According to a recent survey, employers are not doing enough to track the reasons why staff leave and don't have a watertight retention strategy.

Employee engagement and retention consultancy TalentDrain, which carried out the Employee Retention Survey 2008 research, found that out of 316 organisations, three out of four have no budget for employee retention. However, while 47% of HR professionals admit to having a problem when it comes to retaining staff, 65% want to reduce their employee turnover.

Research authors, Ron Eldridge and Anthony Miles, comment: “HR professionals pay lip service to retention but they still regard recruitment as more important. Unless more organisations monitor staff turnover, understand who is leaving, and why, and implement targeted interventions, then employee retention will continue to slip through the cracks.” 

Survey results

• 44% of organisations have a staff turnover rate higher than 15% per year, with one in ten exceeding 30% per year
• In organisations with over 500 employees, 36% have a turnover rate exceeding 20%
• 81% of organisations believe staff turnover has a detrimental impact on their effectiveness

Wise up

HR professionals believe that 61% of employees leave because of ‘lack of promotion opportunities’; 49%: ‘inadequate pay’ and 26%: ‘poor relationship with manager’.  

However, anonymous exit data, collected from 5,000 leavers, across different industry sectors, reveals that although ‘promotion prospects’ and ‘pay’ are indeed drivers for leavers, they are not as important as other factors that drive employees out, which include:

• 25%: uninteresting work and boredom
• 25%: lack of training and development opportunities
• 19%: lack of teamwork and cooperation
• 17%: promises not kept by management

Retention initiatives implemented over the past year include:

• 66%: improving employee communication and involvement
• 56%: improving the induction process
• 47%: increasing learning and development opportunities

“Organisations that provide challenging work and opportunities for training and development are more likely to experience a lower rate of staff turnover,” say the authors.  “Surprisingly, only 7% of organisations attempt to redesign jobs to make them more satisfying. Particularly with monotonous or inflexible jobs, this can have a big impact on employee retention and well-being.”

While 57% of organisations use traditional face-to-face exit interviews as their main source of data to find out why people leave but only half of them aggregate the data, to reveal exit patterns, only 4% collect anonymous exit data.

The message is clear, don't treat the exit interview as simply a check-box exercise. When you consider that on average, the cost to replace an employee is between £7,750-£11,000, with additional ‘costs’ such as lost opportunity time, it's worth investing in employee engagement and dedicating time in shaping up your exit process.

For the full report:

The Employee Retention Survey 2008’ can be downloaded free from TalentDrain’s website: www.talentdrain.com