How To Keep Employees: Employee Retention Strategies & Ideas

When it comes to talent retention, satisfied and engaged employees tend to stay in their jobs longer. If you've experienced retention challenges, or you'd like to lower your employee attrition rate, it may be time to implement changes in the workplace. About 53% of leaders say attracting talent, total rewards, and offering competitive compensation and benefits are top HR challenges for the next 12 months, according to our 2024 Priorities for Business Leaders report.¹

Developing or updating your retention strategies can help you find ways to encourage employees to stay with the organization rather than looking elsewhere for new career opportunities.

What Is Employee Retention?

Employee retention measures often focus on how long employees stay with your company. As they gain tenure, many of your people will continue to develop, using their acquired knowledge and skills to make meaningful contributions. Most companies review employee retention trends and when changes occur, they try to determine why.

There are a variety of factors that may influence an employee's decision whether to stay with an organization. However, there are strategies you and your HR team can implement to improve employee retention.

What Is an Employee Retention Strategy?

An employee retention strategy is a coordinated effort designed to increase worker satisfaction and limit employee turnover. Retention strategies help companies maximize their investment in their employees and reduce the costs related to hiring, training, and developing new workers.

Why Is Employee Retention Important for an Organization?

Employee retention is important because it can help maintain a base of knowledge and skills throughout a company and may ultimately provide the best service to customers while maximizing productivity. Alternatively, constant turnover can lead to the disruption of operational and administrative processes within an organization. Replacing an employee can be expensive and result in loss of institutional knowledge. When managerial resources are shifted toward hiring and training new employees, other strategic company goals related to growth or improvement may be upended. Recognizing the benefits of improving employee retention strategies, including career advancement and development programs, can increase employee engagement and increase their happiness at work.

Why Do Employees Leave?

Losing a valuable employee can have a negative impact on the organization. Other employees may be required to pick up the extra work until a replacement is found, which can ripple into feelings of resentment and anxiety for staff. The departure may also spark uncertainty and doubt among other staff members regarding their own sense of security within the organization. There are many reasons for employee departures, and understanding why individuals leave is key to helping others stay. Chances are high that an exit interview may reveal one or more of the following concerns:

• Lack of adequate employee benefits.
• Stagnant wages or inadequate compensation.
• Limited path forward for advancement and career growth.
• Unhappiness with management or coworkers.
• Feeling unappreciated and a lack of recognition.
• Dissatisfaction with the company's health, direction, or culture.
• Boredom, or feeling stuck or overlooked.
• Job role isn't as expected.
• Seeking an improved work-life balance.
• Desire to make a change.

It's impossible to fully eliminate employee attrition, but you can encourage workers to stay by focusing on staff retention and its advantages.

What Are the 3 Rs of Employee Retention?

To retain great employees, leaders can focus on three key strategies: respect, recognition, and reward. Respect involves respecting employees' ideas and beliefs. Recognition should be given regularly, not just at the end of the year, and can be done through one-on-one interactions, public recognition, or technology, depending on individual employee preferences. Finally, reward employees both monetarily and socially to motivate and recognize their efforts toward the success of your business.

10 Employee Retention Strategies

Before you can begin to develop new strategies, you'll need to understand how to retain employees by discovering what they like — and dislike — about their jobs. The opportunity to perform meaningful work is one reason why employees stay at their company, along with job stability and other factors. For each organization, there may be a unique mix of other factors that employees appreciate such as: a welcoming, inclusive work environment; flexible scheduling; or strong company leadership with a clear vision for success. Retention strategies should take advantage of the company's strengths while also improving upon current efforts that may be worth reevaluating. Here’s some suggestions for employee retention:

1. Invest in Training and Development

About 54% of business leaders and HR managers say career planning and skill-building are top priorities for the next 12 months.¹ In addition to the initial investment required to recruit and onboard an employee, companies should also consider prioritizing employee career development when managing long-term worker retention.

To make sure employees have access to training, employers can use a learning management system, along with live training and development sessions. Managers can work with employees to develop an intended career path and set expectations about what they must accomplish to get promoted or move to another position.

2. Provide Mentorship Opportunities

About 41% of employees said they are considering leaving their current company to increase their opportunities for career progression.² Mentorship programs allow employees to build a relationship with someone who can offer career advice and guidance. Companies can set up formal or informal mentorship programs to connect employees who would benefit from this type of business relationship. When employees join the company, they can be paired with someone as part of the onboarding process. This gives the new hire another resource other than their direct manager who may answer questions or listen to concerns. Mentors can also offer broader, long-term guidance related to professional development, while a direct manager may focus more on the employee's current role.

3. Benchmark Compensation and Benefits

About 84% of employees say they’ll stay with a company that supports their benefits needs.³ But even the happiest worker may look for other opportunities if they believe they are underpaid. Use industry data to compare your salary and benefits packages. Analyze benefits usage to find out which programs employees value. If you must pay employees below the industry average, you may be able to make up the difference by offering unique benefits or a flexible schedule.

It’s crucial to analyze the market and ensure you’re providing competitive benefits. Our research found the top benefits business leaders plan to use to improve retention are life insurance (36%), health insurance (36%), and retirement plans (24%).¹

4. Give Employees Autonomy in the Workplace

Top employees want to contribute and help your business succeed. To keep them engaged and satisfied, find ways to give employees ownership over their work. You may be able to let them decide how they can best do aspects of their job, with the proper amount of supervision. Encourage employees to suggest their own solutions to problems they encounter. Allow them to recommend changes to processes in the hope of finding efficiencies.

For employees who want to advance into a managerial role, look for chances to provide them with leadership opportunities. As they take on added responsibility, let them take the lead on certain projects, or serve as a liaison between your department and management. When employees speak up and offer solutions or advice, take their feedback seriously and provide thoughtful responses.

5. Create a Strong Company Culture

Many retention strategies for employees can also help to reinforce a company's culture. Employees want to know who they're working for. A strong company culture brings your vision for your company to life. Focus on cultivating a company culture that supports your ultimate goals. Employees who understand your vision for success and how the company interacts with its customers and community may be more engaged and better equipped to contribute over the long term.

6. Find New Ways to Encourage Wellness and Work/Life Balance

As the work environment continues to shift, find new ways to support employee well-being. Whether employees are working remotely, in the office, or on a hybrid schedule, they will no doubt face challenges to maintaining work/life balance. Talent retention ideas to consider may include offering mental health services, flexible hours, or wellness programs to help employees avoid the dreaded burnout that might cause them to seek a career change.

7. Celebrate Achievements

Employees want to be recognized for their hard work. Even small gifts or awards can go a long way as a sign of appreciation for their efforts. Think of employee recognition on a spectrum, from casual compliments at a staff meeting to formal award ceremonies. Find out what type of recognition your employees value most — it could be a small cash bonus, an extra day off, or public acknowledgement of their achievements. Structure a recognition program that will achieve the maximum results on a cost-efficient basis. You may not need to throw large company-wide parties when a small departmental recognition budget could allow managers to determine what works best for their team.

8. Ask for Feedback

Sometimes you don't know an employee is unhappy until they leave the company. Exit interviews can provide information about why employees leave, but you can also take steps to uncover this information and fix issues before someone hands in their resignation. Employee surveys can help to gauge overall job satisfaction. You can also conduct stay interviews with targeted employees to make sure they're happy with their current job role. Use the feedback to help shape future retention strategies.

9. Know the Importance of Flexibility

Acknowledging employees’ lives outside the company and being in tune with what matters most for their life and career goals will go a long way in aiding retention. For example, consider a flexible work model that allows for fixed and/or hybrid work schedules to better accommodate telecommuting options and a work-life balance.

10. Provide Wellness Offerings

Our research found two in five employees are experiencing some combination of mental health concerns, performance issues, and stress.⁴ Many employers focus on retaining employees by prioritizing their employees’ wellbeing. You can do this by promoting a healthy work-life through wellness programs like challenges, classes, or incentives encouraging employee health.

10 Additional Ideas for Improving Employee Retention

If you want to improve employee retention, it’s essential to make sure your employees are happy and engaged. Some companies enhance their employees’ satisfaction by implementing flexible hours, work-from-home options, retirement saving plans, and casual dress policies. There are also uncommon ways to boost workforce engagement. Here are 10 creative ways to retain employees:

1. Encourage managers to handwrite thank-you notes to staff for performance or thoughtful workplace acts.
2. Provide paid time off to participate in volunteer work.
3. Form workplace teams for softball, volleyball, trivia contests, bowling, etc., and hold tournaments.
4. Organize an annual staff talent show.
5. Offer virtual lunchtime yoga classes, weight loss groups, and/or brown-bag lunches with educational speakers.
6. Obtain discounts from local merchants, such as health clubs, parking lots, or office supply stores.
7. Allow workers the day off on their birthdays, or the option of a floating holiday.
8. Set up a fitness room with weights and exercise equipment.
9. Help employees offset the costs of childcare, family care, and even pet care.
10. Organize short exercise breaks, such as 15-minute walks.

The size of your company, your corporate culture, and your budget will determine employment retention strategies in the workplace. But never let creativity be the limiting factor.

Continue Learning About Employee Retention

Employee retention rates may change over time as the economy and workplace demographics shift. Make sure your employee retention ideas continue to evolve as well, or you may risk losing talent to competitors who can quickly capitalize on the latest workplace trends.

Paychex can help you hire, retain, and develop talent from a single HR platform. We’re here to help you work toward the long-term success of your organization by helping you craft impactful hiring and retention strategies.

¹ 2024 Priorities for Business Leaders, Paychex

² 2022 U.S. research of 606 full and part-time employees, Paychex

³ 2020 Employee Benefits Study, Paychex

⁴ 2020 State of Mental Health in the Workplace Survey, Paychex