Employee Turnover: The Most Common Myths and Misconceptions

Most businesses think about employee turnover only after it becomes a problem.

Surveys report that as economic conditions continue to recover from the Great Recession more disengaged employees may seek to change jobs over the next year.

The Hay Group consultants say average employee turnover rates over may rise above 20 percent over the next five years.

Further, employees who receive enticing job offers say increasingly that they would accept them.

Employee turnover misconceptions

1. All Turnover is Bad

In fact, turnover can be harmful as when skillful, hard-working team players leave or helpful as when troublesome misfits move on and brighten their former coworkers' day on their way out.

2. Employees Usually Quit for More Money

Although some job changers leave for more pay, salary or hourly rate is not necessarily the best indicator of employee willingness to jump ship. Often more reliable predictors are their relationships with managers or supervisors, promotion opportunities, or inability to learn new job skills or to deal with stresses. As often as not, the motivation to change jobs is something other than money.

3. Managers Cannot Decrease Turnover

Some business managers believe high turnover is an inevitable fact of life in their sectors, but the fact remains that some businesses in the same sectors have much lower turnover ratios than have others. Many if not most employees leave voluntarily because of unpleasant relationships with their supervisors or managers. Leadership and the culture it creates can retain employees or repulse them.

4. Numbers Are Not Important

Turnover rates must be considered in their contexts. Industry and geography can contribute to turnover ratios. A 30-percent fast-food or retail turnover rate in San Diego may be outstanding. A 10-percent aeronautical company rate in Seattle may be high. Turnover can be complex, and the reasons for it are significant for business planning purposes.

5. Turnover Does Not Affect Profits

Some business managers believe because turnover is inevitable they just have to learn to live with it as best they can. Generally, however, the lower the turnover rate, the more profitable is the business because long-term employee retention can build profitable relationships with customers. Conversely, popular employees also can draw customers with them away from the business when they leave.

Data from employee engagement opinion surveys consistently indicate job aspects that matter more to employees than how much they earn:

• Good working relationships with supervisors
• Opportunities to learn and grow
• Meaningful work
• Respect and appreciation
• Recognition for contributions
• Autonomy and authority
• Flexibility in time and attendance

Tips to attract and retain productive employees

No doubt employers must pay fair market wages to attract and retain productive employees. Beyond pay, which managers typically do not control, many other variables are within their domain, so they may do well to consider certain suggestions:

1. Hire Wisely

Interview applicants with care not only for the right skills but also for cultural fits with team and organization. For best results, several people should interview applicants, preferably the same day, for multiple impressions of their prospects for success.

2. Put Employees First

Managers should recognize subordinates as unique contributors by offering some flexibly in schedules and allowing telecommutes, which can be productive and profitable timesavers, whenever appropriate. A bonus or compensatory time off as a reward for extra effort on extensive projects always builds morale. Managers should have daily contact with their team members as visible, accessible, and approachable.

3. Keep Employees Informed

Employees never complain about receiving too much information, so managers should talk often about what's going well and about the organization's goals and challenges. Communications can be by e-mails, formal and informal meetings, and one-on-one conversations.

4. Training Opportunities

When business managers provide employee training, the organization gets personnel more knowledgeable and efficient with better chances for advancements and promotions. Fewer feelings of stagnation and frustration make the workforce more engaged. Investment in training employees signals investment in their future in the organization.

5. More Leadership and Less Management

If, as some analysts say, employee trust in management is at an all-time low, managers can help rebuild it by being open to creative employee initiatives for improvements, by careful consideration of employee input about how to do the job better, handle customer complaints, or maximize efficiencies. Look for opportunities to recognize and praise efforts that add to team and organization success.

6. Make Retention a Company Commitment

Employee retention is important to team and organization success. Managers should ask disengaged employees what they like and dislike about their jobs and what they would change. Changes based on what they say are always good morale builders.

7. Compensation and Benefits

Top management at least annually should review compensation and benefit plans for competitiveness and adequacy for employee needs. The review should be of not only base and variable compensation but also long-term incentives and health and wellness benefits.

8. Employee Opinion Survey

Management needs to be aware of employee opinions on what works and what does not by getting a current picture of employee engagement and acting to address concerns. This proactive approach may prevent loss of the most talented in the organization.

Real-time company climate data with Clarity Wave software

Clarity Wave surveys give business managers a real-time picture of company climate and of staff happiness levels by developing in employees a willingness to answer weekly, seven-question, micro-surveys.

By keeping the surveys short, closed-ended, and frequent and by awarding prizes for regular participation, the program outreach has been as high as 73 percent of all employees.

This high frequency of highly reliable, first-hand information helps business managers take timely, effective action to remedy identified disengagement problems.