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How To Build An Effective Retention Strategy

Millennials continue to contribute to higher turnover rates, but can you create loyalty?

4Jan

Even though millennials have proven themselves to be as hardworking as previous generations, it's undeniable that they have a different vision when it comes to careers. According to a study published by Project: Time Off, millennials are more likely to say that they are 'obsessed with work', and they are less likely to take the time off - based on feeling guilt when using their paid time off and a fear of others thinking that they are replaceable.

For years it was considered bad for a resumé if an individual changed their job more than three times in a decade, but that is no longer the case. According to the Bureau of Labor Statistics, employees aged 25-34 spend an average of 2.8 years with one employer, compared to 7.9 years among workers aged 45-54. So if millennials are dedicated workers, why don't they climb the career ladder by staying loyal to one company?

Millennials tend to stay away from positions with repetitive environments and many prefer part-time or flexible roles over permanent. Some companies have managed to adapt and embraced the change, but the model doesn't work for all industries. Today, turnover rate is the main indicator of corporate health, and it's the leadership teams who need to put more effort into targeting employee loyalty.

Among the reasons why so many people are switching between jobs, is the variety of freelancing opportunities and an increasing popularity in entrepreneurship. The ability to be in charge of time and productivity is a key element of this growth, but it's still possible to give people this freedom in a corporate environment without seeing your employees leave.

If employees are visibly interested in entrepreneurship or feel that they have more to offer elsewhere, as an employer it's worth listening to these desires and needs. Instead of restricting side interests and being negative about the rise of the gig economy, think about how these can be mutually beneficial through intrapreneurship. Whether it's a hunger for executing new creative strategies or even startup ideas, if a leader shows genuine interest and willingness to contribute to employee's personal and career growth, there is every chance that an individual will reconsider their decision to leave.

Ineffective retention strategies can negatively affect all business units and execution of critical business goals. Turnover rates must be reviewed systematically - not only recorded but analyzed and thoroughly discussed throughout all areas of the company. The analysis should look at both long and short-term elements which allows companies to trace patterns and identify potential problems.

High turnover rates can be caused by several factors - external, internal, and personal, each of which should be investigated and controlled where possible. Exit interviews are essential to this they provide identifiable reasons for leaving, rather than just adding a number to the turnover rate. However, the insight that comes from these interviews needs to be recorded and acted upon, rather than just noted and ignored.

Retention initiatives are a much easier and cost-effective solution to a recruitment strategy, so the more leadership teams can gauge employee happiness, the more chance a company has to keep their turnover rates low.

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