Employee Retention: How to Keep Your Best Employees

Summary: Strong employee retention starts with fair compensation, supportive benefits, career growth opportunities, and creating a workplace culture that makes people want to stay. 

Holding onto your best employees helps you maintain stability, reduce turnover costs, and build a team that’s invested in your company’s success. Small businesses with limited resources must prioritize employee retention because of the high cost of replacement. A strong employee retention strategy focuses on building a workplace where people want to stay, not just keeping them there.

The benefits of employee retention

Employee retention benefits your business in more ways than one. When employees stay, they develop a profound knowledge of your operations, build stronger relationships with customers and contribute to stability and a productive environment.

Effective employee retention strategies also help you reduce the time and cost that you must spend on recruiting and training new hires. Employees who stay longer often become advocates for your business, and help you focus your energy on growing your company. Ultimately, a loyal team strengthens your company’s culture and helps drive its long-term success.

Employee retention plan to ensure your staff stays put

From compensation and benefits to workplace culture and growth opportunities, small business owners can implement a variety of effective employee retention strategies to keep their employees. Here are some helpful tips on how to keep employees and ensure your staff is happy with the work culture you offer.

1. Get the compensation right

To increase employee retention, consider revising the compensation of your deserving employees to the market standards. If you are not sure about the right salary range, you can find United States salary data in several places, including RobertHalf.com and Salary.com. You can also find market rate salary information from local business owners, temp agencies, and your local or state chamber of commerce.

Consider providing various benefit plans, such as group or individual life insurance, long-term care and supplemental retirement options.

2. Think past the paycheck

Owners of small businesses have the option to offer several cost-effective but meaningful perks that make a good employee feel valued. These can include taking them out to lunch, giving them a gift certificate to a local restaurant or providing them with a value-added service like employee travel assistance, paid family & medical leaves or even a flexible schedule that allows working from home. You may also encourage your employees to save for retirement.

3. “Invest” in your good people

Let valued staff feel that their career can grow as the business does. As an employer, you could pay for work-related seminars, courses or conferences for your employees. You can also think of projects within other parts of the company that the employee can eventually grow into or enroll them into various short-term and long-term financial planning seminars.

4. Create a positive work culture

Big companies do this by creating elaborate statements and programs. Owners of small businesses can achieve this with everyday actions, including:

• Sharing your vision, goals and expectations.
• Giving every employee a chance to be respectfully heard.
• Checking in frequently on how projects or tasks are going.
• Noticing employee contributions and encouraging others to do so.
• Having quarterly employee town hall meetings where everyone can discuss business.

All these actions will help foster a culture of camaraderie and pride.

5. Build flexibility into your workplace

The ability to work remotely, adjust hours, or accommodate personal needs can make a big difference in employee satisfaction and retention. Flexible work options support a healthy work-life balance, which is a top priority for today’s workforce. Businesses that offer flexibility to their employees often see reduced burnout, higher morale and improved employee retention.

Why does employee retention matter more than ever?

The cost of employee turnover is staggering. Some studies estimate it can cost up to twice an employee’s salary to replace them. But the impact goes beyond dollars. High turnover disrupts productivity, strains team morale, and can damage customer relationships.

Strong employee retention allows small businesses to build a cohesive, experienced team that works efficiently and supports company goals. Happy employees create a healthy workplace culture, which leads to better customer service and stronger brand loyalty. A positive work environment helps recruit new talent, boosts employee engagement and increases your team’s resilience during challenges.

Mutual of Omaha can help small business owners retain quality employees with benefits like group or individual life insurance, long-term care and supplemental retirement options.

FAQs

Q1. How do I improve employee retention in a competitive job market?

In a competitive job market, it’s hard to keep quality employees who may be attracted by another offer. Small business owners can boost employee retention with competitive compensation, valuable benefits, flexible work arrangements, and a positive workplace. Investing in career development and open communication can also help keep top talent.

Q2. What are common reasons employees leave small businesses?

Employees often leave small businesses because of a mix of practical and personal reasons. Common factors include limited opportunities for career advancement, feeling unappreciated, lack of competitive pay or benefits, a toxic work environment, and poor management. Sometimes, employees may also leave because of burnout from being overextended or unclear expectations in their role. If these issues aren’t addressed proactively, even loyal team members may explore other options.

Q3. What benefits are most effective for employee retention?

The most attractive employee retention benefits are ones that support an employee’s financial security, health and work-life balance. For example, a company that requires employees to work every weekend may see high turnover because it doesn’t provide adequate work-life balance.

Health insurance, retirement savings plans and paid time off also rank high in importance for employees. They may also value flexible work schedules, mental health support, professional development opportunities and disability income protection.

Offering a well-rounded benefits package shows employees you care about their overall well-being, not just their work performance, which may boost employee retention and loyalty.

Disclosures:

Registered Representatives offer securities through Mutual of Omaha Investor Services, Inc., Member FINRA/SIPC. Investment Advisor Representatives offer advisory services through Mutual of Omaha Investor Services, Inc.  Mutual of Omaha Advisors is a division of Mutual of Omaha Insurance Company.

All investing involves risk, including the possible loss of principal, and there can be no assurance that any investment strategy will be successful.

Mutual of Omaha and its representatives do not provide tax and/or legal advice, and the information provided herein is general in nature and should not be considered tax and/or legal advice.

Not all Mutual of Omaha agents are registered representatives or financial advisors.

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