Employee retention is crucial to maintaining organizational performance. The ever-changing landscape of employee needs can be challenging to keep up with, so it's essential to understand the employee retention strategies most likely to address the issues your employees face in the workplace. Without taking the time to learn why employees are dissatisfied, your retention efforts could fall flat and leave you facing the business costs of employee burnout. 

To meet these expectations, companies will need to recognize the importance of investing in mental health and readjust their ideas about the benefits that are most likely to improve employee retention. With this in mind, we've gathered effective employee retention strategies to help you keep your best talent and reduce organizational costs.

Employees Are Willing to Leave Without Having a New Role

When it comes to leaving an unsatisfactory job, employees aren't willing to wait. A recent survey of over 2,000 people revealed startling facts about how and why employees quit. Of employees who had recently quit their jobs, 68% did so without having another job lined up. These employees were willing to use side jobs and dip into emergency savings while they searched for a better opportunity. When respondents were asked why they quit, the number one reason was a toxic culture. 

Our study conducted by Modern Health and Forrester revealed that employees now more than ever are willing to stay at a company (or leave) based on the quality of their mental well-being benefits. When surveyed, 73% of employees and 81% of managers indicated they would be more likely to stay at a company that offered high-quality resources to care for their mental health. This indicates that employee well-being is centered around mental health, and employees are willing to switch jobs to defend their needs.

Impacts of High Turnover

Employee turnover is the rate at which employees leave their jobs and are replaced by new employees. When companies experience high employee turnover, the organization is affected in many ways. High turnover can impact productivity and morale, resulting in additional business costs.

The most common impacts of high turnover include:

• Financial Impacts: It's estimated that it costs an employer an average of 6 to 9 months' salary to replace an employee who leaves. Recruitment, hiring, onboarding, and training make up a significant part of these costs. Yet, they fail to include the financial impact of the employee who left. The costs of losing a fully trained employee include the loss of company knowledge, money spent on training, and the potential income the employee could have gained for the company in the future.
• Lower Employee Morale: High turnover has a negative impact on morale of the employees who remain with the company. When employees leave within a short period, the remaining team is often left responsible for a heavier workload. Additionally, the loss of familiar employees means the loss of friends and a potential reduction in effective collaboration. Such impacts can lead to increased stress and lower morale.
• Fractured Company Culture: A healthy company culture comes from a sense of belonging. High turnover can impact belonging as new employees mean a constantly changing culture. When employees leave, team dynamics change and other employees consider why they should leave the company too.
• Diminished Customer Experience and Satisfaction: Long-term employees bring company knowledge and a wealth of experience serving customers in their role. New employees with less experience can be less effective when it comes to meeting the needs of customers. When this occurs frequently, customers are more likely to go elsewhere.

First, Understand Why Employees Are Leaving

All too often, when companies experience high turnover, employers fail to understand the reason why employees leave. As a result, proposed solutions fail to improve the situation. Before implementing changes, it's advisable to devise a process to understand the root of the issues causing employees to leave. This can be accomplished through exit interviews that ask poignant questions about their experience as an employee. The interview should include questions about the employee experience, how they experience and view leadership, how they felt about the benefits offered, what they think about advancement, etc. The responses to such questions can provide valuable insight into the benefits that can improve employee retention in the future.

Then, Define & Create Strategies to Retain your Employees

High turnover is a direct result of work dissatisfaction. The data from your exit surveys can help you clearly understand why your employees are leaving and provide a valuable resource for improving employee retention strategies. Begin with an honest introspection of how employee needs are met within your organization and research cost-effective ways to meet those needs. These popular retention strategies address many of the pain points experienced by employees.

Establish or Enhance Wellness and Mental Health Programs

The definitions of wellness and mental health programs can be vague and fail to offer the services your employees need. Helping your employees stay fit mentally, financially, and physically and avoid burnout is great, but what does it mean? Create a specific program that offers valuable benefits beyond rec rooms and happy hours. Modern employees need care beyond the surface level to enhance physical and mental health. 

Prioritize the well-being of your staff, including mental well-being, by working towards destigmatizing mental health in the workplace. Examine your mental health care coverage. What is included, and what's missing? Is it supporting the well-being of your employees? Consider mental health benefits from a standpoint that recognizes well-being is affected by more than workloads and direct job stress. Employees bring their whole selves to work, including stressors from being a parent or caring for an elderly or sick loved one. Consider how dependent care coverage (daycare), caretaker stipends, flexible work hours, and maternity and paternity policies can work to reduce such stresses for employees. Cultivate a sense of belonging and psychological safety in the workplace with benefits, communications, policies, and culturally centered care that supports acceptance of people from all backgrounds, races, and cultures.

Boost Employee Engagement by Giving them a Reason

Engagement isn't just about how productive an employee is. It's about your employee's investment in being present and invested in the organization's vision. Engagement isn't a one-sided responsibility of employees. It's about building reciprocity through policies, communication, and a feeling that employees receive the same return and acknowledgments for their investment. 

For employees to be engaged, they need to know their ideas and opinions matter. An engaging workplace culture allows employees to dissent. It provides employees with an environment that encourages them to be curious, take risks, and express their ideas and views without negative consequences. Creating a feedback culture can help employees feel heard and valued. One way to do this is by giving feedback that focuses on growth rather than just advice on how an employee can improve. This type of feedback can help to motivate and encourage employees, as it shows that you are invested in their development. Completing the feedback loop by accepting employee feedback through pulse surveys is also important. This will give you a better understanding of employees' engagement level and areas that need improvement. By creating a feedback culture, you can create a more productive and positive workplace.

Give Your Employees the Recognition they Deserve

Employees that feel appreciated and recognized stay longer in their jobs. Studies show that when employee recognition hits the mark, employees are:

• Less likely to leave: 5x as likely to see a path to grow in the organization
• More satisfied: 44% more likely to be "thriving" in their life overall
• More productive: 73% less likely to "always" or "very often" feel burned out
• More engaged: 4x as likely to be actively engaged at work
• More connected: 5x as likely to feel connected to their workplace culture

Creating a culture of recognition in your company is a great way to improve employee retention. Benefits like monetary compensation in the form of bonuses and raises or social compensation like verbal recognition or employee celebrations can go a long way towards showing employees they are appreciated. 

Allow your Employees to Have a Healthy Work-Life Balance

When your team is well rested and has options to help them avoid personal stressors, they will perform much better at work. Set up policies for overtime, working on weekends, etc., and stick to them. Even minor exceptions can lead to a slippery slope that can lead to employees feeling overworked and overwhelmed. Consider hybrid or remote policies that offer flexible hours so employees can take care of their responsibilities without losing work hours. 

Make mental health a priority by developing actionable ways to encourage employees to prioritize their mental health. Ensure such actions are included in policies that clarify your intentions and prove that it's not just talk. For example, instead of simply encouraging employees to take a long lunch break, shut the office down from 12:00 to 1:30 for lunch.

Create a Clear Specific Path to Growth

Employee development and achievement are important parts of feeling a sense of accomplishment in one's role. Employees who know they're making a valuable contribution to the company can develop a greater sense of belonging. As a result, when employees have a clear path to growth within a company, they're more likely to stay. 

You can offer a sense of security by giving employees a clear picture of where they stand within the organization and how they can be promoted in the future. Define how employees can be elevated within the organization and specific steps to take for advancement. Recognize that while not every employee can rise to VP or managerial status, there are ways employees can grow within current roles. For instance, increased responsibilities with corresponding compensation is one path to growth.

Build a Community

Most people want to have a sense of belonging in the workplace. A role at work is more than a function, it's a connection with a team in which each employee makes a valuable contribution. Build a sense of community within your organization that encourages employees to share similar experiences and support one another. Such efforts don't have to be complicated. Consider how these simple things can have a tremendous impact.

• Create co-worker socialization by hosting team movie nights, creating spaces for employees to express themselves, allowing for curiosity and innovation, 1:1 coffee times that pair employees across teams, afternoon picnics during work hours, etc.
• Ensure leadership talks about the company vision regularly, reminding employees about their contribution.
• Create values based on collective intelligence.
• Allow strengths to be lifted to greater heights vs. only focusing on weaknesses.
• Build a culture that lets employees know how their contributions matter.

Learning about all aspects of employee well-being is essential to creating effective employee retention strategies in the workplace. Accessible mental health care is a necessity in every workplace. To learn more about how employee mental health benefits drive retention, download our research paper on Employee Retention.