Get employee engagement right to improve retention

There’s a reason why doing what you love takes very little effort: it comes naturally, and when things get difficult, you relish the challenge rather than slough through the motions. Nowhere is this more true than at work. Getting people engaged in what they’re doing—helping them find love for what they do, day in and day out—is the best way to keep great employees around. But while this idea seems simple enough in theory, great employee engagement takes planning and hard work.

A survey in 2020 found that only a third of employees plan to stay in their current jobs—a massive dip from nearly 50 percent the year prior, which has some human resources departments scratching their heads. Is employee retention doomed? Have engaged employees vanished into thin air? Thankfully, no. The truth is that the traditional full-time work environment is changing in unprecedented ways. In this turbulent job market, Millennials and Gen Zers are putting themselves first, even if it means leaving a job.

However, that hasn’t stopped a number of businesses from blaming employee turnover on the very people they depend on. They mistakenly assume that providing a job is all there is to employee experience. In reality, the businesses that keep their best employees happy and engaged spend more time and money investing in their people—not just with salaries, but with incentives and carefully planned employee development programs.

How Culture Drives Employee Engagement

When thinking back on your favorite job, what did you love most about it? The job duties? The campus? The people you worked with? The company’s values? For most of us, it’s when those aspects combine into a feeling of appreciation for a job well done. Job satisfaction depends on your fit within a strong company culture where people matter and employee recognition is abundant.

It’s not rocket science. People who feel like they matter tend to stick around longer.

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That’s why when the labor shortage made headlines in 2021, some job seekers found the term misleading. Sure, companies couldn’t find workers, but not because of a shortage. The pool of unemployment was as big as ever—plenty of people needed work—but they weren’t interested in working for companies that didn’t go the extra mile for their employees.

Even a small investment in employee retention can have immediate returns. By offering meaningful work and competitive wages, you’ll have the best chance at higher employee retention and engagement.

The 3 Things Employees Need

The reality is that most people don’t wake up excited to go to work every day. Choosing to spend time at work is a sacrifice, and in order to reduce absenteeism, employees need a few guarantees in return. The SHRM calls these needs “inducements”, and they include the following:

  • Satisfactory pay.
  • Good working conditions and work-life balance.
  • Developmental opportunities.

If your company’s bottom line hasn’t made room for these initiatives and you’re serious about retaining top talent, it’s time for a change.

Pizza Parties Don’t Buy Employee Retention, money does

Let’s address the elephant in the room: competitive pay. Yes, there are rare employees out there who accept sub-industry standard wages while putting out amazing work, but they are few and far between. The vast majority of employees have a hard time focusing on work when distracted by how to cover the cost of living.

The well-being of your employees depends on adequate compensation. Does that mean higher costs and less profitability? Let’s answer that question with another question: If the average cost of replacing an employee sits around $15,000 (as Gallup says), do you actually save money by paying employees subpar wages?

Fortunately, there are plenty of other ways to offer compensation and reduce high turnover without drastically increasing spending.

  • Offer more PTO.
  • Reimburse child care expenses.
  • Let employees work from home wherever possible.
  • Consolidate your workforce to prioritize your highest performers.

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And don’t forget about inflation. Raises, bonuses, and cost of living adjustments aren’t just good business sense—they help employees feel valued at work.

A Job (and culture) They Can Love

Company culture is a funny thing. Some think it comes from office décor, a few cute signs on the wall, and a glamorous onboarding process. These things can help. However, in reality, a safe constructive working environment has less to do with what people see and more with how they feel. Employee satisfaction is highest when people feel that their commitment to the company is reciprocated; where their respect for the goals and vision of their employer is met with understanding about what it means to come into work every day. In short, good working conditions depend on treating employees like human beings.

Of the three SHRM inducements listed above, good working conditions might be the hardest to achieve. Why? Because unlike pay and ongoing career development, making work a nice place to be requires a realistic and mature approach.

Start with open communication. Listening to employees and—more importantly—responding to them helps them feel like equals, which is huge for preventing the gridlock of an us vs. them mentality. Yes, team-building activities help, but nothing reinforces your company’s values like hearing the latest news straight from the horse’s mouth. And this is especially true when it’s something employees may not want to hear.

Wait – you want me to willingly give employees bad news? Won’t they all quit?

Transparency is key

You’re not doing any favors for people by keeping bad news a secret; nothing hinders job satisfaction like being kept in the dark, which is why an important part of company culture is transparency and communication. There’s a tactic in sales writing called a damaging admissions where brands openly address a weakness early on. It is highly effective at creating trust and goodwill with customers. Why? Because while you might think admitting fault would harm brand confidence, the opposite is true.

In his book Transparency, Warren Bennis even finds that this strategy works well between employers and their staff. He mentions a study saying, “twenty-seven U.S. firms that appeared among the thirty-four most transparent companies beat the S&P 500 by 11.3 percent.” So, if you think of your company as an investment, transparency offers returns better.

For employees, transparency is the top indicator of job satisfaction. Best of all though? It costs nothing. This doesn’t mean HR professionals should publish weekly newsletters about the mistakes made by their company, but you can relax any notion that openness will sour your reputation to the point of an uprising. The more honest you are with them, the better they will perform.

Keep Progress Moving Upward

Now that we’ve covered competitive pay and a good work environment, the next thing on the list is to create career paths for the people spending their lives building your business. This is important because stagnancy is a slow burn. The longer a person stays in the same role, the easier it is to get bored and start shopping around for new job opportunities. For your rock star employees, the process begins even sooner.

So what can your company do about it? Provide career momentum that offers direction, advancement, and recognition. Give your employees a purpose.

Right away, some challenges appear. It’s not easy to discover someone’s aptitude, nor is it easy to develop their skills. Some new employees just aren’t cut out for management, which means launching their healthy career can take some creativity, especially if it is to be aligned with your company’s success.

Start by helping new hires determine their career goals with your company. Some will have answers ready to go, though not everyone. For those wandering minds, have suggestions handy to jog their imagination and help them envision a prosperous future. Keep in mind also that while some aren’t looking for career advancement, that shouldn’t deter you from giving them a direction to go. Even better, consider advancement opportunities that don’t involve going into management. An associate engineer might advance to an engineer, and then a senior engineer by taking on more responsibility and harder projects, but not direct reports.

Additionally, when it comes to learning new things, mentoring stands alone as a developmental opportunity. By having your veterans show rookies the ropes, you not only give them the chance to learn new things, but also to develop important workplace relationships—connections worth far more than any HR-inspired program. In fact, with the exception of management transparency, workplace relationships are the most important traits of employee retention.

Making the Most of Onboarding through Mentoring

The more integrated employees are with their coworkers, the better your chances will be of keeping them engaged and motivated. Yes, friendships may also materialize from mentorships, but the most valuable outcomes are the new or improved skills that keep employees engaged.

As mentioned earlier, today’s jobs just don’t offer the same assurance of longevity as those during past generations, making it important to provide transferable skills that people can carry throughout their careers—that is, if your workplace is to be an opportunity rather than just a job.

A good mentor won’t just provide insights about developing the right skills; they’ll also provide a story about what progress looks like in your company. Sharing history sets realistic expectations for new hires while giving tenured employees more optimism about their own professional development. It’s a win-win for everyone.

Don’t forget to occasionally form groups, like employee resource groups, for your new hires. Whether it’s with other newbies or just random arrangements, you’d be surprised by the results that come from mixing new faces in with older team members. Sometimes, those unexpected friendships pay far higher dividends than any of the tried and true employee retention strategies.

Revisit Retention & Engagement Regularly

Hopefully this blog has given you a few ideas about how to improve your workplace, but you still need to do your homework if you want the best results. Ask questions about turnover. If it’s on the rise, look into what departing employees share in common. Do they leave during a certain time of year? Are most of them from a certain department? Is one gender more affected than another? Asking these questions can help you determine whether or not your company has a management or culture problem, or if it’s something else entirely.

More often than not, the answer is right in front of you. Send out employee surveys asking for real, direct, honest feedback, and ensure they feel safe by keeping submissions anonymous. If there’s a pattern, you can use your data to target specific areas and try new solutions.

And when was the last time you updated your benefits package? Would you say it’s competitive for today’s job market? If your employees have to cover their own healthcare, that cuts into their take-home pay, leaving the door open for other job opportunities. Compensation goes hand in hand with recognition, so be generous wherever you can.

Finally, remember to recognize your employees in genuine ways. At the end of the day, nothing feels better than knowing you’re doing a great job. The more opportunities you provide for that happen, the happier your employees will be.

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