8 Strategies To Increase Employee Retention in 2024

Employee retention is essential to long-term business success. Workers are the heart of any company and employee turnover can be costly, disrupt day-to-day business operations, and negatively impact worker morale and an organization’s employer brand.

Key benefits of employee retention include reduced hiring and training costs, increased productivity, stronger company culture and morale, better customer service, and improved business outcomes.

Learn how to reduce turnover and increase employee retention with top strategies and best practices.

Strategies include:

1. Regularly review compensation and benefits offerings
2. Offer access to the latest tools and technology
3. Schedule stay interviews
4. Reward retention and years of service  
5. Build strong relationships with employees
6. Provide clear expectations and feedback
7. Foster a sense of purpose and meaning
8. Support diversity, equity, and inclusion (DEI)

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1: Regularly review compensation and benefits offerings

Competitive pay and benefits are key contributors to employee engagement and retention. According to a survey by Mercer of 4,000 U.S.-based employees, the top reason respondents would consider leaving their current employer is pay and benefits.

Pay is only one piece of a comprehensive benefits package. Benefits may also include paid time off (vacation, sick, public holidays, and family leave), opportunities for remote work and flexible hours, health insurance, life insurance, retirement plans, performance bonuses, profit sharing, wellness stipends, and mental health resources.

In addition to offering competitive compensation and benefits when new workers join an organization, regularly reviewing and updating benefits is important. Depending on the organization, compensation and benefits reviews typically take place annually or biannually, often leading up to the employee review process. Implementing a set cadence can help ensure a smooth process.  

A few steps your organization can take to evaluate and update compensation and benefits offerings include:

• Reviewing your overall budget and identifying opportunities to increase compensation and expand benefits
• Identifying underutilized benefits to determine whether they remain relevant
• Conducting market research to ensure pay is competitive with other businesses in the same industry and recruiting for similar roles
• Evaluating benefits offerings from similar companies to understand how your organization’s options compare
• Researching the latest benefits and perks trends (for example, some benefits that have become more common in recent years include pet insurance, financial wellness resources, and childcare or eldercare reimbursements)
• Taking employee feedback into consideration when updating offerings to encourage retention
• Creating and sharing a formal, written document that outlines the latest benefits

2: Offer access to the latest tools and technology

Motivated workers are eager to embrace the latest tools, technologies, and resources to develop new skills, increase productivity, and drive positive business results. In fact, a survey of 10,000 workers from Ivanti found that 49% of respondents are frustrated by the technology and tools their organization provides and 26% would consider quitting their jobs because they lack suitable technology.

As artificial intelligence (AI) continues to see widespread adoption, workers are particularly eager to have access to AI tools to increase collaboration and productivity. According to research from Microsoft, 89% of respondents with access to automation and AI tools feel more fulfilled because they can spend more time on work that truly matters.

Examples of technology solutions your organization can offer workers include but aren’t limited to, project management software, communication tools, learning and development platforms, file sharing software, and generative AI tools such as ChatGPT. Depending on your industry and business model, you could even have a customized tool developed by independent experts in AI to fill your specific needs.

Some ways to offer and encourage adoption of the latest tools and technology include:

• Asking workers for their input on which technology solutions will help them succeed in their roles
• Completing industry research to identify which tools and resources can help maximize productivity
• Outlining a budget and strategy for technology implementation
• Communicating top benefits of new tools to team members
• Scheduling and recording training sessions to walk through key features
• Implementing policies and procedures to ensure technology is used correctly and securely
• Tracking data to measure adoption and impact of tools and resources

3: Schedule stay interviews

Many companies conduct exit interviews with departing employees to understand why they’re leaving the company and identify areas for improvement with the employee experience. Rather than waiting until a worker is leaving the organization to gain insights about their experience, a more effective option may be to schedule stay interviews.

A stay interview is a structured conversation between a manager or human resources team member and an employee. The goal is to learn what the worker enjoys most about their role and any factors that may cause them to leave the organization. This approach offers many benefits, including understanding what motivates team members and drives employee satisfaction, building trust with workers, and proactively addressing issues to improve employee engagement and retention.

Despite the benefits, according to a 2022 survey from Paychex of 1,000 HR decision makers, only 27% of respondents use stay interviews to help improve retention. If you’re considering conducting stay interviews, implement a standardized process and cadence, such as annually or biannually, and identify steps your team will take to centralize and act on feedback shared by workers.

Some questions to consider asking during stay interviews include:

• What do you enjoy most about your role and your overall employee experience?
• What are some areas for improvement with the employee experience?
• Which challenges or roadblocks have you faced in the past year?
• Do you feel supported in your role? If not, how can your manager or the company offer additional support?
• Do you have access to the tools and resources needed to do your best work?
• Which additional tools and resources would help you succeed?
• Do you have a clear understanding of role expectations and opportunities for advancement?
• What are your long-term career goals at the company?
• Which additional skills are you interested in developing?
• What motivates you and how do you prefer to be recognized?
• What would make you consider leaving the organization?

4: Reward retention and years of service

In today’s workforce, an employee rarely stay with the same company for their entire career. And a contributing factor in worker retention is recognition. According to a survey from Workhuman and Gallup, workers who receive recognition that matches their needs and expectations are 56% less likely to be looking for job opportunities and five times more likely to see growth opportunities at their organization.

While organizations have many strategies to show appreciation to employees, one way to specifically encourage and incentivize retention is by offering rewards for years of service milestones.

By recognizing workers for their tenure at the company, team members will likely be more motivated to stay at the organization long-term. The key to a functional program is to make the reward more than a token, commensurate with the level of their dedication, and a true celebration of the employee’s commitment.

Years of service rewards may include:  

• Paid retention bonuses
• Gift cards
• Gift boxes
• Branded company merchandise
• Charitable donations in the team member’s name
• Handwritten thank you notes
• Team celebration lunches or dinners
• Recognition in company meetings
• Additional paid time off for each year of service
• Sabbaticals or paid vacations for hitting significant milestones (such as five or 10 years with the company)

5: Build strong relationships with employees

Employees who forge connections at work are more likely to be engaged and remain with their current company. In fact, Microsoft research shows that employees who have thriving relationships with their immediate team members report better well-being than those with poor relationships (76% versus 57%) and are less likely to change employers in the year ahead (61% versus 39%).

Workplace relationships include those between managers and their direct reports, as well as relationships between team members and across the organizations.

Here are some tips to build strong relationships with and among employees:

• Schedule regular one-on-one meetings with each team member
• Offer remote work options and flexible schedules to encourage a healthy work-life balance
• Support autonomy and trust employees to complete their work, rather than micromanaging
• Maintain transparency in communications with employees
• Create a safe environment for workers to ask questions and share feedback
• Implement a mentorship program
• Plan team-building activities
• Celebrate individual and team member accomplishments
• Connect workers from different departments through cross-team projects
• Pair each new employee with another team member to have a go-to resource as they get to know the company
• Encourage workers to schedule informal virtual or in-person coffee chats with one another

6: Provide clear expectations and feedback

Setting defined expectations and sharing specific feedback can help workers recognize their strengths and areas for improvement, which can positively impact overall engagement. According to a survey of 1,000 full-time U.S. workers from Workhuman, 93% of respondents have a good understanding of where they stand with their performance. Of those who don’t know where they stand, 60% report feeling constantly stressed at work—which can increase the employee turnover rate.

The following steps can help you identify clear expectations and share actionable feedback with team members:

• Setting SMART goals for each team member to ensure goals are specific, measurable, attainable, relevant, and time-bound
• Defining expectations for communication frequency and channels (for example, direct messages for quick questions and a weekly one-on-one or team meeting for brainstorming and more in-depth conversations)
• Scheduling employee evaluation conversations on a recurring, pre-defined basis—either annually, biannually, or quarterly, depending on what works best for your business
• Leveraging a standardized performance review template to evaluate all workers on the same scale and avoid surprises
• Sharing clear, concise feedback, along with any performance data points and metrics
• Following up on any verbal feedback with a written recap
• Offering ongoing support to ensure team members understand expectations, feedback, and next steps

7: Foster a sense of purpose and meaning

Today’s employees don’t simply work to collect a paycheck, but rather want a sense of purpose and meaning through their roles. Research from McKinsey shows that 70% of employees surveyed said that their sense of purpose is defined by their work and 62% want more purpose from their work.

Finding purpose and meaning through work means understanding how one’s role and contributions positively impact the company and society as a whole. A survey from Paychex of 600 workers found that meaningful work is the second most cited reason why employees continue to stay at their current companies.

Consider the following steps to help ensure workers have a sense of purpose and meaning at your organization:

• Define your organization’s mission and values
• Align individuals’ goals with the company mission and strategic business objectives
• Highlight how worker accomplishments positively impact company goals
• Provide clear career paths and internal growth and development opportunities
• Offer access to professional development and assessment tools for workers to build new skills
• Implement employee recognition programs to reward team members for their contributions and achievements
• Give back to the community through volunteer opportunities, events, charitable fundraisers, or donation matching

8: Support diversity, equity, and inclusion (DEI)

Maintaining a commitment to diversity, equity, and inclusion (DEI), can help organizations create a workplace where every team member feels welcome, valued, and respected. And a company’s approach to DEI can have an impact on worker retention rates. According to a survey from GoodHire of 3,000 workers, 81% of respondents would consider leaving their job due to an employer’s lack of commitment regarding DEI.

Here are some ways to support DEI at your organization:  

• Develop a formal written DEI policy
• Recruit from diverse sourcing channels, such as Diversity.com, Women for Hire, the Hispanic/Latino Professionals Association, Neurodiversity Employment Network, and Military.com
• Standardize the talent acquisition process and automate certain hiring steps to evaluate all candidates on an objective scale  
• Use inclusive language, such as neutral terms versus gendered terms, and avoid local phrases or idioms if your team includes international workers
• Schedule diversity training to help workers understand different backgrounds and perspectives, facilitate positive intergroup communication and collaboration, and minimize bias
• Offer employee resource groups (ERGs) to encourage team members to develop connections around shared interests, communities, or identities—examples include culture or ethnicity-based groups, women, LGBTQIA+, working parents, and veterans and military
• Acknowledge holidays of all cultures and encourage workers to take time off for the holidays that matter most to them
• Measure progress over time by surveying workers about their perspectives on the organization’s DEI efforts or tracking metrics related to retention, engagement, and career growth across demographics

Access skilled independent professionals on Upwork

Taking a proactive approach to employee retention can help increase the likelihood of top talent staying with your organization. As a result, you can reduce costs associated with turnover and maximize business outcomes while creating a harmonious work environment.

If you’re looking for additional support identifying and implementing employee retention strategies, consider engaging an independent human resources consultant on Upwork. Skilled HR consultants are available to share their expertise and ensure you have the right measures in place to increase employee retention.

On Talent Marketplace™, you can also access independent professionals with more than 10,000 skills across a variety of specialties. By engaging independent talent from Upwork, you can quickly fill skills gaps with experienced professionals while reducing operational costs.

Disclosure: Upwork is an OpenAI partner, giving OpenAI customers and other businesses direct access to trusted expert independent professionals experienced in working with OpenAI technologies.

Upwork does not control, operate, or sponsor the other tools or services discussed in this article, which are only provided as potential options. Each reader and company should take the time to adequately analyze and determine the tools or services that would best fit their specific needs and situation.