Employee Resignations, Quiet Quitting and Metrics to Measure Retention
Retention is critical for today’s employers, as employees continue to quit when they realize they aren’t qualified for the role or don’t want to put in the necessary work?
Key takeaways:
Retention is a top consideration for today’s businesses. The transformation of how work is done over the last few years has meant that employees have different expectations.?Remote work ?has become the norm for many organizations, and flexibility is more important to today’s employees.
Even when staff don’t resign, however, they may be “quiet quitting.” This term refers to employees who decide to just meet the basic qualifications of their jobs without going above and beyond. While this doesn’t always result in resignations or turnover, the trend of quiet quitting can lead to reduced morale, lack of productivity and a general sense of inertia in the workplace, for both staff and leadership. In fact, Gallup reports that?half of all workers ?have participated in quiet quitting.?
Employers are still struggling to deal with the Great Resignation and quiet quitting as they work to retain their top talent. To turn things around at your organization, you can measure retention and monitor quiet quitting, and then use the data to improve your?work environment .?
Why employee retention is important
Employee retention and engagement can tell you a lot about your effectiveness as an employer. It is your responsibility to create an enriching work environment and provide the right mix of perks and benefits to support people. This means keeping staff satisfied with their work and with the company while looking out for signs of quiet quitting or disengagement.??
When you have a high retention rate, you’re doing something right. People want to stay. On the other hand, when you have a lot of people quitting for other jobs (or staying but quiet quitting), it signals there’s a disconnect between staff and the organization.
Companies that prioritize retention perform better and see a healthier bottom line, too. The?cost to replace an employee ?can range from one-half to two times their annual salary, and sometimes it could be even more. According to employee retention statistics from 2021 in the?Workplace Learning Report , employees at companies with internal mobility stay almost twice as long as those that don’t offer that sort of advancement. Organizations can save money by keeping people. In addition, losing employees, whether to resignations or quiet quitting, means team morale could suffer and productivity may decrease.
Four metrics for employee retention
Preventing turnover and improving retention can be accomplished by prioritizing the needs of employees, opening communication, listening and offering the benefits staff care about. That said, it’s important to first understand your current?retention rate and related metrics ?to assess what’s really going on and how you can best find solutions. Here are some metrics to keep in mind as you develop your own plan.
1. Retention rate
Of course, you can’t measure retention without starting with your retention rate. You can find this metric by taking your total number of employees and subtracting the employees who left in a period, and dividing that number by your total number of employees. Multiply by 100.
For example, if you have 200 employees, and you lost 20 in 2022, your retention rate would be: ((200-20) / 200) x 100 = 90%.
You want your retention rate to be high. This key measure indicates where you stand now and helps you set goals and benchmarks moving forward. You can also use the same retention rate formula for specific departments, managers, generational groups and other parts of the business.
2. Turnover rate
The turnover rate is different from the retention rate. It instead measures the rate at which people left in a given period. The formula involves taking the number of people who left in a period and dividing it by the number of employees you had in that same period. Multiply by 100.?
So, if we continue with the above example: 20 / 200 x 100 = 10%.
It is wise to measure voluntary turnover first, which comprises the people who left at will, usually for another job. Involuntary turnover can be measured the same way, but it tells you the rate at which people were let go or laid off in a period.
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3. Cost of turnover
You should also become familiar with how much it costs to lose an employee, and how much total you’re spending on turnover. You will have to track all costs associated with losing someone, including posting the job ad, background checks, time missed from work dealing with interviews and candidate searching, onboarding and training costs, salary and more.
Track this information every time someone leaves, and add everything up each month or year to get a sense of what turnover is costing you overall.
4. Employee satisfaction and engagement
Whether or not employees are happy at work can tell you important information about retention. Satisfied, engaged workers are more likely to stay in their roles. You can measure employee satisfaction using simple surveys, like the Employee Net Promoter Score.?
This survey asks one simple question to employees: On a scale from 1 to 10, how likely are you to recommend [company] to a friend or colleague??
Depending on your organization type, size and unique needs, you can customize an employee satisfaction survey and compare the results over time to look for trends that could impact resignations, quiet quitting, productivity and the company’s bottom line.
How to combat quiet quitting
It may be necessary to go beyond the typical employee satisfaction survey metrics when dealing with quiet quitting given that it can be harder to track. Here are a few additional tips to prevent or stop this behavior.?
Talk to employees
An honest, one-on-one conversation with a staff member can go a long way. Consider opening a nonjudgmental dialog about an employee’s decreased productivity or satisfaction to see if you can come up with solutions together. Ask employees directly how happy they are at work and what they would change. Gauging employee sentiment by asking for feedback is a great way to show them you care while gathering valuable information about what you might be able to change.?
Follow through on commitments
Keeping a promise (for example, workload will go back to normal after a big deadline is met or employee reviews will happen annually) can help keep staff feeling happy and valued. These actions can seem like small gestures, but staying true to commitments may help reduce bouts of quiet quitting and improve staff motivation.?
Be patient
If you suspect an employee of quiet quitting, check in with them as needed but, if possible, give them time to rectify the situation, ideally with the organization’s support and tools. Change doesn’t happen overnight, and a supportive workplace willing to help employees grow and change may do the trick to get your staff back on track.
Sometimes, despite all efforts, it may be impossible to change the attitude and lackluster work ethic of an employee. However, an exit interview can be another excellent tool to help mitigate future quiet quitting trends in the workplace. When an employee does move on, conduct an exit interview to get their honest opinions on what worked and didn’t work for them. This information may be useful in combating quiet quitting with other staff before the problem escalates.?
How StaffLink can help you improve Human Resources metrics
These employee retention measures and quiet quitting tips can help you understand how you’re doing as an employer and what you need to address sooner rather than later. One thing is certain–focusing more on keeping your people engaged tends to help the business succeed.?
Your approach to Human Resources (HR) matters to employees. Integrating the right tools and solutions can help bolster retention and engagement. At StaffLink, we can help you improve HR with bundled payroll, benefits administration, risk management and much more.?
Request a proposal ?or contact us at (954) 423-8262 for more information.
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