For small businesses, retaining your most productive employees is crucial to improving your business long-term and eliminates financial costs. For example, from the article What Was Management Thinking? The High Cost of Employee Turnover it states:
For entry-level employees, it costs between 30-50 percent of their annual salary to replace them.
For mid-level employees, it costs upwards of 150 percent of their annual salary to replace them.
For high-level or highly specialized employees, you’re looking at 400 percent of their annual salary.
That in itself is reason enough to hold on to your employees. Here are 5 ways you can retain your employees.
Hire Referrals - "Referred employees have a 45 percent retention rate after two years." Employees that were referred to a small business are likely to stay with the company than an employee you found from an outside source. There's a comfort level of working with someone you know and a higher level of trust about the company itself.
Foster Creativity - Employees like to have a say and put forth their own creativity in the workplace. Allowing your employees to be creative results in a very stimulating environment, some even consider taking less salary if they can have the opportunity to brainstorm and suggest new, fresh ideas that contribute to solutions and new products.
Provide Ongoing Training - Your best employees will get bored with routine and monotonous work. Offer ongoing training in new technologies and extra knowledge about your industry that they can apply to future work within your small business.
Encourage a Work-Life Balance Culture - Work-life balance is one of the most important factors when it comes to employee satisfaction. Having separation between work and personal time results in a better appreciation of their job and can even result in a better relationship with their manager or supervisor. "Remote workers are 50 percent less likely to quit." Allowing employees to work remotely from time to time is a powerful way to retain employees because they can work independently, at their own pace in a comfortable environment.
Give Rewards - This is probably one of the easiest ways a small business can retain employees and show them how much you respect and appreciate their professional efforts. These rewards don't have to be huge, even the smallest rewards such as a day off or a gift card to their favorite restaurant are appreciated by your employees.
Mindful Recruiting Solutions is dedicated to helping Small Manufacturers and Small Businesses because we understand the challenges of recruiting and hiring for a small business.