High staff turnover can be a challenge for small businesses, impacting not only financial resources but also the depth of talent and knowledge within the organisation. When turnover rates are soaring, leaders must delve deeper into the root causes to address underlying issues
CREDIT: This is an edited version of an article that originally appeared on peoplepointHR
High staff turnover can be detrimental to small businesses – costs of recruitment, training and development are not only financial but also impact the depth of talent and knowledge within the organisation, ultimately affecting service quality and brand reputation. For those grappling with high turnover rates, leaders must delve deeper into the root causes.
When turnover rates are soaring, it’s crucial to embark on a fact-finding mission. Conduct exit interviews and surveys to glean insights into why employees are departing and engage in conversations with those who remain. The results might surprise you. Common catalysts for staff departures may include the following:
Comparison to other staff members
When employees perceive disparities between themselves and their colleagues based on factors beyond their influence, it can dampen their motivation and effectiveness. Inadequate equality and diversity policies can contribute to heightened staff turnover. Not having suitable equality and diversity policies in place can be a factor. If employees are disadvantaged due to for example gender, race or religion this is classed as discrimination in the workplace and is in breach of the Equal Pay Act 2010.
Unreasonable workload
Numerous studies have highlighted workload as a significant contributor to employee retention issues. When employees perceive their workload as overwhelming and insurmountable within the allotted time, it often leads to heightened job dissatisfaction and, consequently, elevated staff turnover rates for employers.
Lack of career opportunities
Motivated employees often harbour aspirations for growth and development within an environment conducive to their career goals. In cases where their current company fails to provide avenues for advancement or career progression, the enthusiasm for remaining diminishes gradually. This can exacerbate high staff turnover rates, particularly among ambitious employees, as they seek opportunities elsewhere that promise greater prospects for professional growth.
Not being recognised and rewarded for work
Few things are as disheartening as pouring your effort into a project only to have someone else take credit for your work. Recognition from our superiors—a simple pat on the back or a well-deserved acknowledgment—is a fundamental need for all of us.
Bad line management
The consequences of poor line management are clear: it can greatly exacerbate high staff turnover rates and negatively impact the business. When employees feel disempowered to voice concerns or fear negative consequences for addressing problematic team dynamics, the effects can be profound.
How can small businesses decrease high turnover rates and improve staff retention using retention strategies?
Promoting equality
It’s crucial to ensure that all employees are treated with equality and fairness. Inequality and a lack of diversity in the workplace not only limit the potential of you and your team but also expose your business to significant risks, including discrimination claims that can damage your reputation and incur tribunal costs.
Managing workflow and workload
Every employee and team should have a workload that is fair, achievable, and aligned with their job descriptions. Effectively managing workload not only reduces average absence costs but also contributes to lowering staff turnover rates.
Provide opportunities for growth
Offering development and growth opportunities serves as a powerful incentive for staff members, motivating them to enhance their job performance. Ensuring that these opportunities are available internally can aid in retaining ambitious employees who seek career progression and personal development. When individuals feel they are gaining more than just monetary compensation from their employment, they become more engaged and motivated.
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