How To Reduce Employee Turnover Rate

Does your business suffer from a high employee turnover rate? There are both direct indirect costs associated with high turnover rates. Some of the direct costs include training programs for new employees, time and resources spent hiring new employees, and the cost for new equipment. Indirect costs may include gaps in production, reduced morale, reduced performance, etc. Allowing your business rate to suffer from a high employee turnover rate will only hinder your professional goals. Thankfully, there are some simple steps business owners can take to encourage longer tenure among employees.

Screen Potential Job Candidates

One of the biggest mistakes business owners make is hiring the first candidates who apply for the job. Even if they have all of the right credentials listed on their application, this doesn't necessarily mean they are fit for the job. And hiring candidates such as this without screening them beforehand could have disastrous consequences for your business. Some workers strictly want temporary jobs for a little side cash, so try to determine candidates' short and long-term goals.

So, how can business owners determine a candidate's goals? When you're interviewing a candidate (you should always interview candidates before hiring), ask them how long they plan to stay with the company if they are hired. A good answer to this question is "as long as possible," but you'll want to beware of candidates who say a couple months or even a year.

Show Appreciation To Employees

There are many factors that can drive employees to quit their current job and look for work elsewhere. The single most common reason why workers quit their job, however, is because of lack of recognition. Cutting your employees a check once every two weeks isn't enough; instead, you should implement some form of recognition program to show appreciation for everything they've done. You don't have to spend thousands of dollars on expensive gifts, but a simple recognition will go a long ways in reducing turnover rates.

An employee-of-the-month program is one example of an employee recognition program. Perhaps you could dedicate a wall in the office to employees of the month. There are dozens of companies that specialize in plaques, trophies and other gifts specifically for this reason.

Other Tips For Reducing Employee Turnover Rates:

• Allow employees room to grow and work their way up the professional ladder
• Keep employees involved in current and future changes within the company
• Make sure employees are given time off
• Maintain a positive attitude