12 Strategies to Reduce Employee Turnover

When a valuable team member leaves a company, it can have a negative impact on the budget, management’s workload, and staff satisfaction. TITANS offers preventive practices to reduce the likelihood that the turnover risk will cause problems for your company.

Poor corporate culture, staff overload, low salaries, and poor employee benefits. These are just some of the many causes of workforce turnover in companies. It can be either voluntary (if people left by choice) or involuntary (if they were laid off by the company).

Although a certain degree of turnover is natural and inevitable, if it becomes excessive, changes need to be made in the company. The impact of the departure of a valuable employee is felt by the company long after their last day and far beyond the boundaries of their department.

Consequences of turnover

Employees often decide to change employers when their company does not offer sufficient opportunities for career development, the option of working from home, or clear business goals. Moreover, people working in the IT sector are five times more likely to suffer from poor mental health than the rest of the population. Demanding projects combined with long working hours contribute to an imbalance between work and private life. Up to 52% of them suffer from stress, anxiety, and depression at work. Some studies suggest that 2 in 5 people working in technology may experience burnout.  

However, the impact of interpersonal relationships should not be underestimated. The most common reasons why employees leave their jobs are poor company management and dissatisfaction with their manager or supervisor. Overall, most voluntary departures are caused by a toxic work environment. Although it may not seem so at first glance, this is good news because recruiting and training high-quality management is something that companies can influence. 

And they should strive to do so. Although the costs incurred by a company when an employee leaves vary depending on their salary and role, some studies estimate that finding a replacement costs between six and nine months of their average salary. Other sources indicate that for an employee in a technical position, the costs can reach 100 to 150% of their annual salary. And for someone in a management position, you can expect to pay up to 213% of their salary. This is because the company has to pay for (among other things) advertising, interviews, selecting and hiring a new person, the onboarding process, training, and management’s time. 

“Recruiting the right talent can take anywhere from one to four months, depending on the complexity of the position,” says Chris Estrada, CEO of Nationwide United Auto Transport. “The delay, combined with the costs, places a huge burden on the remaining team members, who have to take on additional responsibilities.”  

The rest of the department feels more stressed and cannot perform at their best. However, more than half of the IT talent surveyed feel uncomfortable discussing their mental health issues with their superiors. This loss of productivity costs US companies $1.8 trillion every year, not to mention the risk of further turnover when the remaining employees are overworked.  

Once a company finds the right person, it should keep in mind that they will need more time to complete their work at the beginning. It may take one to two years for them to become as productive as the rest of the team — and that will result in indirect costs for the organisation.  

Furthermore, if staff witness high turnover, their level of engagement and productivity will decrease. Half of the respondents said that having a best friend at work creates a stronger bond with the organisation. They often ask why their former colleagues left. Since up to 70% of them said that having a friend at work is the most important factor for their job satisfaction, it makes sense that even one person leaving can seriously affect team morale and loyalty to the brand. 

How to reduce turnover

A survey by Yerbo found that 42% of IT professionals who experience high levels of burnout are considering leaving their company within the next six months. However, if a company embraces the four pillars of a positive workplace culture—trust, support, collaboration, and fairness—it will gain strong teams, open communication, and supportive leaders.

However, sharing is also a key attribute, suggesting that management should listen more than they talk during conversations with their subordinates. They should be attentive and responsible to their team and act with determination when addressing systemic challenges in the workplace. Chris Niems, Head of HR at One Rewards, says that workforce expectations have risen in recent years: “The most effective retention strategies are not reactive, but proactive investments in relationships and culture.”

At TITANS, we have put together 12 practical recommendations to reduce turnover in your company.

1. Emphasise cultural compatibility when recruiting.

Use personality tests, game-based assessments, situational judgment tests, or work sample tests to identify soft skills such as effective communication and harmonious collaboration.

2. Get off on the right foot with new employees.

A well-prepared onboarding programme increases productivity while improving job satisfaction. Up to 76% of respondents expect introductory training during their first week on the job. If it is insufficient, it becomes the fourth most common reason for early departure from companies.

3. Invest in the present and future of your employees.

In addition to competitive salaries, you can offer different benefits to different groups of your staff — for example, young employees, those who are starting or planning to start a family, and colleagues who are approaching retirement age.

4. Teach management practical skills.

Strengthen their communication skills, teach them to trust their teams and give them more autonomy, and train them to recognise their own biases and microaggressions.

5. Make goal tracking a daily event.

Effective goal tracking tools include positive reinforcement, reminders, and gamification features designed to keep staff on track. It is also recommended to provide employees with opportunities for personal and professional growth, such as personalised learning paths, mentoring programmes, cross-departmental projects, and external training and certification programmes. Up to 94% of IT professionals consider professional development opportunities to be the best benefit.

6. Show them how much you value them.

Show your employees your gratitude, for example, by introducing a formal recognition programme or organising a small impromptu celebration.

7. Give people more flexibility.

You can offer them the option to work from home, flexible start and end times, or a four-day work week. More than half of tech startups say that remote work helps them attract the best talent, and up to 60% of IT employees who work from home say they are more likely to stay with their current company.

8. Prevent burnout and stress.

Up to 84% of office workers work overtime every week, and 68% of people work on weekends. Despite this, only 36% are paid for overtime. Here, too, it is helpful to train management to recognise the signs of stress and burnout, reward those who prioritise their health, and promote transparency. This will allow teams to share their feelings without fear of negative consequences.

9. Give meaning to monotonous tasks.

Help the team find opportunities to learn new skills in boring tasks, or motivate them to reward themselves with a short, fun break after completing them.

10. Ask employees how they feel and listen carefully to their answers.

Active listening means reading their body language, asking for clarification if necessary, and approaching the conversation with an open mind rather than immediately reacting defensively. Validate their feelings and give their thoughts and opinions the respect they deserve.

11. Introduce fair wages.

The company pays much more for hiring and training a new employee. It is worth keeping in mind that 23% of respondents would change employers for a 10% wage increase.

12. Hire external help.

Up to 70% of employees feel that they are overloaded with work that they cannot complete within the set deadlines. If you notice this among your IT employees, it is a good idea to ask them if they feel that more is expected of them than they are capable of doing, for example, in the form of an anonymous questionnaire. If your concerns are confirmed, it is time to hire new staff or at least start delegating work to external IT specialists. If IT freelancers take on part of the workload, internal teams can once again focus on their core competencies, which they do best.

How can you prevent turnover?

Not sure whether it’s better for you to hire a new employee or a freelancer from TITANS? You should consider the fact that hiring processes for developer positions are extremely time-consuming, especially for startups with limited resources and stressful deadlines. Up to 68% of companies need at least one month to recruit a programmer.

And since an average of 20% of new hires need to be replaced after being hired, outsourcing these roles can significantly save your budget, speed up time to market, and reduce the risk of additional costs and delays. As the market tends to be unpredictable, many companies also appreciate being able to change the size of their teams depending on current needs. One example is Google, which uses the outsourcing of top IT talent to replace internal staff when they go on parental leave.

Are you interested in the outsourcing strategy chosen by brands such as WhatsApp, Google, Slack, and Skype? If you would also like to increase your brand’s efficiency, innovation, and growth, you can find all the useful information about hiring IT experts on our website.