How to Reduce Employee Turnover

Reducing employee turnover is essential for maintaining a stable and productive workforce in any service business. High turnover can be costly in terms of recruitment, training, and lost productivity and can also affect your customer’s experience. This is particularly important in service industries where an ongoing relationship with the same provider is important, such as home healthcare, education, and cleaning.

With that in mind, here are nine strategies to help reduce employee turnover:

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1. Invest time and resources into improving employee onboarding and ongoing training

One of the best ways to reduce employee turnover is to ensure all service providers have the knowledge and skills to do their job from day one. This enables them to settle into their role quickly and improves employee satisfaction as they’re not starting on the back foot. 

Devise a thorough onboarding process and provide ongoing training and development opportunities to help new employees grow. 

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2. Offer competitive compensation and benefit packages

Higher wages and more development opportunities are two main reasons an employee leaves a company. Therefore, it’s essential to ensure that your compensation packages are competitive within your industry and region. 

Employees who job-hop can expect salary increases of up to 30% over time, so to reduce employee turnover, don’t penalize people for staying!

In addition to salaries, your employee benefits package should meet (or ideally exceed) industry standards if you want to attract and retain quality employees.

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3. Implement systems to recognize top-performing employees 

To reduce employee turnover in any service-based business, it’s important to recognize and reward the people who are the face of your organization. Acknowledging and rewarding employees who have gone above and beyond, get glowing client reviews, or consistently come out on top improves employee satisfaction. And to paraphrase Elle Woods, happy employees just don’t quit their jobs!

As an added benefit, performance-based reward systems incentivize employees to excel, positively impacting productivity and customer satisfaction.  

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4. Help employees maintain a good work-life balance

Flexible work arrangements, respecting employees’ personal time, and encouraging staff to take their allotted vacation time all lead to a better work-life balance that can reduce employee turnover. 

It’s also important to avoid overloading employees with too many jobs and clients, which can quickly lead to burnout. The easiest way to avoid this is to implement a scheduling software like MarketBox that will assign jobs to employees based on skills and availability to ensure providers are given jobs that fit their experience level and existing schedule. 

MarketBox also makes it easy for in-home and mobile service businesses (or their employees) to control when and where they operate with custom travel zones and personalized availability. To learn more about MarketBox, book an introductory call with the team. 

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5. Create a positive company culture 

Another effective way to reduce employee turnover is to create a positive company culture that makes employees feel valued and respected. 

Strategies to improve company culture include: 

• Introducing clear, open communication channels and creating an environment where employees feel comfortable sharing concerns and ideas. 
• Conducting regular one-on-one meetings and performance reviews to provide feedback and address issues early.
• Offering career advancement opportunities within the company to stop employees looking for them elsewhere.
• Organizing team-building activities and social events that match employee interests.
• Creating an inclusive workplace that values diversity and fosters a sense of belonging among employees.

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6. Conduct regular surveys and collect employee feedback

In addition to one-on-one meetings with employees, anonymous surveys are a great way to gather feedback and identify areas for improvement that can impact employee satisfaction. 

Service businesses should get into the habit of regularly collecting feedback and taking action on the concerns raised to reduce employee turnover. 

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7. Train managers to become good leaders

Effective leadership can have a positive impact on employee turnover. Therefore, service businesses need to ensure that any employee in a leadership role has the management skills to be an effective team leader. 

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8. Conduct exit interviews

Even after taking steps to reduce employee turnover, people will still leave as their circumstances change. When this happens, it’s important to conduct exit interviews with departing employees to understand their reasons for leaving. 

The information you gain from these conversations can be used to prevent similar issues in the future and identify improvements that will increase satisfaction in the rest of the team. 

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9. Hire the right people 

Another key strategy for reducing employee turnover that is often overlooked starts before the contract is signed.

Service businesses that ensure they hire candidates who are a good fit for the organization’s culture and values see less employee turnover in the long term. In order to achieve this, businesses need to first have a good understanding of what their values are and then work on developing an interview process that will highlight those traits in an individual. 

Depending on the industry, it may be helpful to include skills assessments or require specific qualifications as part of the industry process. 

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Final thoughts

Remember that reducing employee turnover is an ongoing effort that requires attention and a willingness to adapt as circumstances change. By prioritizing the well-being and development of your employees, you can create a workplace where people are more likely to stay and contribute to the success of your organization.

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