As businesses enter 2022, employee retention is sure to be on the top of their priority lists. Employees are jumping ship in record numbers with some companies seeing a turnover rate of up to 30% or more.
What is employee retention?
Employee retention can be described as an organization’s ability to prevent turnover during a certain period of time. It can be done voluntarily or involuntarily. In this case, an employer will fill the vacancy left by the previous employee.
It does differ from attrition. Attrition can be described as the loss of employees due to a natural process such as retirement, elimination, or personal health. In these cases, an employer will not fill the vacancy. This article has some great examples with more detail.
Why is it important to track employee retention?
Simply put, it will cost more time and money to replace a current employee. For example, losing an entry-level employee might cost a business 50% of their annual salary while losing a senior-level employee might cost a business 125% of their annual salary.
Some level of turnover is natural, and rates will vary by industry. It’s important to review your industry when comparing rates. If you’re observing a rate above 15% it might be time to review your company culture and value to employees.
Consider benchmarking internally and externally as a first step to a retention strategy. These insights will help evaluate your onboarding process, employee experience, and areas of improvement within your company culture. It will also help determine how attractive your company is to employees and potential new hires.
How to calculate turnover rate?
Decide on a period of time. Typically, it is one year. Then figure out your average number of employees by adding the number of employees at the start of the period + the number at the end of the period. Divide that figure by 2 and then use this equation:
What can you do to boost employee retention?
There is a myriad of tactics when it comes to building a retention strategy, but there is one that can bring joy throughout the year in a variety of ways = gifting! One of the recent culprits to the Great Resignation is a lack of connection amongst employees. Take a look at how this simple idea can be used repeatedly to build connections throughout your organization.
Onboarding is the first opportunity to create a positive experience for a new hire. While this strategy can be hyper-focused on the best way to administer paperwork, it’s just as important to create experiences that foster relationships and build connections.
Start by sending a care package to employees’ homes before their official start date. It can include promotional gifts linking your business to the goods while also including goods that are local to the headquarters. Help them get a taste of the local flavor! Include a hand-written note detailing the value you see in the new hire.
At Batch, we can curate custom gifts and write your hand-written note on your custom note card. Don’t hesitate to schedule a call with a gift expert to enhance your onboarding experience.
Monthly Connection Ritual
With more employees working remotely, they are meeting their co-workers in person less often. Creating friendships throughout an organization can be vital to an employee’s happiness.
Since it may be harder to organize a physical event every month, a great way to re-think this is by sending a physical gift that can be used or discussed during a virtual event. For example, team leaders can decide on a monthly theme. Based on this information, they can personalize a gift for their team that might be focused on recharging or travel. Then, spend an hour with their team virtually discussing the theme for that month.
Sound like fun? We think so! Plus, it's a great opportunity to have everyone on the same page to build connections.
Milestones might be the most obvious time to gift, and this is when personalization can play a key role. Milestones can cover a variety of categories such as promotions, work anniversaries, achieving company goals, and even be personal events like having a baby.
While it’s important to understand gift etiquette, these are opportunities to honor a specific person. Find ways to make these moments stand out with gifts that are meaningful and will resonate with the receiver. It never hurts to survey your employees about their interests.
A creative way to celebrate work anniversaries could be to share a different gift concept every year the employee is with the company. Each year brings a more enticing gift experience. Not your average pen and notepad! These gifts could include physical items as well as experience-based items. There are endless opportunities to make these fun, cool, and unique to the culture within your business.
Our story at Batch started with the connection of three friends. We value employees, small businesses, and finding the perfect gift. We'd love to help you stay connected to your employees. Contact us today for your business needs.