Hiring and keeping the right employees is top of mind in nearly every industry these days. But none more so than the retail sector where according to a 2021 Bureau of Labor and Statistics (BLS) report the turnover rate is currently around 60 percent, which is more than three times the all-industry average. The retail workforce is unique in the fact that it encompasses part-time retail employees, full-time management and head office employees, contract distribution channel workers, and everything in between. Minimizing turnover across all of these departments is an important part of the equation that keeps your operation running smoothly.
There are a lot of factors that lead to retail employee turnover, and some retail managers tend to view turnover as a necessary evil of operating in the industry. But, where there are problems, there are solutions. Let’s dive in look over nine tactics to help you decrease retail employee turnover.
The High Impact of High Turnover
Having a consistently high employee turnover rate at your company can have a significant impact on your business and your bottom line in various ways:
Decrease in Employee Morale
Increased employee turnover can have a negative impact on those who stay behind and as turnover increases, it’s not uncommon to see morale among a workforce drop. Existing staff may have increased workloads and responsibilities due to a lack of a trained workforce leading to faster burnout. Turnover can also lead to a dip in trust in the company’s management particularly when a large number of employees leave the company in a short time frame.
Increase in Cost of Operations
The impact of high staff turnover includes decreased productivity, increased recruitment costs, avoidable time spent on training new employees, and a potential loss of sales. According to The Center for American Progress, the typical cost of turnover for positions earning less than $30,000 annually is $4,800 or 16 percent of an employee’s annual salary. This cost includes everything from the price of advertising a job opening and running a background check to all of the work hours invested in each step of the hiring process. That’s nearly five grand every time an employee is lost. And it doesn’t cover the tangibles and intangibles of onboarding such as getting a new hire comfortable in their new position and with their new team.
Recruiting for retention begins long before an applicant applies, let’s take a look at some ways to reduce turnover during the awareness, consideration and interest stages of the recruitment funnel.
1. Utilize Employer Branding
Employer branding is the story you tell potential employees about what working for your company could be like. Utilize employer branding to show prospective talent your unique employee value proposition and encourage interest among your ideal candidate persona. Read more about it in this related article:
2. Optimize Sourcing
The talent that enters the recruitment funnel will ultimately determine the quality of employees your company hires. If you’ve used strong employer branding, the talent that enters into the consideration phase is more likely to be the right kind of talent. The next step is to dive into the data to determine what sources are producing the best candidates. Ask yourself, what sourcing method are most new hires coming from? When looking at turnover, are candidates from a specific source more likely to stay than others? By collecting data on hiring and retention outcomes, you’ll be able to see which source is bringing you the best talent, or the talent most likely to stay — allowing you to increase your sourcing from those channels. Keep an eye out for our next article, where we’ll talk in-depth about the data behind conversion-based recruitment marketing.
3. Improve Follow-up Communication and Feedback
Particularly in the retail sector, hiring the best talent often comes down to competition between your company and others who are hiring in the same market. Prompt and consistent follow-up is the perfect way to stand out from your competitors as the top choice and can make a huge difference in your ability to claim top talent. If you want to dig deeper into how to improve follow-up in your organization check this article out.
Now that you’ve made it through the hiring process with a pipeline filled with top talent that has the potential for longevity, let’s take a look at how you can improve your chances of retaining these new hires.
4. Onboard Smarter
An effective onboarding program can not only allow new hires to reach their full productivity, faster but it can also help you develop more top performers with staying power. In fact, according to SHRM, 69% of new employees who experience a good onboarding program are more likely to stay longer. So why then does the average retail employee spends their first few days behind a computer being inundated with easily forgotten information? Better retail onboarding should include delivering the most relevant information and critical job elements in bite-size learning while offering associates time to put new learning into immediate practice. According to the Aberdeen Group, 86% of new hires decide to stay or leave a company within their first six months. Successful onboarding can help you reduce the risk of turnover, as well as reduce any potential costs associated with employee errors due caused by lack of training.
5. Offer Better Training
Training and onboarding are two faces of the same coin, and they go hand in hand. If your goal is to seamlessly integrate new employees into your stores, they need to be equipped with the tools and knowledge to succeed in the role. Another report from the Aberdeen Group showed that 89% of new hires say they don’t have the optimum level of knowledge necessary to do their job. How does that link to retention? Employees who feel they’ve been equipped with propper training feel less frustration in completing expected tasks. This also makes them feel more capable of handling the type of difficult situations that may otherwise cause someone to decide they aren’t caple of doing the role.
6. Manage Expectations
In this sector, there is a high availability of openings and a low number of candidates vying for the roles. This means that there are fewer barriers to both entry and exit. One of the primary contributors to voluntary attrition (ie, candidates opting to quit), particularly within the first 30 or 90 days of employment, is misaligned expectations. If a candidate begins work, and the job isn’t quite what they expected, they can most likely find a new position with relative ease. So, how can you solve this? By consistently setting expectations for every applicant in a transparent and engaging manner.
At this point, a candidate has successfully made it through the hiring process, as well as your stellar onboarding program. Now the question becomes, how do help to ensure that top talent stays?
7. Money Talks
During a recent survey, we asked what factors were most important to job satisfaction. Money was of course the number one factor, though it wasn’t the only one. Not every company can afford to increase pay scales across the board, but it is important that you are offering the most competitive wage possible. If you’d like to explore what other factors ranked in employee satisfaction, check out our on-demand webinar below.
8. Recognize and Reward
Few things will push a top performer out the door faster than feeling like they are unappreciated or disposable. According to FastCompany, employees are 12% more productive when they’re happy, and they’re happier when they’re recognized for the job they do. In addition to that, a past study by global analytics firm, Gallup says that employees who don’t receive adequate recognition are twice as likely to quit in the next year. Create initiatives within your company that serve to let quality employees know that you recognize their contributions and are willing to reward them for their skills or performance.
9. Offer Growth
Generally speaking, people aspire to be more tomorrow than they are today. Employees want to increase their skills and knowledge base to move up the career ladder. If they stay stagnate in one position for too long, it’s likely that they will begin searching for another job where they can find advancement. Employees place huge value on opportunities for growth. Our recent hourly candidate survey revealed that over 38% of hourly candidates view development as a key factor in job satisfaction. Capitalize on that statistic by showing top performers a clear path for advancement to turn a retail job into a rewarding, long-term career.
Good Retention Starts With Quality Hires
Here at Work4, we’ve helped organizations around the globe to create efficient volume hiring processes that help them hire and retain top talent. From employer branding to quality lead sourcing at scale, we have a product that’s right for your company. Before you can retain top talent, you first need to attract top talent. Contact the experts at Work4 to see what solution works best for you. Click the link below to schedule a meeting with our team.