7 Useful Tips to Reduce Employee Turnover

by Srikant Chellappa Mar 8,2022

The People Strategy Leaders Podcast

with Srikant Chellappa, CEO

Facing challenges with employee retention is no doubt one of the common things that human resource departments face. Every company should focus on keeping turnover at a minimum. As per reports on truth and trends in turnover, one out of four employees will quit their present job, looking for other better opportunities. But it is believed that strategic approach of employers can retain almost 77 percent of employees who quit. The factors on which healthy turnover depends varies widely from one industry to another. The trend of turnover, its root causes and working on it for better results in future can help to reduce employee turnover for an organization.

What does employee turnover stand for?

Employee turnover shows the total employees who leave a company over a specific time. It includes both retired employees and those who are fired from the organization. No matter what the reason for turnover may be, absence takes a toll on a company’s profit margins. However, turnover also applies to subcategories, such as within demographic groups or departments. Losing talent impacts productivity. 

Turnover majorly impacts an organization’s trajectory. This is a common problem in all organizations and they wonder how to deal with it. The turnover can be voluntary or involuntary, quarterly or annual, depending on industry or when an employee gets terminated from organization. However, it can become costly due to the following:

  • Lower productivity level when looking for a replacement
  • Overhead related to posting for job and hiring procedure
  • Planning for training programs for new hires
Also read: 10 Best Employee Feedback Tools To Track Performance

Turnover rate can impact your relationship with industry and customers. Some have a high rate of turnover due to the category of industry and nature of work. An excessive turnover is a warning sign to maintain good company culture and retain a prominent position in the market.    

An organization has to plan for effective strategies that help boost retention and eventually can avoid high turnover. Reports show that US employees have paid $600 billion as turnover cost in 2018, that increased to $680 in 2020. Here, one should learn more about current market trends of hiring labor, the employment phase and its rate. This will help the employers come up with suitable strategies for hiring talents and retaining them for the good of the company.     

Useful tips to reduce turnover 

  1. Define company culture to hire right talents

Hire the right person to begin with and let the person be aware of the company culture. This helps an employee understand whether they fit into workplace culture and what they can expect from it. The role of the candidate should be well defined to both the candidate and the person assigning it for clarification. It helps the management to make sure that they hire the right talents for the vacant job positions.

One effective strategy can be allowing peers in a particular role to hire another for the same position. This is how the person already serving the organization can analyze the skill of the new person to hire and can hire the ideal fit for a position. The existing person can evaluate the person to hire better and whether they would match with the company culture.   

  1. Allocation of the right team for right job

Smooth onboarding can help. Deploying the right team for the right job can make a difference in how the task is done. The strategy and skill of the team will help achieve it right on time. When a team is hired, it should have members with mixed qualities, as arranging for day-to-day tasks and handling each can be challenging. To make it smooth, assign different tasks to everyone. This will also make an individual stable in their specific role and hone skills better for future endeavors.  

  1. Encourage gratitude and generosity

Recognize the contribution of every individual in a team. It turns out to be an incredible element in boosting working relationships with employees. Try to encourage social interaction among employees and every opportunity can lead to better connection and appreciation among the team. It will surely make employees healthier and they would be happy to put in their best.  

Transparency in company policy is important for a healthy work culture. This helps to gain trust of the employees and the company can get the best out of the workforce. Introduction of performance linked incentive further encourages employees to work to their full potential and their sense of belongingness to the organization bolsters productivity.

Also read: Gratitude Is A Part Of Employee Recognition Too
  1. Recognize efforts and reward employees

Rewards and recognition are meaningful, and the best and cost-effective method to prevent turnover. By this, it can boost productivity and encourage a happy environment in the workplace.

The nature of employee recognition can be personal, specific, unexpected, and frequent. Overloading a team is never the best solution. A missing work-life balance can result in higher turnover, something that is not desirable. Some simple ways of appreciation that companies can benefit from are:

  •       Praising in public
  •       Giving paid time off from the work
  •       Feature employees and achievements on company website
  •       Sending appreciation email to boost up employee
  •       Offering a reward or announcing the person as an employee of the month

These are sure to encourage an employee to put in their best effort. It is something that the company will surely benefit from. The recognition has to be fruitful for employees and eventually they feel valued for the effort they give in for organization.    

  1. Check with employees about achieving goals

Encouraging employee growth helps retain talent. Employees want to grow constantly, which is good for the organization and should help them achieve their goals faster. If you stifle the motivation of employees to achieve the best, it can lead to stagnant growth or chances of turnover. Try to introduce opportunities that help in constant skill development and help them make a place among the top-performers.   

Also read: 7 Reasons Why Goal Setting Is Important
  1. Give importance to work-life balance

The demand for work-life balance among employees has become increasingly important. Companies need to be attentive to this balance to reduce turnover and offer a flexible workplace for employees. Businesses need to prioritize communication, introduce flexible working hours, and offer employees on-site childcare if they want to promote a work-life balance. 

Coherent teams boost better communication, lowers the stress level, resulting in greater output. This will automatically enhance the retention level of employees, and cut on the chance of turnover rate.

  1. Training programs reduce chance of turnover

It is important to train employees to help them understand core values of business and give adequate assistance they require to thrive in the first weeks of joining the company. The training program will help them come to terms with tools used, context and knowledge required to solve the challenge they come across in the future.

Try to include one-to-one interaction sessions as it helps understand what the employees are looking for and what can improve their contribution to the company. Through team-building activities, help each of them identify strengths and work on their weaknesses. This is how you can identify and prevent a situation of turnover. Employees would feel valued when they find an organization investing in training programs to help individuals perform well.

Companies need success and a good profitability rate to thrive and remain constant in this ever-changing market. Employees are the success drivers for organizations. The culture is becoming employee-centric and so the organization needs to ensure that it offers an optimistic environment to retain top performers. Try to adopt strategies that retain the valued talent in the firm for best results.  

How to measure the success of an organization in lowering employee turnover?

Maintaining an optimum workforce such that productivity level is maintained at a desired level is an important aspect of running an organization. It is decided by employee turnover and attrition. 

Employee attrition is the natural reduction in the number of employees through retirement or resignation or death. As we can see, there is little that a company can do to reduce attrition. However, as a counter step, it can hire new employees to fill up the vacant positions. 

Turnover means the number of employees leaving the company voluntarily as well as involuntarily. While we have no control over the group of people who retire or are terminated by the company, we can focus on the number of people who are resigning. Scheduling exit interviews can help the company to find the reason. When the voluntary exit levels are high, a company may evaluate its working environment, culture and choose to bring about necessary changes based on feedback of leaving employees. We can say, employee turnover is a metric for job satisfaction of employees. A successful company must strive to keep its turnover rate low.

Discussing the turnover rate, it can be concluded that it is concerned about the internal culture of a workplace. It is also the frequency of employee hiring, quitting the job, and how an employee is fired. In other words, it is measuring staff turnover. Turnover is mainly on employees who are leaving on their own terms, including the one who receives termination. However, the turnover rate also helps measure an employee’s lifecycle.   

Difference between healthy and unhealthy turnover

After going through the difference, you may think that optimal turnover should be lower. However, some turnovers are considered to be healthy for an organization.

In this regard, when an employee is about to retire after serving for so long, the turnover will make space for a new talent. There can be employees who wish to change the organization before they attain the frustration and stagnation level. It is both a natural and healthy form of turnover for an organization.   

However, the rate of turnover often depends on the industry and it has to be a healthy one for the company. Transforming the workplace can reduce turnover and, in this, hospitality experiences a higher rate than others due to its nature of work(Source).   

Transforming workplace can reduce turnover

Try to make the workplace a positive environment and interesting to work in and this can effectively reduce the chance of turnover. Employees should feel like that company values them and understands their needs. For this, the workplace should focus on employees and make the best of decisions to retain crucial talent. The more employees are interested in working in the place, the higher is the retention rate, thus, lowering the turnover.   

Also read: Leadership In Times Of Crisis:How To Lead Efficiently


The employee turnover directly impacts on company profitability. An employee with the right skills can assist in making effective business decisions. Here’s where selecting the right employee becomes challenging.

Once a business can find the right person, getting them to give their best for the team can be time-consuming and costly. It sometimes takes longer to hire employees and so organizations are offering high pay for salaried ones and also paying for the hourly roles. These are some forms of better incentive rates that cut on the turnover rate. Create development opportunities and prioritize employee needs as it helps reduce the chance of turnover.

Want to know how Engagedly can help you manage your employees better? Request us for a demo.

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Srikant Chellappa
CEO & Co-Founder of Engagedly

Srikant Chellappa is the Co-Founder and CEO at Engagedly and is a passionate entrepreneur and people leader. He is an author, producer/director of 6 feature films, a music album with his band Manchester Underground, and is the host of The People Strategy Leaders Podcast. He is currently working on his next book, Ikigai at the Workplace, which is slated for release in the fall of 2024.

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