employee Net Promoter Score (eNPS) to measure how well your employee experience efforts are supporting satisfaction, loyalty, and long-term retention.

I also want to draw your attention to the training materials that we offer that can be downloaded upon purchase and that include PowerPoint slides for teaching employees a range of topics that relate to employee retention, including:

• Employee Engagement training materials
• Building Trust
• Emotional Intelligence in the Workplace
• Learn more in our guides on employee experience management.