According to Gallup, self-reported employee turnover risk is at its highest since 2015. Gallup’s survey shows over half of employees intend to look for a new job or are actively doing so. Eagle Hill Consulting's latest report confirms this data, suggesting that employee turnover may rise early next year.

That’s unfortunate for organizations struggling to find top talent, as employee turnover is a costly problem. Conservative estimates indicate that the cost of replacing an employee can range from one-half to two times their annual salary. A 100-person company with an average annual salary of $50,000 equates to turnover and replacement costs of anywhere from $660,000 to $2.6 million per year. Losing key talent has other potential negative side effects:

• Lower employee morale
• Lost productivity
• Missed deadlines
• Diminished employer brand
• Additional resignations

5 Ways Companies Can Reduce Employee Turnover

Fortunately, voluntary employee turnover is preventable. Over half of employees who resign say their manager or company could have done something to prevent them from leaving their jobs. Let’s review five ways companies can improve the employee experience to reduce turnover.

1. Offer Career Development Opportunities

Corporate training is a strategic investment that empowers employees and keeps them engaged. LinkedIn’s 2023 Workplace Learning Report indicates that organizations investing in employee development experience 32% higher employee retention rates and a 28% increase in employee satisfaction. Career development is so important that according to Korn Ferry’s Talent Acquisition Trends survey, 67% of professionals would stay in a job they hated if they were offered advancement and upskilling opportunities. Training and development also have a positive impact on the bottom line. A 2022 Deloitte study found that, on average, a 1% increase in learning and development (L&D) spending correlated to a 0.2% increase in business revenue. That means that every $1 invested per employee resulted in an additional $4.70 in revenue.

There are many ways to improve career development and reduce employee turnover:

• Create a career path framework
• Offer mentorship and coaching programs
• Partner with senior leaders to create a learning culture
• Encourage cross-functional experiences, shadowing and job rotations
• Acknowledge employees who spend time learning new skills

2. Show Employees You Care About Their Well-Being

Employees thrive in environments where they feel appreciated and supported. Yet, employees’ mental well-being is at an all-time low. More than half of U.S. workers are experiencing some level of burnout. When employees burn out, they are disengaged, absent more often and more likely to quiet quit or leave the company.

Here are a few ways organizations can prioritize employee health and wellness:

• Ensure workloads and deadlines are reasonable
• Destigmatize mental health by creating space for open conversations
• Implement wellness programs customized to the needs of employees
• Provide free resources that support employee financial well-being
• Coach leaders to show understanding and compassion during trying times

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