Employee turnover reflects the number of staff leaving a company in a given time period typically over one year. It is usually expressed as a percentage of the company’s overall headcount.
Employee turnover is not always a bad thing. It can be a way to remove ineffective employees and replace them with effective ones. However, employee turnover has significant associated financial costs relating to advertising costs, corporate recruiter time, empty desk time, additional training and learning time before a new recruit reaches optimum performance.
Employee turnover is has company wide causes, but there are several steps that a corporate recruiter can take to minimise employee turnover in their business.
1. Understand the relative turnover trends
One of the first areas to look at in a retention strategy is employee turnover trends. Turnover can vary dramatically according to profession, industry, region and size of company. The corporate recruiter should analyse and understand the risks and trends associated with the departments or roles they recruit for.
2. Understand why people are leaving
The corporate recruiter should ideally perform exit interviews on all leavers, particularly those who leave prematurely as there is an increased likelihood that this could be linked to recruitment practices. It is likely that this research will identify a multitude of reasons for leaving some of which will be as a result of actions and decisions which occurred during the recruitment process.
3. Clearly set job expectations
The Taylor and Francis Group’s recent employee retention study identified that giving employee’s ‘Realistic Job Previews’ can play a part in improving staff retention. This helps ensure that employee’s expectations are not artificially raised at the recruitment stage. To do this, the corporate recruiter should work closely with department heads and jobholders to develop an accurate and detailed job description and person specification which is well written and easy to read.
4. Clearly communicate terms and conditions
Pay and benefits can be a contentious area and if employees receive less than they thought they would, based on their recruitment discussions, they may become dissatisfied, and this could contribute to them leaving. Once again, corporate recruiters should ensure that employees are provided with an employment contract and collateral which explains how benefits and bonuses work. They should be given enough time to review these and should be encouraged to ask questions in order to clarify any areas that they are unsure of
5. Educate them on the company culture so they know what to expect.
Provide an office tour at some stage of the recruitment process, enabling them to meet and engage with their immediate team and staff in general. This will enable them to form a more realistic impression of the company culture and working environment.
6. Use high quality assessment methods
Another key reason for employee turnover is the employee’s lacking the appropriate job skills. If a significant proportion of employees are terminated due to lack of competency or aptitude, it is possible that this could be addressed in some part during the recruitment process.
Corporate Recruiters should therefore employ the highest quality assessment methods to verify the employee’s skills and aptitude. The most effective method of selection is Structured Interviewing. Behavioural based questioning is widely considered to be the most effective questioning technique. Where appropriate, use attainment tests to actually verify the knowledge of your job candidates. You can also consider aptitude tests to assess the employee’s ability to adapt and learn new things. In some situations where behaviour is key to the role, it may be worth using personality assessments which can help to predict a candidate’s behaviour in specific situations and environments.
7. Use a formal induction and orientation programme
It is generally understood that a formal induction and orientation programme can improve employee retention, particularly in the case of premature departures in the first three months or so. This is because the first days, weeks and months are critical as the employee is forming their opinions and impressions of the business. If the employee feels lost, confused and uncared for during the probationary period they may be dissatisfied. Having not yet built up the ties and connections with the business, they tend to be a greater risk of resignation.
8. Encourage department managers to set-up a formal training program
New staff can quickly become disheartened if they do not know what to do and exactly how to do it. Staff training can easily be overlooked when a department has been understaffed for a while and the employee can be dropped into the deep end, when they are not yet able to swim. Corporate recruiters should work with line managers to help them realise how important a good initial training program is to staff performance and retention.