Contemporary HR issues Blog #4 - What are the most important HR issues facing your organization today?

Factor affecting employee retention

Employee retention is a process used to keep the loyalty of existing employees & methods used to avoid them to work for another company. (Ivanovic, 2007)

It is necessary to focus on factors that affect employee retention for the growth & success of the company. (Agrela et al., 2008)

Although offering good salaries are important for employee retention, modern researchers have found that retention strategies should go beyond typical salary & benefit package. Different authors have highlighted different factors which affect employee retention.

Career development – Career development contains assessing, exploring, setting goals & acting. (Ginzberg et al., 2005) Career development opportunities will have direct impact on employee decision on retention & resignation. (Francis, 2014)

Learning & working climate – Learning & development is a very important fact to retain highly talented employees. (Hytter, 2007) The concept of “Learning & working climate” refers to work environment where employees do both learn & work. Researchers have found that learning & working climate concept has a positive effect on employee retention. (Abrams et al., 2008)

Job flexibility – Job flexibility includes ability to choose individual work times, work load, responsibilities & location. Employees those who has job flexibility will have higher level of commitment, concentration, satisfaction, productivity, loyalty & mental capacity. (Prenda & Stahl, 2001)

Training – Training can be described as one of the key retention strategies & providing training programs may increase employee retention up to 70% (Eisen, 2005)

Superior – Subordinate Relationship – Employee development can’t be done without having a supportive culture. Hence the Management of the organization should be very supportive to subordinates & also they should act positively as role models. (Zenger, Ulrich,

Smallwood, 2000)

Compensation – It is important to make employees to feel that their pay rise significantly. Many companies raise base pay based on performance but some companies adopt team environment, but still they reward people for their individual achievements as well. (Feldman, 2000)

Other than above mentioned factors there are several other factors which affect employee retention positively & negatively; such as HRM practices, Performance appraisal system (Francis, 2014)

References 

Abrams, J., Castermans, S., Cools, H., Michielsen, M., Moeyaert, B., Van Meeuwen, N. and VanNooten, L. (2008), “Learning and talent management: factors which influence the retention of (talented) employees”, unpublished research report, Faculty of Psychology and Educational Sciences, University of Leuven, Leuven.

Agrela, R., Carr, R., Veyra, v., Dunn, c., Ellis, D., Gandolfi, A., Gresham, B., King, L. , Sims, A., & Troutman. (2008). Retention issues and solutions: Tools to ensure University of California becomes an employer of choice, CUCSA Staff Retention Committee.

Eisen, P., Jasinowski, J., Kleineli, R. (2005). 2005 Skills gap report - A survey of the American manufacturing workforce. Available at http://www.themanufacturinginstitute.org/~/media/738F5D310119448DBB03DF30045084EF/2005_Skills_Gap_Report.pdf (Accessed: 17^th May 2018 at 10.30PM).

Feldman, D. (2000). The Dilbert syndrome: How employee cynicism about ineffective management is changing the nature of careers in organizations. American Behavioral Scientist.

Francis, A.U. 2014 “Human Resource Management Practices and Employee retention”, International Journal of Scientific & Engineering Research, Volume 5, Issue 2.

Ginzberg. (44442005) Occupational Choice: An    Approach to a General Theory.    Columbia University  Press: New York.

Hytter, A. (2007), “Retention strategies in France and Sweden”, The Irish Journal of Management, Vol. 28 No. 1, pp. 594-79

Ivanovic, A. 2006. Dictionary of Human Resources and Personnel Management. Huntingdon, Great Britain: A & C Black.

Prenda, K. & Stahl, S. (2001). Peak job performance at any age: The truth about older workers [Electronic version]. Business and Health. 5 (30).

Zenger, J., Ulrich, D., & Smallwood, N. (2000, March). The new leadership development: It’s about results for your company. Training & Development, 54 (3), 22-27.