Sunrise, Fla. -- Over the past year, more jobs have opened up in the U.S., prompting employees to search out better opportunities. In May, the U.S. Bureau of Labor Statistics reported that the unemployment rate decreased by 5.6 percent in 2004.
"With more jobs out there, employees are analyzing their current situation and sometimes think they can find a better opportunity elsewhere," said Denise Gians, G.Neil Motivation Product Manager. "Employees who choose to leave impact a company's morale as well as the budget."
Hiring and training costs for a new employee can range from a few thousand dollars for hourly employees to between $75,000 and $100,000 for top executives, according to the American Management Association.
Turnover has a visible negative effect on overall employee morale within companies. Employees may feel unsettled watching a coworker leave and also feel less secure in their own positions.
"Turnover can be hard on other employees in the company, even if they are not directly affected," Gians said. "A good employee should know they are doing a good job in the eyes of their employer."
Keeping Employees Loyal
After recruiting the right employees, businesses must then know how to keep those employees loyal. Satisfied employees will stay with a company longer and produce higher quality products and services.
"Selecting the right employees at the beginning can help any business cut down their turnover rate," said Denise Gians, G.Neil Motivation Product Manager.
Keeping employees faithful to their jobs does not require that companies use monetary rewards. Support and involvement are the most important forms of recognition from management, according to a Nelson Motivation Inc. study. Personal praise and autonomy and authority rank next. Cash and monetary awards ranked at number 10.
"When employees find work interesting and meaningful, along with good management, the prospect of making a little more money at another company usually isn't enough to pull an employee away," Gians said.
According to the American Management Association, 50 percent of the typical employee's job satisfaction is determined by the quality of his or her relationship with the manager.
"Employees who have a positive attitude about their company and feel valued will stick around longer and be more productive in the long run," Gians said.
Managers should offer their employees detailed performance feedback and praise employees' good work and results. Celebrating service milestones with pins or plaques can show employees they are appreciated within the company.