10 Reasons Why Employee Retention Matters!

Benefits of Employee Retention: 10 Reasons Why It Matters

Many companies in Egypt and other parts of the world believe that employees come and go. They believe that if one employee leaves, ‘it’s OK, we’ll just get another one.’

They believe that they’re saving money if the new employee gets paid less than the one who left.

But what they don’t know is that every employee who leaves is a cost incurred by the company. This is even more with employees who have been with the company for over a year. 

These companies aren’t aware of the cost of employee turnover and the value of retaining employees. They have no ideas about the benefits of employee retention and how it can drive their companies forward.

It’s true that employees won’t spend their entire lives in a single company. But…employers who are successful at employee retention, engagement, and empowerment are better-positioned to grow and enjoy better employer branding.

But what is employee retention exactly? What are the benefits of employee retention for companies? And how can businesses retain employees in today’s fast-paced job market?

Keep reading to get answers to these questions.

What is employee retention?

Employee retention involves having employees work for the company for longer periods of time.

However, employees don’t stay with your company because they’re not getting better offers elsewhere. It’s because they feel loyal to your business and want to stay and help you grow.

Companies who succeed at retaining employees usually have a few common characteristics. These include having strong leaders, who empower their teams, alongside employee retention strategies and employee retention programs.

Why employee retention is important ?

Companies with high retention rates understand the benefits of employee retention. They know that by supporting their staff, mentally, physically, and even financially, they can reap more rewards.

When a company has a high employee retention rate, it enjoys more stability, a lower turnover rate, and its employees feel empowered.

This entices newcomers to stay longer at a company because they know that this company cares for its employees.

The higher the employee retention rate the higher the company’s overall morale and productivity.

What are the benefits of employee retention?

1) Higher Morale

One of the top benefits of employee retention is that it increases morale across teams and the whole company. Higher morale affects all aspects of work. It encourages employees to be helpful, interested, and engaged.

2) Better Productivity

The higher the morale and enthusiasm in your company, the more productive your employees and teams will be.

And with more productivity, you’re likely to see more sales and revenues, and better customer experiences.

3) Lower hiring costs

Every time you need to find a new hire, especially after a long-standing one leaves, you incur a cost.

There is a cost in:

• Hiring a recruiter to find candidates to fit your job description. (If you don’t have in-house HR person).
• The time your HR team spends to publish the vacancy across hiring platforms and social media.
• The time your hiring manager spends to interview and test potential candidates.
• The sales that decline or the workload that drops.
• The overtime your current employees have to spend working to cover for the person who left, until the new hire joins and gets acquainted with the job.
• Adding new benefits to your offering or your compensation and benefits scheme.

4) Lower training costs

By investing in your employees and training them, you can retain them for longer. Training also builds loyalty and improves employer branding.

When employees work longer periods of time at your company, you don’t have to start from scratch with employee training.

5) Better in house experience

The longer an employee stays with a company, the better their skills and experience with your products and services.

On the other hand, hiring new employees means less experience and more hiring costs. New comers require on-boarding and training time as well as time to get used to their new team and manager.

6) Stable Environment

Employees want stability. Especially as they age, gain more experience, and start families.

Every candidate wants to join a company where they can work for a long time without having to go through the hassle of job search.

A company that retains its employees, engages them, and supports their growth through workshops, training, and benefits, is one that creates a stable work environment.

7) Better customer experiences

When employees care about your company and are loyal to you, they’re happier and more motivated. This allows them to offer better experiences for your customers.

The better experiences your customers get with your company, the more likely they are to stay with your company.

8) Better brand reputation

Many employers aren’t aware that they can get better branding by retaining and engaging their employees.

Employer branding is the reputation of your brand and company as a whole. It’s what makes potential customers buy from you and entices employees to join your company.

Companies suffering from a bad reputation struggle to hire new candidates because no one wants to join. 

9) Higher employee engagement

Employee engagement and empowerment go hand-in-hand with employee retention. It’s a concept of building an emotional connection between a company and its employees.

Engagement makes employees enthusiastic, loyal, and more willing to contribute to a company’s growth and success.

10) Having brand advocates

When employees feel valued by their employer, when they feel like a team, when their morale is higher, they become brand advocates.

They become excited about your brand and ready to share your achievements and news with others.

For Tips about how to How to retain employees in your company, check our following blog article