Why Can Low Staff Retention Impact Your Business?

Staff retention is at an all-time low. The pandemic led to thousands of resignations and early retirements and now there are more jobs going than people who are looking. There are a lot of reasons for this, including the shift to working from home leading to an increased demand for it, and the entrance of Gen Z into the workplace, who on average have higher expectations for first-time jobs, to the emerging discourse on the 4-day working week, flexible hours, and general higher standards for the workplace. In the meantime, many people simply opt out.

If you have a problem retaining staff, you’ll likely notice an impact on your bottom line. It takes time and money to replace the same job role over and over again. You waste countless hours going over old ground with a new person, and in doing so, productivity in other areas of your business takes a nosedive.

Another problem with low staff retention is the impact it will have on general morale in the workplace. Employees notice when their colleagues leave frequently, and not only do they often lose a workplace friend that they like to interact with, which often helps to lessen the tedium of some regular tasks, but they lose faith in the reasons that they themselves are staying in their job. Maybe that good salary isn’t that good after all, or maybe the long hours aren’t as typical as they appear.

There’s also the impact that suddenly losing a team member has on the workload of everyone else in the company, which is likely to increase by a significant amount, and will stay higher than it should be, not just until a replacement is found but until that replacement is sufficiently trained up and able to take on the full workload of the previous worker. Team members who are picking up the slack and filling in gaps where another employee used to be will often see their own work start to suffer and their focus decrease.

Once remaining employees start to seriously consider their other options, you’ll likely see a serious drop in productivity as attention wanders and motivation wanes. Team members who have become disengaged with their role and the company are likely to perform badly and be non-responsive to constructive feedback.

In summary, it’s best to avoid high turnover as much as you can. As a business owner you are worried about your yearly turnover, but long-term investments in things such as flexible hours and competitive pay can pay off in better peace of mind and far less stress.

Contact Headway today to find out more about hiring temporary staff to fill those vacancies, whilst you work out a longer-term strategy to improve staff retention.