How to Improve Retention With a Better Employee Culture
Recruitics
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Key Takeaways:
It’s an unfortunate but all too familiar story: A hiring professional recruits a candidate who accepts the job, only for them to not show up on their first day. This scenario highlights the extent to which improving retention is becoming a major priority in today’s labor market. In fact, roughly half (51%) of all new hires either decline their offers or completely ghost the employer after receiving them. Other hiring managers report that almost one out of five new hires (19%) quit within the first six months. Of course, these outcomes beg the question: Why are retention rates so low??
For the candidates, it may be attributed to a fear of missing out on another employment opportunity. Roughly half (47%) of candidates who accept a job offer are still open to other opportunities, and another 42% believe that they can find a better offer if they continue to look. It’s easy to see why that mindset is becoming more widely adopted. According to the Department of Labor Statistics, the number of available jobs remains relatively high. Despite recent fluctuations, there are still nearly nine million job openings available as of October 2023, making for a bit of a “candidate’s market” at the moment.?
Employers, however, bear the cost of these low retention rates. The Society for Human Resource Management (SHRM) reports that the cost of a new hire can be three to four times the position’s salary . In other words, if a business is hiring for a position that pays $60,000, it could end up spending as much as $240,000 by the time it fills the role, and if employees are coming on board in January but leaving by June, hiring professionals can imagine the cumulative cost to the company.?
That is to say nothing of the non-financial costs of frequent turnover. HR consultant Sharon DeLay believes these low retention rates drain productivity and the overall morale of hiring teams. “The mental and emotional toll of all the ghosting, demands, etc., aren't sustainable and likely causes them to lose focus on other duties,” she tells the SHRM.
Given these trends and costs, organizations are eager to find ways to improve retention, particularly among recent hires. The following three methods can help businesses combat the epidemic of no-shows and rapid turnover and help teams operate with greater efficiency.
1. Improving Retention by Increasing Transparency
“Why are you leaving your current position?” It is a common enough question for job interviews, and it assumes a certain level of transparency on the part of the candidate. That said, employers and hiring professionals should do the same, offering job seekers a high degree of transparency regarding the position that focuses on two general areas: transparency regarding the compensation package and transparency regarding the candidate’s day-to-day experience.?
Transparency About Compensation
First, candidates need to gauge whether a job will meet their needs even before they apply. In states like New York, Colorado, or California, companies are bound by wage transparency laws that require employers to become more transparent about pay by posting salary information on their job postings, a practice that has steadily increased over time from appearing in just 18.4% of postings in 2020 to 43.7% by 2023 .
Compensation is just a start. You should be transparent about benefits packages that include healthcare and retirement, but roughly two-thirds (65%) of job candidates are equally motivated by non-financial benefits such as:
Communicating these benefits up front will give an organization a competitive edge that can increase a candidate’s willingness to remain with the company long-term.
Transparency About the Job Experience
Second, you should be transparent about the job itself, and you should anticipate common (and even assumed, unspoken) questions, including the following:
Answering these questions can give job seekers a better understanding of what to expect should they accept the role, and by being transparent about the candidate’s actual experience, you effectively avoid the kinds of surprises that can derail the candidate's journey and impact morale and employee retention.
2. Improving Retention by Building Connections
According to data reported by SHRM , the number of workplace friends an employee has is directly related to how much that individual loves their company. Roughly two-thirds of workers with six or more friends report “feeling deeply connected to their companies,” but that number drops to less than half of workers with fewer than six friends, and only a quarter of those with no friends claim to love their company. Building relationships can, therefore, help you improve your retention rates, and you should work to do so at every phase of both the candidate and employee journey.?
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Building Connections Through Marketing
It’s wise to make team members a major part of your recruitment marketing content. Video content with solutions like Jamyr can be a great way to present candidates with a warm and welcoming face and a live-action preview of the working environment to help candidates better envision themselves at a company. You can also include engaging content and landing pages that can be further tailored to your brand’s ad networks and social media platforms. Creating unique ads tailored for each platform and each talent audience can help forge better connections with job seekers.
Building Connections During the Interviewing Process
While the interview process will primarily involve the hiring manager and a department head, steps can still be taken to build relationships early on. With that in mind, you should introduce the candidate to team members as soon as possible so they can start associating names and faces of who they’d be working with should they accept a job offer. A strong initial connection may make job candidates less likely to ghost a company before their official start date.
Building Connections After the Hire
Relationships are also important for creating a smooth onboarding process. One of the best ways to do so is through a mentorship program, in which new hires are paired with an older or more experienced staff member. These mentors can provide an insider’s perspective about how to thrive in the workplace culture and can be “safe” spaces for new hires to raise questions and concerns.
3. Improving Retention by “Selling” the Company
Hiring teams have become marketing teams focused on communicating the company’s employee value proposition (EVP) to attract and retain top talent. In other words, they must “sell” the company and demonstrate how its workplace can satisfy the needs of the company’s employees.
Communicating Company Culture
The Harvard Business Review reports that a surprising nine out of ten workers would be willing to accept less money in exchange for a chance to perform “meaningful work.” With that being said, an organization has a better chance of improving retention by connecting each role with its larger goals and values. For instance, in a finance company, every employee should understand their individual role in helping small business owners receive the funding they need to thrive.?
You can also sell the more practical aspects of their company culture, including how candidates will benefit from accepting a position. That can include things like their salary, benefits, mentorship programs, flexible working schedules, career growth opportunities, a modern work environment, and other attractive things that make the company stand out.
Revising an EVP
Companies are constantly evolving, and so are candidate expectations. As such, you’ll want to get into the practice of revisiting your EVP statement every twelve months and refreshing your employer brand direction every six to twelve months. This is to ensure that your overall EVP continues to align with the company’s benefits and expectations of your target audience, while also giving audiences a fresh view of the brand and your messaging.
Things can start with a survey of existing team members to understand what they love about the company and what they desire for the future. Understanding the motivations of ideal employees can help you know what to include in the next iteration of the company’s EVP. It also enables you to keep your brand’s offerings fresh, while dated benefits can lead to a bad employee experience and contribute to attrition – especially if the job is advertised one way while the interview reveals conflicting information.
Tip: Pay particular attention to the diverse expectations of those from different generations or cultural backgrounds. Younger generations , for instance, may place high value on childcare benefits or flexible working hours, and diverse workplaces may appreciate flexible PTO to celebrate various holidays and traditions. The point is that you should work to tailor your EVP in a way that demonstrates relevance to your target market so that you can attract and retain talent.
Improving Retention in Any Job Market
While it’s not certain how long the current “candidate’s market” will last, the three strategies outlined above will remain crucial in any career landscape. Pursuing transparency, connection, and unique value propositions can help you better connect with job candidates and improve the strength of your teams across the board.
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Jillian O'Malior is VP of Brand & Creative Development at Recruitics. She has over seven years of experience in the world of branding, marketing communications, and design. From the world of private clubs, to healthcare, to now recruitment marketing, she has effectively utilized her obsessive attention to detail by channeling it into creative and successful marketing campaigns across a variety of platforms and communications channels. Jillian earned her Bachelors of Arts from San Francisco State University in Theatre Arts in 2006. She spends her free time with her daughter, reading, watching classic movies, and baking elaborate desserts that she frequently finishes eating in a single sitting.