Employee retention—an organization’s attempt to maintain its current workforce—should be the No. 1 priority of every small business. To do this, you must engage your employees, create a desirable company culture, and pay them a fair wage.
The following employee retention statistics can help your business retain your employees in a way that is beneficial to both the employee and your bottom line.
General Workforce Statistics
By knowing some key general employee retention metrics about today’s workforce, you can get a head start on employee retention. Our statistics show that the average turnover rate among employees in the US is more than half, which can be reduced by putting in place certain retention measures.
1. 3% of all workers quit their jobs in any given month
While this number may seem low, the United States saw its largest increase in employees who quit their jobs (4.4 million) in September 2021 compared to previous months. The industries that saw the greatest number of employees quitting their jobs included entertainment, recreation, and arts, followed by state and local governments. People leave their jobs for a variety of reasons, including a need for a better work-life balance, new career opportunities, and health and family reasons.
2. The average turnover rate in the US in 2020 was 57.3%
The average rate of turnover among all companies in the US sits at 57.3%. This means that more than half the workforce are either leaving their jobs and starting new ones or being terminated. This number was up 12 points over 2019, likely a result of COVID-19-related layoffs.
3. 72% of the professional workforce is currently working remotely
Due mostly to the pandemic, a large number of the current workforce is working remotely—72% of professional (white-collar) workers and 14% of blue-collar workers. In light of this research, offering remote work to your current employees can increase retention by giving them the freedom that others currently are experiencing.
4. Companies with a culture-based environment see up to a 72% decrease in employee attrition
A Gallup Poll showed that companies that focus on their culture achieve up to 29% higher profit, 19% higher sales, and a 72% lower attrition rate (the rate at which employees leave a company). A culture-rich work environment offers an exceptional employee experience where the employees are engaged and managers coach their employees to be their best selves. This results in higher productivity, performance, and retention.
5. The average hourly rate for employees has decreased by 1.2%
According to the Bureau of Labor Statistics (BLS), although wages are actually up 0.4%, the average hourly rate for all employees has seen a decline over the past year due to an increase in the consumer index. Low wages and increased prices on goods and services can make retaining your current employees difficult. Consider offering pay that is above the national average to help retain your current employees.
6. The highest turnover rate (at 33%) is among first-year employees
Employees in their first year on the job have a 33% turnover rate. This is higher than for tenured employees. The largest reasons for this are lack of interest in the job itself, lack of benefits, and the desire for a better work/life balance. You can decrease this statistic by creating a robust onboarding program that clearly spells out job duties, fully trains employees, and provides information surrounding provided benefits.
Retaining Your Current Employees
The stats below highlight more specific trends within your current workforce and how you can use this information to retain your current employees.
7. 60% of employees list learning new job-related skills and advancing their careers among their top priorities
Employees who learn new job skills and use these skills to advance their careers typically remain happy in their current employment. A survey shows that over half of all employees desire to learn and advance. Even more than that, 69% of Gen Z workers (those aged 16-24) believe learning is the key to a successful career.
8. Balancing work with their personal lives is important to 79% of the workforce
According to an employee well-being mindset study, when it comes to creating a desirable work environment, businesses that offer a good work/life balance rank among the top places to work. You can achieve this by allowing flexible schedules and creating a robust paid time off (PTO) policy.
9. 76% of workers want flexibility over where they work & 93% want flexibility over when they work
FutureForum (by Slack) reports that workers crave flexibility in their jobs. The majority want some type of remote work scenario—full-time remote or hybrid remote (two to three days in the office/two to three days from home). Additionally, they want flexibility around the hours they work. This could mean working from 7:30 p.m. to 4:30 p.m. or 9 a.m. to 6 p.m. instead of the traditional 8 a.m.–5 p.m. Creating a flexible work environment can lead to employee retention.
10. 57% of workers are open to looking for a new job
FutureForum also reports that your current employees may already be searching for new employment. The reason—better pay, benefits, flexible work environments, and the option to work remotely. This has been referred to as “The Great Resignation” and was prompted by the COVID-19 pandemic and changes in job requirements.
11. Job-related burnout is experienced by 74% of employees
According to a recent study, about three-fourths of your workforce is burnt out in their current roles. To reduce burnout in the workplace, employers should create an atmosphere that engages employees, promotes work/life balance, and builds upon the employees’ natural talents.
12. 70% of employees are highly engaged when they have a proactive manager
Employees whose direct managers are invested in their progress are engaged (70%) in their everyday roles. This means much more than just a manager who doles out tasks; it means a manager who trains, teaches, and is directly involved in the employee’s success with the company. A bad manager can lead to an employee’s decision to leave. A good manager contributes to employee retention.
13. Only 32% of employees are satisfied with their work
Only 32% of your employees are satisfied in their positions; the others are just “showing up” for work. This means the majority of your employees are less engaged and less productive than employees who are happy in their jobs. What can you do to change that? You can offer manager training and benefits and perks and give your employees a voice within the company.
14. 46% of workers feel connected to their managers, job, and company
When an employee feels valued and connected in their job they are more likely to stay with the company. According to research, 46% of employees feel this connection. Additionally, your employees want to feel that their contributions are noticed. You can start by recognizing employees in company newsletters, during team meetings, or with company perks. Additionally, encourage employees to build friendships with co-workers.
Retaining Employees Who Give Notice
When an employee has put in their notice, what can you do to potentially keep them? Studies show that an increase in pay, benefits, and flexibility are likely to be factors to keeping an employee who has decided to leave. Use these employee retention statistics to change the decision of an employee who has decided to quit.
15. 63.3% of departures are for preventable reasons
Of the many reasons your employees decide to seek employment elsewhere, nearly two-thirds of them are preventable. Your employees are looking for opportunities for growth, a manageable work environment, and delivery of promised compensation and benefits.
16. Of the employees voluntarily leaving a company, 52% said their organization could have done something to get them to stay
Not all employees who give notice are a lost cause. Over half will stay if you take proactive steps to keep them. The best way to determine what an employee needs to remain at your company is to have an active conversation with them about why they are leaving and what you, as the company, can do to change that.
17. 91% of employees who are looking for a new job seek employment with a different company
Employees sometimes want to leave their current role because they are stressed, burned out, or the job is no longer satisfying. If there is nowhere else in the company for the employee to go, they likely will seek employment elsewhere. According to this statistic, only 9% of employees looking for a new role will change positions within the same company. Therefore, it is wise to develop career paths and build a strategy for where employees will go when they outgrow their current position.
18. 20% of employees leave a company over career issues
When employees are dissatisfied with their careers, one in five of them will leave your company. Ways to prevent this are to have good management in place, keep in constant contact with your employees regarding their key performance indicators (KPIs), and make their workload manageable.
19. Offering better benefits can result in 19% of your employees staying in their job
Benefits, like healthcare, 401(k), and increased PTO can lead to an employee continuing to stay at their current job. In fact, it is noted that 19% of your employees planning to leave would stay if offered additional benefits.
Why You Should Care About Employee Retention
Employee retention is vital to your company’s bottom line. By retaining your current employees and keeping them satisfied in their roles, you increase your potential for sales and decrease the costs associated with hiring new employees.
The employee retention statistics above show why you should care about employee retention. Reasons include:
- Saves your company money by not having to recruit new employees
- Reduce productivity loss
- Reduces the amount of time and money spent on training employees
- Eliminates the hassle of turnover recruiting
- Connects employees to your company and builds loyalty
- Increases customer satisfaction
- Improves employer branding
Employee retention metrics are a guideline to assist you in determining what can be done to retain your current employees. Make sure your employees are satisfied in their current positions by actively communicating on their progress and productivity. Employee retention is also higher when employees feel valued. You can accomplish this by offering benefits, PTO, learning and development opportunities, and effective management.