What is employee retention?

Retention is an organisation's ability to keep its people. It is usually expressed as a percentage. If you have a retention rate of 80%, it means the organisation kept 80% of its employees that year and lost 20%.

Why does retention matter?

When someone leaves your organisation, it can cost a great deal of money. High turnover can also lead to lower productivity and to goals not being met. The retention rate shows you how many people are leaving your organisation, and whether there is room for improvement.

How do you improve your retention rate?

If the retention rate is very low, meaning a lot of people are leaving, it is important to improve it quickly. Improving retention does not have to be difficult or expensive. First, it is important to offer people a development perspective. What steps can they take in their current role, and how do they get there? If people cannot grow and develop, they will soon start looking for another job. Does that happen often? Then your retention rate will fall. A development perspective does not always have to mean a vertical step. Someone can also develop sideways, becoming an expert in a particular area, for example. Second, it is important to have the right person in the right place, so they can come into their own and are less likely to leave. Finally, it is important to give people regular feedback. Take an interest in your people, and make sure you recognise them when they do something well.