According to the US Department of Labor and Statistics, turnover rates can be costly because of the need to keep hiring new people. While in the short term it may benefit the company since new people can be given only basic salary rates, but in the long term, if the company keeps hiring new people every two or three months, then this affects productivity and employee morale.
It is therefore necessary for human resource management to focus on reducing turnover rates by attempting to understand the reasons why good employees quit.
The job was not as expected
Some companies make the mistake of doing job changes from the original description and what was promised during the interviews all are thrown out the window. It becomes painfully clear to the new hire that the company is playing the bait and switch game that ultimately leads to mistrust. The new hire will now think, “What else are they lying about?”
Work and life imbalance
When the company starts to demand multi-tasking and doesn’t give a damn about family life, most good workers would rather quit than to lose their families, even in this time of economic crunch. This often occurs when the company’s turnover rate is high and employees need to double time on the work.
Management freezes raises and promotions
Money isn’t usually the first reason why people leave an organization but it does rank especially when an employee can find a job that will earn more. Company wages should be competitive and benefit packages attractive.
It’s human nature to want to be recognized and praised for a job well done. Recognizing employees doesn’t only mean a salary raise or promotion; sometimes it can be a simple “thank you” or telling the employee that he or she did a good job. It all boils down to appreciation.
Irrelevant training provided
Many managers have no clue on how to help employees improve their performance and often give training or seminars that are irrelevant to the job. With some companies, they make the mistake of making employees train each other, with disastrous results.
Management lacks people skills
Naturally, many managers were promoted because they did their job well, but that doesn’t mean they know how to lead. Also, being a leader means being able to motivate and to know at least the basic details of each employee that will help him or her lead the team.
Loss of faith and confidence in its leaders
When a company has a high turnover and employees left behind are made to multi-task and thus, are made to do more and more, they will see less and less evidence that they will share in the fruits of their successes. Another fault of employers is even when revenues and profits are up, they are still thinking competitive wages but not benefits. Employees have the right to benefits such as bonuses or even creative development opportunities financed by the company. When these things don’t happen, the employee loses faith in its leaders.