How Employers Are Addressing Employee Turnover

Nowadays, turnover rates have reached their peak as employees continue to job-hop in search of suitable terms of employment. While last year, employers paid $600 billion in turnover costs, it was found that 77% of that turnover could have been prevented by employers. In the same year, 1 in 4 employees quit their job, due to an array of reasons, but it seems ghosting is the primary driver of the issue. In order for companies to keep their team members satisfied, employers must get crafty with their leadership, as will be further explained below.

Ghosting is defined as whenever the person whom you were having a relationship with unexpectedly stops all communication. The commonality of ghosting on a human level has made its way in the job industry. Now more than ever, candidates are agreeing to show up to job interviews, then never showing up. Continuing, some accept jobs, only to never appear on their scheduled first day of work. Even further,  instead of formally quitting or resigning, some employees simply refrain from ever showing back up to work, or communicating their resignation. Due to these outstanding circumstances, the cost of employee turnover will continue to rise to $680 billion by 2020.

Further on the topic of “ghosting,” management may not realize they have been ghosted until, 1) employees never show up, or 2) endless failed attempts at contact, resulting in obvious days of no-shows. The underlying question of the matter is: why are candidates ghosting their employers? The simple answer is pickiness. With the job market at its historical peak steadiness, the reality is that employees can afford to be choosey. All-in-all, employees are seeking opportunities with fair leadership, treatment, and wages.

Along the lines of the job market, the American U.S. economy added 224,000 jobs in June 2019. This made our country’s unemployment level lower to 3.7% – nearly a 50-year low. Since 2018, wages increased by 3.1%. Although job after job is added to the market, employers still prefer quality over quantity.

This year, 1 in 3 U.S. workers are seeking a change in employment. Primary reasons employees want to leave their jobs to include a desire for an increase in pay (54%), taking the chance to advance their career (38%), and the aspiration for more benefits (21%). As employers are shifting their management to cater to the workforce, even corporations such as McDonald’s (which is built to withstand a revolving door of employees) are seeking more problems with finding employment than usual. In fact, turnover in the entire fast food industry is at its record high.

Replacing an employee is turnover typically racks up a hefty tab. When replacing an employee after their resignation, employers fork out at least 1/6th of the employee’s annual salary, and even more for higher-paid, more specialized employees. On average, it costs $4,291 to replace a $10/hour retail employee. The specifics regarding what companies are left to pay for in explanation for it costing so much variety. Ultimately, money is spent on improving tactics to keep employees satisfied, and ultimately retained. As you read more below, you will find specifics on what employees want, and how employers are catering to these needs in relation to employee turnover.