Avoid These Mistakes To Improve Employee Retention

Words: Matt Dibara

Words: Matt DiBara, The Contractor Consultants 

Employee retention is a major issue, especially among companies interested in industrial and manual services workers. Businesses are struggling to keep employees, and turnover rates stand at above 50 percent, which means half of your employees will quit in the next few months.

The problem seems to be more persistent in some industries, including the construction industry, where the retention rate is less than 40 percent 1. So, what’s causing employees to quit, and what can companies do to increase employee retention rate? Let’s find out:

#1 Not Making Employees Feeling Appreciated

Photo Credit: jarmoluk

Employees that do not feel recognized are quick to move to a job that values them. They look for validation and are more likely to be loyal when their efforts are recognized and rewarded. According to reports, employees who feel acknowledged are 5x more likely to work for the same company.

Workers are willing to work hard to prove their worth, especially when they're in a new position. However, if they're met with negative criticism or no acknowledgment, they'll get unmotivated and unhappy. Hence, it doesn't come as a surprise that about 79 percent of people who quit a position cite 'little to no appreciation' as their reason.

A great way to solve this problem is to introduce a reliable appreciation or acknowledgment system. Back in the day, a pat on the back was enough but employees today need more. They need instant gratification, and a great way to offer it is to offer something of monetary value.

Employees need to know you know they've done something good in 'real time'. 

  • Won a big contract? Offer rewards right away.
  • Got your client to resign? Appreciate the team.

We love the poker chip example that we introduced a few years ago. Every time an employee does something exceptional, offer poker chips in return. At the end of the week or month, employees with poker chips get a chance to win gifts such as dinner vouchers, a day off, etc.

#2 Failing to Manage Expectations from the Beginning

Photo Credit: Shopify Partners

A lack of clarity is a major reason why employees quit. Don't leave your workers wondering what their role is or what they're expected to do on a daily basis. 

A good way to set expectations is to improve the onboarding process. Unfortunately, about 76 percent of businesses 2 agree that their onboarding processes are underutilized, and over 24 percent have no onboarding strategy.

Disorganization leaves a very bad impression on workers. They don’t feel welcomed and end up being unproductive. Plus, they don’t look at it as a good sign. Companies with poor onboarding processes are considered unprofessional, and most workers are not willing to work with unprofessional firms. 

Create a smart onboarding strategy and ask questions to avoid confusion. This is the best way to course-correct and ensure workers are fully aware of what they’re expected to do.

#3 Neglecting the Importance of Feedback

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Employees that aren’t comfortable giving upward feedback are 16 percent less likely to remain loyal. The key lies in open communication and making sure there’s clarity. Also, it has to be a two-way thing. 

Here’s what companies need to do:

  • Offer feedback, including positive and negative feedback, but keep the tone professional. The purpose should be to help employees learn from their mistakes and allow them to understand what they can do differently.
  • Ask for feedback through a variety of tools, such as anonymous feedback forms, employee audits, exit interviews, etc.

Also, make feedback count. About 30 percent of employees believe that their managers do not value their feedback, and only 60 percent have a clear feedback tool.

#4 Having Poor Work Culture

Photo Credit: Mrleyli

Organizational culture is a broad term that involves too many things. In simple words, it's what your company stands for.

The definition has evolved over the years, and it is no more about having a solid motto or a friendly work environment. It's also about flexibility and trying something new. Big names like Google and Microsoft are known for their good work culture. They value their workers and offer great benefits such as the ability to work from home and off days to celebrate special occasions.

More and more employees want similar treatment now. So, work on creating a work culture that's inclusive, welcoming, and fun. You can introduce elements such as 'Bring Your Family to Work' day and a game room for workers to have fun.

#5 Missing Growth Plan

Photo Credit: Ben_Kerckx

A 2018 report 3 revealed that 93 percent of workers would stay longer if the company invested in their careers. Though old, this stat still holds true and is very frequently mentioned. Businesses do not wish to see their star player leave, and a great way to do this is to offer workers a chance to grow. 

About 70 percent of employees say they’ll quit their current job if they find a position that offers better opportunities. Moreover, some may be willing to accept a pay cut today if it means better pay tomorrow. 

Investing in your team is a great way to show that you care and want to see them improve. This can be done by holding training seminars, encouraging continued education, and more. Also, show employees the benefits of improving or training. For example, a chance to move to a better position.

There is no secret formula; as a business, you have to understand what employees really want in order to retain them. Still, some will continue to move out. Some movement is necessary and healthy. You can’t have a 100 percent retention rate because you will need new employees to bring fresh and different ideas.

Your aim should be to keep the turnover rate as low as possible and change your strategies with time. 


  1. https://www.award.co/blog/employee-turnover-rates 
  2. https://www.hrdive.com/news/76-of-hr-leaders-say-their-onboarding-processes-go-underutilized/514891/v 
  3. https://learning.linkedin.com/resources/workplace-learning-report-2018 

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