Even if you run your business as perfectly as possible, there will inevitably be some workers who will leave for new opportunities sooner or later. That’s just the way it goes.
But if your company is hemorrhaging workers on a routine basis, there’s a very serious problem. In fact, if it persists, high employee turnover can force your business into early retirement. Here’s why:
01. It destroys morale
When colleagues are jumping ship left and right, it’s not exactly inspiring for collective morale. The employees who stick around after their work friends have left likely won’t continue to produce at a high level. As a result, productivity suffers and even more employees become unhappy and disengaged.
02. It costs a lot of money to hire new employees
On average, it costs anywhere from $5,000 to $15,000 to replace an employee, according to figures from the Center for American Progress. When employees are leaving at a steady clip, those costs can quickly skyrocket. Few companies are able to afford to absorb all of the costs associated with finding replacement employees while still retaining their financial vitality.
03. New hires don’t produce at the same level
In a perfect world, new hires would be able to handle a full workload the first day they sat down at their desks. In reality, it takes time for them to ramp up. Even when you find the perfect candidate to replace an outgoing employee, that person isn’t going to be able to fill their shoes for quite some time. In the meantime, customer service and company-wide productivity will take a hit.
04. There’s a reason you have high turnover
When employees are constantly leaving, something is wrong — it’s that simple. You probably know what that something is. Unfortunately, thanks to employer-review sites like Glassdoor, the rest of the world will soon know too.
05. Top talent is finite
There are only so many talented workers in your geographical area. When your turnover rates are high and professionals start talking, your company could develop a bad reputation that may discourage many skilled candidates from applying for jobs there in the first place. Sure, you’ll always be able to find someone to fill a position. But if you want your company to continue to be a serious force in your industry, you only want to hire the best of the best.
If your company is experiencing high turnover and you don’t know why, it’s time to start investigating. Conduct exit interviews with your outgoing employees to find out why they’re leaving. Better yet, utilize pulse surveys that enable remaining members of your team to share their thoughts with you anonymously. That way, they won’t be afraid of any repercussions, so they will speak honestly and openly, ensuring you find out what’s going wrong. Armed with that information, you can take proactive steps to improve working conditions and solve your turnover problem before it’s too late.