Attracting and retaining top talent remains a persistent challenge for many businesses, as employees continue to explore new opportunities and the labor market remains highly competitive.
Today’s workforce is more selective about where they choose to work, placing increased value on growth, flexibility, purpose and culture. For organizations, strengthening employee retention is no longer just an HR priority but a critical component of long-term stability and success.
It's easy to point to external disruptions as the reason employees are rethinking how and where they work, but understanding the deeper motivations behind these changes is key to improving employee retention.
Competitive studies found that the most common factors driving job change are:
Other studies have found that the high productivity that stems from remote work is masking an exhausted workforce where 54% of employees feel overworked, with 62% of meetings being unplanned, and the average meeting lasting 10 minutes longer than usual. Even more indicative of the heightened workload, the average user sends 45% more chats per week and 42% more chats after typical work hours.
Employees are redefining what makes a job ‘worth it,’ weighing flexibility, wellbeing and purpose alongside compensation. Shifting employee priorities are reshaping how individuals evaluate their work, with greater emphasis on health, wellbeing and overall quality of life.
As a result, more employees are seeking work arrangements that offer flexibility and balance, including hybrid models that combine in-person collaboration with remote work options.
1. Give them what they want even if they want it all. Right now, the future of your business will dictate a longer-term strategy, so focus on short-term doables. Studies show that 70% of workers want flexible remote work options to continue, while 65% of workers are also craving more in-person time with their teams. The solution? Something 9 out of 10 organizations are already planning on implementing: a hybrid on-site and remote work setup.
2. Go beyond traditional incentives to make your company stand out. Hot job markets can start to look the same when everyone is offering the same bonuses, work from home option or ping-pong table in the breakroom. And with 60% of HR professionals opening new positions for entry-level hires, you can bet everyone is looking for ways to stand out. Consider offering a company culture that aligns with your hiring goals. For instance, 72% of college seniors would only consider employers who are committed to Diversity, Equity, and Inclusion hiring practices. So, don’t just talk the talk—walk the walk.
You are more likely to retain engaged employees. Approaching retention from an organizational commitment perspective can have a direct impact on employee engagement — some good ideas to drive commitment and a sense of belonging is to boost transparency, create opportunities for networking, mentoring and idea sharing, and following the example of the 67% of productivity-leading businesses that report an increase in improved connections among employees. Simply put, fostering opportunities for employee connections positively impacts employee engagement and productivity.
1. Continuance Commitment. Employees stay because of compensation.
2. Affective Commitment. Employees stay because of the people, culture, work and emotional attachment.
3. Normative Commitment. Employees stay because they feel obligated due to length of employment or how much the company has invested in an employee.
While Continuance and Affective Commitments are great motivators during hiring, Normative Commitment plays a large role in retention. If high turnover has been an ongoing challenge, it may be worth evaluating whether employees feel a genuine sense of investment, support, and long-term opportunity within the organization.
It may also help to think about your business in a whole new light and consider if it’s the type of place people not only want to come to—but to stay. One company that snatched success from failure with this method is Recruit Holdings, a tech and ad company from Japan.
When the CEO of Recruit got caught up in shady share selling that also took down the prime minister of Japan and his entire cabinet, the world thought Recruit was done for. As the company braced for the worst, it realized it had let all of its employees down, so the company started developing and training its workers in ways that would help them get jobs after the demise of Recruit—in short, it became a good company to come from, which made people want to go work for Recruit.
Employee innovation, flexible work and a focus on letting workers follow their passions helped Recruit maintain its top talent—against all odds—and grow to be the $20 billion tech company they are today, as well as owners of Indeed and Glass Door.
The bottom line is that there’s no one right way fix employee retention right away—it’s many strategies working together as one, learning from the past and moving ahead together. In a competitive labor market, employee retention is not solved by a single initiative; it requires a commitment to building a workplace people want to stay in and grow in.
We’re here 24/7 to help you navigate your journey. If you have questions about the financial side of employee retention, or want to know more about digital solutions simply use the form below to speak with your local banker.
Topics: Employee Management, Business Management
Equal Housing Lender. Member FDIC. NMLS# 608046
Share: