Three Drivers To Improve Employee Retention

Steven Cesare, Ph.D.

A business owner from Oregon called me the day to talk about staffing issues.  The astute owner, well-read and highly energetic, immediately accepted my premise that staffing is a composite of multiple factors, most notably recruitment and retention.  Accordingly, it is imperative that business owners re-orient their focus onto retention first and stop reflexively and blindly fixating only on recruitment.  

Recruitment is critical.  We all agree.  Oh, by the way, oxygen is important too.  

By way of hypothesis, recruitment issues could be solved if you could overpay the going labor rate by $8.00 per hour.  Right?  Of course, I understand the extreme nature of that position; the point is that an answer to that problem is available.  The labor force is obtainable; prospective employees are out there.  Hire a full-time recruiter, dramatically increase the Employee Referral Bonus (currently $850 per Maintenance Foreman), establish recruitment goals by department, strategically design and maintain a bi-lingual social media campaign aimed at acquiring new employees, revisit the 6 Bs of staffing, attend more community events, schedule more open-house events, consider signing bonuses, partner with local agencies and businesses, advertise using Hispanic radio stations and newspapers, and most of all, be on the ground recruiting every day.  As just presented:  There is an obvious path to recruitment success.

Instead of addressing attention exclusively on recruitment, recast awareness onto retention.  Companies would not have to spend as much time, money, and worry on recruitment if their employees did not leave in the first place.   Asked rhetorically, why are we emphasizing bringing in new employees through the front door, when current employees are leaving us out the back door?  Let’s keep what we have, build around it; instead of continually churning new employees into the system all the time.  Is that too much to ask?

Assuming a level playing field (e.g., economic conditions, geographical location, customer base), there are three primary underutilized drivers of employee retention that most business owners refuse to consider because they are too busy moaning about recruitment woes.

  1. Trustworthy Management.  Employee retention rates will remain high if employees believe the company management team is ethical, moral, and truthful.  Are ethics, morality, and truth too much to ask?  Employees, especially high-caliber employees, are not dumb.  They want honesty from their leaders; they view their leaders as role models of virtue, success, and honor.  Accordingly, management should have monthly all-hands meetings with the workforce, tell the truth to them at all times, answer their questions, and always do follow-up on their commitments.
  2. Development Plan.  Employee retention rates will remain high if employees believe the company is investing in their career progress.  Aren’t ”Our Employees are Our Greatest Asset.”  To that end, beginning with the job posting, supported by the website, continuing through the interview process, and taking shape during New Employee Orientation, inform the employees of your investment in them:  safety training, OSHA 10-hour certification, equipment training, position training programs (e.g., Laborer, Foreman, Supervisor), customer service, CPR, team building, ESL, chemical handling, etc.  Show the Career Ladder to them during their first interview!  Is it too much to ask to show our employees that we have a plan in place to help them improve themselves, their families, and their future? 
  3. Employee Engagement.  Employee retention rates will remain high if employees have a sincere connection to management, their co-workers, and the company.  The origin of this connection must be emotional; employees must know that the company actually cares about them as people.  They are not workers; first and foremost, they are people.  Is that too much to ask?  Know their names, talk with them, smile, walk their jobs, shake their hands, look them in the eye when you hand their pay checks to them, say “thank you,” compliment them on meeting a performance expectation, and let them know you really care about them.  If not, you’ll be spending a lot more time doing employee recruitment.

Is that too much to ask?

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Steve Cesare Ph.D.

has more than 25 years of Human Resources experience. Prior to joining The Harvest Group, Steve worked with Bemus Landscape, Jack in the Box, the County of San Diego, Citicorp, and NASA. Steve earned his Ph.D. in Industrial/Organizational Psychology from Old Dominion University, and has authored 68 human resources journal articles. As a member of The Harvest Group, Steve’s areas of expertise include: staffing, legal compliance, wage and hour issues, training, and employee safety.  Read Steve's full bio.