Top Reasons for Employee Turnover

It’s impossible to keep the same set of employees throughout your organization’s lifetime, but when workers leave too frequently, it’s usually a sign of a problem. So let’s talk about top reasons for employee turnover and how possible it can be controlled.

Employee turnover isn’t always a natural occurrence; it’s usually fueled by certain factors that aren’t usually good. If your company is having a high employee turnover, you may want to learn about, and possibly avoid these factors.

In this article, you’ll learn all you need to know about employee turnover. Also, you’ll learn some of the most common reasons why some companies have high employee turnovers, and how it affects you as an employer or employee.

top reasons for employee turnover

What Is Employee Turnover?

Employee turnover refers to the percentage of workers that need to be replaced in a workplace within a specific period. The turnover rate doesn’t really take how the employees are left into account; once an employee leaves your company, it will add to your employee turnover rate.

Employee turnover is of two main subdivisions; voluntary and involuntary turnover. Voluntary turnover refers to the volume of employees leaving your company for a better opportunity, while involuntary turnover basically accounts for the employees you fired.

Top 15 Job Interview Questions and ...
Top 15 Job Interview Questions and Answers

While both of these types of turnovers are quite distinct, they both paint a negative image of your organization. If you fire too many workers, it means you’re not good with selecting talents for your organization in the first place.

On the other hand, if too many employees are leaving your organization, it may not be a very interesting place to work after all.

High employee turnover is generally regarded as a bad thing, but what counts as a high turnover depends on your specific industry. While hotel and restaurant workers aren’t expected to retain their jobs, public service generally has a low turnover rate.

If you have a disturbingly high employee turnover rate compared to the rest of your industry, you should know why. The next sections explain some of the top reasons for employee turnover.

What are the Factors Affecting Employee Turnover?

Having a high employee turnover almost always signifies a problem. Fortunately, the causes of a high turnover rate are pretty obvious, making it easy for employers to retrace and correct their mistakes.

Here are some of the top reasons for employee turnover and some clever ways you can use to avoid this from occurring.

Paying less than the rest of the industry.

Employees aren’t biologically related to you. If you’re paying considerably lower than the industry standard, most of your employees will gladly leave your company for an alternative that pays more.

According to recent research, around a quarter of employees will happily leave their jobs for one with higher pay. Unless your company offers unique incentives that keep employees in the company, you should update your employee’s salaries to meet industry standards.

Employees also tend to favor companies that offer incentives other than payment. Benefits like holiday packages, free healthcare, dental insurance, and accommodation are all incentives that encourage employees to keep working at specific organizations.

Overworking employees and lack of empathy.

Empathy simply refers to the state of putting yourself in someone else’s shoes. A boss with empathy won’t overwork their employees, so these two factors usually go hand in hand.

When employees are constantly asked to work for longer than they initially signed up for, they’ll start to hate their job, even if you’re paying them decently enough. This can constitute burnout, which eventually leads to decreased productivity.

When your employee decreases dramatically in productivity, they either resign from the organization or you fire them for lack of output, making one of the top reasons for employee turnover.

Boredom

There are some factors you can’t just control. While you may pay your employees decently and ensure a good working environment, sometimes, people just get bored.

It’s usually not the employer’s fault when someone tries to change professions. While this factor represents a minute part of your employee turnover rate, it’s still a factor to consider.

Bad hiring practices.

If an organization is suffering from high involuntary employee turnover, it’s most likely a problem with its hiring process. If a company doesn’t follow due process when hiring employees, they’re most likely to fire them soon enough.

Also, a nontransparent hiring process that hides most of the realities of working in the organization only breeds quick resignations.

Limited opportunity for growth and development.

Most employees are working to secure a future for themselves in the industry. If an organization or startup doesn’t offer a training program or an option of further education for employees, they’re most likely to ask out.

There are many other ways to offer career development services to employees in a company. Offering coaching and mentoring programs, and sponsoring outstanding workers to further education are some creative ways to help develop your employee’s careers.

No recognition or feedback.

Only 3.6% of workers with positive feedbacks from their managers actively seek new jobs, according to a survey by Gallup. This statistic shows how important it is for managers to offer compliments and constructive criticism to employees.

Also, managers should understand that excessive negative feedback is worse than none at all. While employees know they aren’t perfect, criticizing all of their work without praising any just makes all of the work feel unworthy.

Bad management.

The single factor that contributes the most to a high employee turnover rate might be bad management. There are many characteristics of bad and toxic managers that might compel most employees to resign from their jobs.

Some managers are so bad that they yell at employees, give no positive feedback or constructive criticism, and even take credit for works by other employees in the company.

If your organization is struggling to keep non-administrative employees, reviewing the significance of the managers’ performances becomes imperative. Firing incompetent managers might be the only push your company needs to lower its employee turnover.

Pay cuts.

Nobody ever wants to earn lesser than they did the previous month. If employees of a particular company are forced to tolerate frequent pay cuts, it may fuel an already high turnover rate.

When hiring employees, it’s important to tell them all what they’re getting into. It would be pretty unfair for someone to get a pay cut on their second week because that’s what you do when someone got late twice.

Toxic culture.

Nobody wants to work at a company where they’ll dread going to. As obvious as that sounds, as much as a quarter of US employees would rather not go to work. They hate the negative vibes around their workplace, resigning and firing up the company’s average turnover rate.

It’s usually impossible to link negative workplace culture with a specific cause. Most of the factors that contribute to this are already mentioned in previous points in this article, but they’re not limited to those.

If new employees are resigning at an alarming rate, it’s time to go back to the basics. Review the work environment in the company and try to determine the employees’ satisfaction rate. That way, you can deduce what doesn’t work and find creative ways to change it.

How to Reduce Employee Turnover

 Since you already know the top 10 reasons for employee turnover, it’s also time to learn how to lower the turnover rate in your organization.

Before that, however, it’s important to note that lower turnovers aren’t always great. Employees should naturally search for greener pastures unless you’re overpaying them in the first place. If you aren’t firing any employees, maybe you’re condoning complacency in the workplace.

In short, you shouldn’t always shoot for zero employee turnover. However, you should know there is a problem when your turnover rate exceeds 10%.

To lower an unhealthily high turnover rate, you must try to invest in your employees. Employing career coaches and offering them continuing education while they work are both great ways to keep them happy, thereby retaining them.

You also want to ensure that they’re well compensated for their work. Compensation isn’t always in monetary terms. Paid holidays, frequent days off, and work-from-home options are all compensations that most employees value.

If you have mostly negative employee turnover, you may want to up your employee selection process. It’s undoubtedly difficult to choose great talents, especially for a startup, but with the right experience and training, you can learn to always get it right.

Feedback is also an important aspect of employee satisfaction. Be quick to point out your employees’ successes, as people are usually happy to learn about their wins.

At the same time, you may want to provide constructive criticism for when they don’t perform so well, to help them understand what you want from them exactly. These practices will preserve workplace satisfaction, helping you maintain a low employee turnover rate.

Conclusion

Losing employees to competing companies is a worrying but inevitable happening for business owners. While employee turnover might seem like a bad thing almost every time, it’s not usually bad until it gets excessive.

In this post, we detail some of the causes of employee turnover and strategies to reduce it. Also, it teaches some employee turnover causes and effects and how it affects an organization.

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