How to reduce employee turnover

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The term ‘employee turnover’ refers to the number of people who leave an organisation, to be replaced by new staff, over a period of time.

While of course, it’s good to inject new life and get a fresh perspective from new recruits, there’s a balance to be struck.

A high employee turnover should set alarm bells ringing for both employees and employers alike, as it suggests that something about the company, the work environment, or the staff, is making people want to leave. Whilst this is in itself a problem, it also gives rise to a number of other issues.

The problem with high employee turnover

First and most obviously, is cost. The cost of recruiting, on-boarding, and training new staff is significant. You don’t want to be investing this level of resources into someone who stays for three months, only to have to repeat the process for their replacement – the costs will accumulate, and you won’t get close to seeing a return on your investment.

As well as the negative effect on your bottom line, high employee turnover will also impact your team. The best and most effective teams are carefully constructed, with an optimal balance of personalities and skillsets. If you’re constantly adding new people into the mix and losing others, this balance is thrown completely off course, and time is wasted on getting to know people and how they work best, rather than cracking on with the job at hand.

It also won’t help your business to be constantly replacing people, no matter what industry you’re in. Accumulated knowledge and skill are hugely valuable, and key to providing a great, and consistent, service to your clients or customers.

When you lose people, you lose relationships and knowledge that are hugely valuable and take time to build.

It should be clear now that you want to do everything you can to keep hold of good people once you’ve found them, trained them, and integrated them into your business.

But how do you do this?

When thinking about ways to reduce employee turnover, the most logical starting point is to consider: what makes people want to leave a company?

Perceived lack of progression

If someone can’t see a future at your company, it’s inevitable that they will leave, it’s just a matter of when.

When that first opportunity comes knocking, they’ll be off – and honestly, can you blame them?

Nobody likes to stagnate, and how mundane would life be if you knew that nothing was ever going to change? Whilst some level of self-motivation is required of any good employee, you can’t expect people to work hard, push themselves, and seek out challenges only to feel like they’re beating their head against a brick wall when it comes to getting a promotion, a pay rise, a training opportunity, or just a clear trajectory for the future.

You will never be able to manage turnover if your staff see their role – or worse, your company – as a stop gap, a short-term stepping stone on the way to somewhere else. You can be sure that the ‘somewhere else’ will be benefiting from the best of what they have to offer, not you.

You need to stop their eyes from wandering by making your company seem like an attractive long-term prospect. You can do this by ensuring your employees have clear goals and opportunities, and that you are transparent, forthcoming and encouraging about their future prospects. Show them that there is a career path for them to follow, with clear signposts, and they will likely follow it.

If you operate in multiple cities, offer an employee relocation benefit that will give them an opportunity to move to another city or country and develop their skills to boost their career and become a greater asset to the company.

It needs to feel like a place where they’ll be nurtured, valued, and encouraged to grow.

Not feeling valued

If your staff feel like just another cog in the wheel of the corporate machine, there’s a risk they’ll begin to feel jaded, disillusioned, and unmotivated.

If they don’t feel seen and valued for who they are and what they specifically bring to the table, they might wonder if this is really the best place for them and if the grass might be greener elsewhere?

To keep hold of your best people, your company needs to feel like a place where they are seen, appreciated, and encouraged to grow.

There are many ways in which you can communicate to someone that they are valued.

Trust is a big one.

You can show employees that you trust them by not micromanaging, by giving them the freedom to do their job, sharing information, and empowering them to make decisions that drive the company forward.

Make sure you follow up on this with recognition and reward. Remember that not everybody is motivated by the same things. Inevitably some will see their value as reflected in financial terms, and respond well to bonuses, regular pay reviews, and other such incentives. Others feel valued when they are given more responsibility, entrusted with more business-critical tasks and decisions.

Get to know who people are, and what drives them, and ensure they’re getting the type of feedback and recognition they need.


Another contributor to high employee turnover, and a particularly concerning one, is burnout. This is where someone’s work life is so intense and relentless, so draining, that they reach a point where they cannot go on any longer, and quit.

This is more common in fast-paced, competitive ‘dog eat dog’ type industries, and in work cultures where asking for help is seen as a sign of weakness or an inability to do your job.

In this scenario, if you can’t keep up, it can feel like the only option is to walk away.

If you’re regularly losing employees due to burnout, this is a sign that something is seriously not right in the work environment: that you’re using the wrong strategies to motivate people, and that you’re not providing the support that employees need.

No one should ever feel that they can’t ask for help, that they can’t say no, or admit they’re struggling with something. Think about your company culture and the way people are required to work.

It might be that you’re in an industry that is unavoidably fast-paced and stressful – if so, have processes in place to manage this. Encourage people to take time away when they need it, and communicate the importance of identifying a problem early rather than letting it reach crisis point – better a day off to reset and recharge than two weeks off sick, or a lost team member.

Recognise that physical and mental health go hand in hand, ensure your sickness policy reflects this and that your staff know they will be supported in keeping themselves fit for work, physically and mentally.

Employee turnover is an inevitable part of running any business, and is not always a bad thing.

The main thing is that it’s managed, that you’re not losing people as fast as you’re recruiting them, for reasons unknown.

In all of the above scenarios, communication and engagement are key.

Check-in with your employees, encourage people to speak-up, but don’t just wait for them to come to you.

Be proactive, rather than a simple “everything okay?”, ask open-ended questions like, “How are you getting on with X?” and never settle for “fine”.

In an open, transparent and supportive culture, employees will be able to thrive, especially when they are regularly presented with new opportunities, responsibilities, and challenges. A place where people feel good is a place where they’ll want to stay.

Focus on making your workplace that place for them, and you’ll have a happy and thriving team that never wants to leave!



Our co-founder, Phil, loves people, problem-solving and making life easier for small businesses. If you book a Leave Dates demo, he will give you a warm welcome and show you everything that you need to know.