Reduce Turnover and Improve Employee Retention

22 February 2021

One of the most important indicators of organizational health is employee turnover. Despite the high unemployment rates we’ve seen during the COVID-19 pandemic, almost 30% of hiring managers say that employee turnover is a major concern.  Employee turnover is an extremely costly problem and organizations spend thousands of dollars on retention activities trying to mitigate it.

Direct and Indirect Costs

To understand the total cost of employee turnover, it’s important to look at both the direct and indirect costs:

  • Direct costs include hiring costs (advertising and recruitment fees), interview expenses (time and travel), and training and onboarding costs. If you consider that recruitment fees alone can be 30% of the new hire’s base salary, it’s easy to understand just how costly it is to replace an employee.
  • Indirect costs consist primarily of lost time and productivity. If you have replaced a sales representative that was consistently bringing in $5,000 per week, it’s very likely that the new hire is going to spend a number of weeks bringing in zero revenue, followed by additional weeks of ramp-up to bring them up to the same productivity level. In addition, the productivity of your top performers suffers due to the time they spend training the new hire. Persistent turnover can also be very culturally disruptive and employees who have lost managers or team members often have reduced productivity and morale.

Effective Retention Practices

It’s clear that employee turnover is extremely costly and has both negative financial and cultural effects on an organization. Let’s examine some areas where retention practices are effective in helping organizations reduce turnover:

  • Recruitment practices can strongly influence turnover and there is research to show that unrealistic job previews can lead to poor retention. It’s easy to get caught up in selling the role to a candidate, but this can be a problem when their expectations aren’t met. One study shows that nearly 50% of employees have left their job because of a mismatch between their expectations (based on the recruitment process) and reality. A realistic job preview goes beyond the tasks and day-to-day responsibilities and includes expectations regarding team collaboration, performance goals and feedback, and the growth potential for the role.
  • Socialization practices delivered through onboarding are important for helping new employees understand the company culture and norms. Employees who develop connections with coworkers and become embedded in the company culture are more likely to stay long term.
  • Training and development are important for keeping employees long term Employees who are given the opportunity to upgrade their skills are more likely to stay with a company, whether it be on-the-job training with a supervisor or formalized education outside the workplace.
  • Active supervision is also an important driver of retention. Employees need supervisors to effectively communicate expectations and provide frequent feedback on their performance. The saying that ‘people leave managers, not companies’ is often true.


It’s important to not only implement good retention practices but to also measure their effectiveness using an ATS or HRIS.  Tracking employee turnover monthly and annually, and across different jobs and departments, can help you proactively respond to turnover issues and retain great employees. At Sincron HR our users utilize the recruitment and retention metrics embedded in the platform as well as the electronic onboarding module to address pain points associated with poor socialization, supervisor feedback, and relevant training and development programs.

  • The platform allows organizations to integrate their strategic planning objectives and KPIs into performance management
  • Sincron HR configures the platform to ensure organizations meet or exceed industry/accreditation standards
  • The new HR Essentials platform is now available for just $2/month per employee
  • Training and tech support (call, text, video library, etc.) is included

To learn more Contact Us Today!