High employee attrition is a sure sign that your business is on the highway to destruction. Sadly, most business owners and managers are so client-focused that they miss it when employee dissatisfaction hurts their companies.
There are six ways high employee turnover can negatively impact your business, which we will individually identify throughout this article. They are:
- Disrupts Productivity
- High Business Costs
- Damages the brand’s reputation
- Dampens employee morale
- Loss of knowledge and skill
- Employee burnout
Ultimately, we'll let you in on a unique proactive measure that'll stop this 'sinister six' in their tracks.
Disrupts Productivity
Losing employees in droves slows down productivity as the business spends quality time recruiting new staff to fill in the void. Even when new employees are brought on board, it takes a while to learn the ropes of the business, which affects service quality. Customers who are used to certain standards may abandon the company once they notice a drop in the quality of service.
Damages the Business’s Brand
Once service quality drops and clients stop doing business with your company, your brand begins to suffer. Unfortunately, negative reviews spread faster and have a stronger effect on consumers. Before you know it, the brand that costs your blood and sweat to build will come undone in seconds.
Costs the Business Money
So to save the business’s brand, you have to fill the void left by attrition, but employing and onboarding new staff is costly and time-consuming. Available stats indicate that a 100-employee company, with an average salary of $50,000, could spend $2.6 million a year on turnover and replacement.
Dampen Employee Morale
Also, high employee turnover sends negative signals to remaining workers including new hires, indicating that the company isn’t worth their time and effort. These signals could harm employee morale and stifle confidence in the business. Before long, you can find your new hires joining the resignation queue with no one left to pick up the load.
Loss of Knowledge and Skill
When employees resign, they not only leave with, but create a knowledge and skills gap that hurts company efficiency. Leaving no guarantee new recruits will exhibit similar or increased aptitude than previous staff.
Employee Burnout
While companies go on a recruiting spree to bring in more employees, the remaining staff has to assume extra responsibilities. Some could take on as many as three different roles that might not come with the requisite compensation. Even if they do reap some financial gains, it still isn't a panacea in protecting them from burning out which ultimately affects the quality of their output.
How Do You Reduce Employee Attrition?
To reduce attrition, businesses need to identify the exact causes and map out the right strategies. So, if the issue is bad compensation, the company can put in measures to pay workers better. If employees feel undervalued, management can improve their relationship with their subordinates to foster unity and a sense of belonging.
Also, introducing clear career development paths and transparent promotion processes would improve employee retention. Providing a hybrid work environment that allows employees to work from home could improve morale and efficiency at the workplace.
But there’s a problem. How do businesses know the exact cause of attrition? There could be a million reasons why staff are deserting their posts. So, the go-to method for every company is to conduct surveys to measure employee sentiments and proffer solutions. Though that methodology has worked (and has its flaws), there’s a better solution, check out Worksense.
