1.000.000.000.000 USD
That's what U.S. businesses are losing every year due to voluntary turnover. And the most astounding part is that most of this damage is self-inflicted.
The cost of replacing an individual employee can range from one-half to two times the employee's annual salary -- and that's a conservative estimate.
The annual overall turnover rate in the U.S. in 2017 was 26.3%, based on the Bureau of Labor Statistics.
So, a 100-person organization that provides an average salary of $50,000 could have turnover and replacement costs of approximately $660,000 to $2.6 million per year.
In the United States, it takes an average of 42 days to fill an open position. Once an ideal candidate is hired, it takes six to eight months to reach full productivity
What can you do to reduce turnover?
Highly engaged employees are 87% less likely to leave.
The No. 1 reason employees leave is lack of growth and development opportunities.
Some 94% of those surveyed said they would stay at a company longer if that company demonstrated a commitment to helping them learn.
Salary and total rewards are still a crucial part of employee retention. However, recognition also plays a big role in retention.
Some 68% of staffers said their organization's recognition program positively affects retention.
58% of employees would consider changing jobs for increased pay transparency.
How can you increase employee engagement?
Illusory superiority (social psychology, Van Yperen and Buunk, in 1991) -
a condition of cognitive bias wherein a person overestimates their own qualities and abilities, in relation to the same qualities and abilities of other people
In a survey of faculty at the University of Nebraska-Lincoln, 68% rated themselves in the top 25% for teaching ability, and 94% rated themselves as above average.
In a similar survey, 87% of Master of Business Administration students at Stanford University rated their academic performance as above the median.
Svenson (1981) surveyed 161 students in Sweden and the United States, asking them to compare their driving skills and safety to other people's.
For driving skills, 93% of the U.S. sample and 69% of the Swedish sample put themselves in the top 50%;
For safety, 88% of the U.S. and 77% of the Swedish put themselves in the top 50%.
How can you overcome the “Illusory superiority” condition and implement performance appraisals that are considered fair by employees?
Company culture can impact sales, profits, recruiting efforts and employee morale, whether positively or negatively.
It can inspire employees to be more productive and positive at work while reducing turnover.
It can even act as your best recruiter, attracting qualified candidates who want to work for your company.
In a strong culture, employees feel valued. They enjoy at least some control over their jobs, instead of feeling powerless.
Strong company cultures also give employees opportunities to grow. Offering promotions, career development programs or extra training can keep employees motivated - which in turn, improves performance.
How can you improve drastically your company culture?