0 Comments | Mar 30, 2010

Retention? In a Recession? REALLY?

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It may seem strange to think about retention during a period of double-digit unemployment. If you chose to ignore retention, you wouldn’t be alone – 43% of business owners guess at their employee turnover costs, and 13% don’t consider employee turnover expenses at all. The Institute for Corporate Productivity reports that while only 20% of businesses have a retention strategy in place, 46% of businesses claim concern about retention to a “high” or “very high” extent.

While few businesses pay as careful attention to retention as they should, employee turnover turns out to be among the highest employment costs most businesses bear. We’ve done quite a bit of research to support our recent white paper, and discovered that the average 100-person professional firm can save over $850K per year by reducing employee turnover just 20%.

The counterintuitive upshot is that recessions don’t make your key talent less valuable; instead, the economic downturn means your business relies more heavily on your most important staff members. And if they’re high quality leaders in your field, beware: truly talented employees are worth more during a recession. It’s important that you’re positioned properly to keep your talent on your team.

So how do you attract and keep high-caliber staff? A recent survey reveals that your benefits package is of equal importance as your base compensation plan to employee retention. 20% of employees say benefits are the most important retention consideration, and 20% report salary as the most important factor. Other key factors include workplace environment and job stress.

Happily, employees perceive our Vacation Wellness™ program as a high-value benefit, and enjoy the reduced stress and lower healthcare expenses the program offers. It might be a business solution worth considering.