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What is employee retention?
Employee retention refers to a company’s ability to keep their valuable talent. Replacing a position can cost up to twice the employee’s annual salary, emphasizing the importance of investing in employee retention strategies.
According to SHRM, in November of last year, resignation statistics rose to 4.5 million in the U.S. alone. To avoid losing your top talent and improve employee retention, your company must implement strategies that enhance work culture, including employee engagement, productivity, and satisfaction.
5 employee retention strategies for tech companies
Your company’s human resources team is most familiar with your employees’ skills, needs, and expectations and should, therefore, play a major role in executing your retention plan. Here are five top talent retention strategies to include in your plan:
1. Invest in employee engagement:
The tech industry is one of the most competitive, so employee turnover may become an issue without implementing strategies to keep employees engaged. High levels of employee engagement mean team members feel that they are a fundamental part of the company, and that they understand and are working to meet the company’s goals. In fact, according to Deloitte’s Talent 2020 survey, a mere 15 percent improvement in engagement can lead to a 2 percent increase in profit margins.
Employee retention in tech companies is on the rise due to the competitive benefits the industry is known for offering, which can range from unlimited vacation days to modern offices and discounts at the best restaurants. These unique perks help keep employees happy and engaged. In addition to providing attractive benefits packages and perks, there are simple, day-to-day actions you can take to improve employee engagement, including:
- Ask your employees what they need to feel happier at work and how, if given the chance, they would better the company to highlight actionable steps for organizational improvement. Employee surveys are a great way to do this.
- Provide feedback to your teams through regular informal meetings and more structured quarterly feedback sessions.
- Encourage your employees to share ideas and ways to innovate through frequent brainstorming sessions and by fostering an open-door management policy.
However, listening is just the first step — ensure you show your employees that their voices have been heard through actions like providing status updates on feedback implementation progress.
2. Prioritize professional development
Investing in the career and skills development of your talent is one way to ensure a profitable future in the long run. According to a study conducted by Degreed, 46 percent of the responding professionals agreed they are more likely to leave their company if they do not see a commitment to upskilling and reskilling, resulting in costly turnover.
Offering internal trainings, access to collaborative learning opportunities, educational resources, or the option to attend external courses will ensure your teams feel supported and that they have the skills and certifications to contribute to your company’s success. Another professional development opportunity many companies offer their employees is tuition reimbursement. It may seem like a big investment upfront, but in the long term, your employees will gain the skills required to test new markets, develop new products or services, and help you beat out the competition.
3. Implement internal recognition programs
There is a strong connection between talent retention and employee recognition. In fact, Deloitte found that leadership support and recognition are among the top three most effective nonfinancial factors for retention.
Another recent survey showed that 82 percent of responding American employees feel happier at work when they are recognized. Additionally, 63 percent of employees who feel recognized said they’re “unlikely” to look for a new job.
Employee recognition can result in many additional benefits related to retention, including:
- Promoting a healthy work culture
- Increasing customer satisfaction
- Maintaining employee motivation
- Strengthening employees’ relationships with their work team
- Reducing dependence on managers
4. Foster a culture of diversity and inclusion
Diversity in the workplace is increasingly important to employees, especially those in the tech industry. According to Built In, 3 out of 4 employees prefer to work at companies that are diverse, giving employers that prioritize diversity a significant advantage over the competition. Unfortunately, the tech industry has a long road ahead in terms of diversifying their teams. In fact, according to Zippia, men currently hold 75 percent of tech jobs in the U.S.
Looking beyond race, language, and gender ensures employees are treated equally and that employers have access to the best talent. Diversity also leads to inclusiveness and greater satisfaction within teams.
5. Offer flexibility around working schedules and location
Top talent in today’s tech industry expects more than just the ability to work remotely — they are looking for flexible work arrangements that ensure a better work-life balance. Ninety-two percent of the tech companies surveyed by the Consumer Technology Association indicated that providing flexible work arrangements, such as scheduling and freedom of location, is crucial for retaining employees.
A few ways that flexible working arrangements can help increase retention include:
- Increased employee loyalty
- Attractive brand and company culture
- Reduced stress within teams
- Better work-life balance
How to calculate employee retention
How can you ensure your talent retention strategies are working? Employee retention is better measured if you calculate it on an annual basis and only include employees who have been working with your company throughout the entire year. According to SHRM, one formula works best:
(# of individual employees who remained employed for entire measurement period) /
(# of employees at start of measurement period) x 100
Now that you know which retention strategies to implement and how to measure your success, it’s important to remember that significant changes are made with small daily actions.
As you work to keep your top talent and enhance employee retention strategies, leverage Globalization Partners’ AI-driven Global Employment Platform™ to streamline everything from recruiting and onboarding to managing your teams across the world — all while mitigating cost and risk. We take care of the administrative and compliance burden throughout your global growth journey, so you can focus on what matters most: your people.
Reach out to us and we will help you hire anyone, anywhere!
- Want more tips on employee retention? Check out our latest piece: 6 Strategies to Boost International Employee Retention
- Need to strengthen your strategy to recruit and hire tech talent? Don’t miss this piece: Recruiting and Hiring for Tech Positions
For more on this topic, check out our Infographic: Rally for Retention: Retain Your Top Global Talent