Why Your Tech Business Should Care More About Employee Retention Rate

The tech industry is highly competitive. As soon as you have a nice mix of talent and customers, a competitor springs up and steals your best employees and sometimes your clients, as well. However, if you strive to keep your workers happy and make them feel part of something bigger, they are much less likely to leave you for the new shiny business around the corner.

A mere 12% of employees leave a position because of money, even though the majority of employers (89%) think that is the reason most do. If good workers aren’t leaving because of higher pay, then what is driving them to new positions? Losing people costs companies money. There are many schools of thought on the cost of low employee retention, but at a minimum, you must spend money and time recruiting and training someone new.

If you want to keep the talent you find and train, there are some things you can do to encourage better employee engagement. Focus on these, and your personnel are more likely to remain loyal and stick around, even if a better offer comes along.

1. Train Them Up

Invest time and effort into your employees. Keep them engaged by training them to complete new tasks and giving them opportunities for growth. Pay for outside classes, offer in-house workshops, reimburse them for a related business conference. In a recent survey of employees, about 94% said they’d stay longer at a company if there were more development opportunities.

The more your employees know, the more it benefits your business. While it is true that a small percentage of people will leave no matter what you do, having a well-trained workforce ensures you’re at the top of your game. It shows your workers you believe in them and that they’ll stay with you for the long term.

2. Help with Hardship

There are times when people run into hardships. Perhaps one employee hurts themselves moving furniture to a new office and has to be off work for a few weeks. How you step up and help with hardship and the plans you have in place to compensate employees can improve your overall employee retention rates. Think through the most common work-related illnesses and injuries your employees might suffer and put a plan in place for how you’ll handle these events as they occur.

Have a big heart for your work family. If a young father finds out he has cancer, how can the company step up and make things easier for him as he goes through treatments? Perhaps other workers could be allowed to donate one day of their sick time if they want to, for example, and the company could match those days, giving the worker the time needed to get better.

3. Seek an Attractive Location

Think about your industry and the different locations where your headquarters might be located. For example, there are top cities for web designers or programmers where the pay is higher and opportunities expansive. You have two options. You can locate your office smack in the middle of the hub of activity and compete for all the best employees with other firms like yours. Conversely, you can open in a smaller town or suburb near the center and attract top employees who want a slower pace or desire to live closer to family.

Think about how much you’ll have to pay in salary and cost of living for the area. How can you attract excellent prospects without going broke?

4. Praise Effort

Take the time to praise your employees not only for success, but also for effort. Did everyone on the team pitch in to help with a big project so you could meet a deadline? Perhaps you missed the deadline by 24 hours, but you saw the extra attention your team gave. You could still host a free pizza party in the break room as a thank you for their hard work that week. Think about ways you can praise them for trying harder and striving to improve rather than only focusing on outcomes that individual employees may be unable to control.

5. Create a Positive Company Culture

About 11% of employees say they leave a company due to manager behavior, and another 5.2% go due to the work environment. These are things you have complete control over. Train your managers to give constructive criticism rather than negative feedback. Encourage helping one another and reward employees who are good team players. Host in-house workshops and go on team-building retreats. Treat your workforce like an extended family. Many may spend more time with their co-workers than their own family members, so you want a functioning rather than a dysfunctional unit.

6. Offer Perks

Even though the salary is a small part of why people leave their jobs, a significant number do so to make more money. If you can’t compete with larger businesses on wages, think about other perks your small tech company can offer that the big guys don’t. Perhaps you could provide more paid time off, days to volunteer at a local charity, flexible work time, telecommuting options or other perks such as casual dress codes. Think about how you can differentiate yourself from others and what you offer that’s unique.

7. Communicate Better

Not every employee will come to you and explain their concerns or ask if you can match another offer. You must encourage open communication without fear of retribution. Treat your employees the way you’d want to be treated if you had a problem or opportunity at another company. Schedule regular one-on-one meetings to find out what you can do better as a manager and how you can best meet the needs of your staff. If you encourage open communication, it will be much harder for a competitor to steal your top tech talent. They are much more likely to come to you and explain the offer they’ve received and see if you can match it.

8. Avoid Boredom

One reason employees leave for a new opportunity is boredom. It’s easy to fall into a rut when you do the same job day after day. Provide exciting new opportunities for your workers. Promote from within. Encourage them to take on challenging tasks without fear of repercussions if they fail. Have more experienced people mentor the newer ones. Plan events that break up the monotony and outings that are just for fun and totally optional.

Retain Talent

The more talent you can retain and build up, the better your tech company will be. It costs time, money and lost effort to train an employee only to have them leave at the first opportunity. Instead, invest in people, and you’ll find that your workforce is one of the strongest in your industry.