Employee turnover is an integral part of running a business. Retirement, promotions, and team expansion are all part of the employee lifecycle. However, excessively high employee turnover rates indicate underlying organizational problems resulting in numerous issues: 

• Loss of valuable institutional knowledge
• Reputation damage
• Disruption in operations and a decrease in product quality
• Low team morale 
• Productivity loss

It's more than just a bad reputation that comes with a high turnover; the financial strain can be significant. According to the Society for Human Resource Management (SHRM), the average cost-per-hire is about $4,000. When turnover is high, companies are forced to spend more on recruiting and training new employees, which can get expensive quickly! The cost of replacing an employee can be as high as 20% of the employee's annual salary for positions earning $30,000 to $50,000 annually, which can be a major hit, especially for startups and smaller companies. 

To avoid high turnover, leadership must understand why employees seek other opportunities and how to create a workplace where employees don’t feel they have to work but want to work. By addressing these issues, employers cannot only retain their top talent but also foster a more positive and productive work environment.  

What are the leading causes of high turnover, and how can they be addressed?

Employers must be mindful of how their actions affect their employees. If an employee's behavior changes, leadership should ensure they’re not the root cause. Understanding why employees leave can help address issues before losing top talent.

1. Micromanagement

Most professionals have experienced micromanagement at least once in their careers and know how stressful it can be to have someone breathing down your neck. Excessive supervision negatively affects employee morale, job satisfaction, and turnover rates. 

Common issues associated with micromanagement: 

• Decreased job satisfaction. Micromanaged employees often feel undermined, and their skills and expertise are not recognized or utilized.
• Stifled creativity. Employees may hesitate to take risks or propose new ideas for fear of being criticized or corrected.
• Increased burnout. Constant oversight and scrutiny can lead to increased stress and burnout among employees. 
  

How to address the Issue:

• Promote autonomy. Managers should provide autonomy, allowing employees to make decisions and manage tasks. 
• Encourage communication. Create an open and transparent communication culture where employees feel comfortable expressing their ideas, concerns, and feedback.
• Accept feedback and be adaptable. Regularly seek employee feedback about their experiences and use it to adapt and refine management practices to better support employee growth and well-being.
  

Companies can create a better work environment by reducing micromanagement and promoting trust, autonomy, and communication. 

2. Lack of company culture 

A company's culture (or lack thereof!) affects turnover rates, as without it, employees won’t feel connected, supported, and valued. Typical problems that arise from a lack of company culture: 

• Decreased satisfaction. Without a strong company culture, employees may experience decreased job satisfaction, leading to difficulty finding meaning and purpose in their roles.
• Stifled creativity. A weak company culture can discourage creativity and innovation, as employees may feel stifled or hesitant to take risks.
• Increased burnout. Employees may experience higher stress levels without a supportive culture, affecting their overall well-being and job satisfaction.

How to address the issue: 

• Define and core values. Clearly define and regularly communicate the company's core values and mission to employees. 
• Promote transparency. Foster an environment of openness where employees feel comfortable sharing ideas, concerns, and feedback. 
• Encourage engagement. Involve employees in decision-making processes and encourage their participation in company initiatives and events to help build a more creative office culture. 

By improving company culture, employees will feel more connected to their work and, in turn, feel optimistic about growing with the company. 

3. Lack of leadership 

Non-hierarchical workplaces are often promoted to attract employees looking for more freedom and creativity. However, without clear expectations and guidance, workers usually lack the support and resources to do their best work. 

Problems that can arise from lack of leadership:

• Lack of direction. Clear leadership may help employees understand their roles, responsibilities, and expectations, leading to clarity and certainty.
• Decreased engagement. Poor leadership can lead to decreased employee engagement as employees may feel disengaged from their work and the organization's mission.
• Stifled growth. Without guidance and mentorship from leadership, employees may feel there are limited opportunities for growth and development within the organization.

How to address the issue: 

• Promote autonomy. Managers should give employees the autonomy to make decisions and manage their tasks, trusting their skills and expertise.
• Encourage communication. Create an open and transparent culture where employees feel comfortable expressing their ideas, concerns, and feedback.
• Provide development opportunities. Invest in training programs to equip managers with the skills to effectively lead and empower their teams.

Effective leadership is critical to creating a positive work environment and can significantly improve retention rates and overall organizational success.

4. Restrictive scheduling

As more companies switch to fully remote work and allow for flexible, asynchronous schedules, rigid work hours are becoming less acceptable in today's workplace. Companies that don't require in-office work but still force employees to adhere to strict 9-5 schedules tend to have higher turnover rates, leading to burnout, stress, and dissatisfaction, prompting employees to seek better work-life balance opportunities elsewhere. 

Common Issues associated with restrictive schedules:

• Decreased work-life balance. When they're always on the clock, employees may need help balancing their work responsibilities with personal and family commitments. 
• Burnout. Long working hours and inflexible schedules can increase employee burnout.
• Decreased productivity. Overworking employees can decrease productivity and employee engagement, as tired and stressed employees are less efficient and effective.

How to address the issue: 

• Flexible arrangements. Implement flexible work arrangements, such as remote work options, flexible hours, or compressed workweeks, to accommodate employees' needs and preferences.
• Promote work-life balance. Encourage employees to prioritize their well-being and personal lives by promoting a healthy work-life balance within the organization.
• Monitor overtime. Manage overtime hours to ensure that employees are not regularly required to work excessive hours, which can lead to burnout and dissatisfaction.

Flexible work hours can improve the work environment, reduce turnover rates, increase employee satisfaction, and attract top talent. Trusting employees to manage their work hours and workload can lead to better work-life balance, well-being, retention, and organizational success.

5. Always having to be “on”

Constant connectivity through workplace communication tools like Slack and Zoom has become the new norm in many organizations. While these tools can enhance collaboration and communication, the expectation of always being on and available can increase employee stress and dissatisfaction, as nobody likes to be pinged early on a Sunday morning while enjoying their coffee. There are, of course, exceptions to this when employees need to be on call, but without communication, always being connected often leads to these common issues: 

• Disrupted work-life balance. The constant need for workplace communication tools to be available can make it difficult for employees to separate work from their personal lives.
• Increased stress. Being connected and available can increase stress and burnout among employees, who may feel pressured to respond to messages and requests outside regular working hours.
• Decreased productivity. Constant interruptions from workplace communication tools can disrupt focus, reducing productivity and performance.

How to address the issue:

• Establish communication norms. Set clear guidelines for when employees are expected to be available and responsive on workplace communication tools and encourage them to disconnect during non-working hours.
• Promote balance. Encourage employees to prioritize their well-being and personal time by respecting their boundaries and not sending non-urgent messages outside regular working hours.
• Lead by example. Leaders and managers should set a positive example by respecting employees' time and not sending non-urgent messages outside regular working hours.

When employees feel they can never truly disconnect from work, this can breed resentment and profoundly affect their overall well-being. It is one of the most common causes of higher turnover rates.

6. No room for growth

Humans thrive on learning new things, and that desire is no different in the workplace. Employees who need more room for growth will likely become disengaged and seek better opportunities elsewhere. Here are some of the challenges that arise when there's a lack of growth in the workplace: 

• Decreased engagement. Without opportunities for growth and development, employees may feel unchallenged in their roles, leading to decreased engagement and motivation.
• Low morale. A lack of growth opportunities can lead to low morale, as employees may feel undervalued and unrecognized for their organizational contributions.
• Complacency. Employees may become complacent and less innovative without opportunities to learn and grow, leading to stagnation in their roles.

How to address the issue: 

• Implement career development programs. Establish clear career paths and progression opportunities within the organization, allowing employees to see a future and potential advancement.
• Provide mentorship. Pair employees with mentors or coaches who can provide guidance, support, and feedback to help them grow and develop.
• Encourage upward mobility. Promote internal job postings and encourage employees to explore opportunities within the organization to advance their careers.

Addressing the need for more room for growth requires organizations to prioritize professional development, career planning, and opportunities for advancement. 

7. Weak communication 

Effective communication is key to success in any organization. If communication is strong, it can lead to understanding, clarity, and a lack of trust among employees. Poor communication can take different forms and impact employee satisfaction and retention. When employees are not informed and involved in organizational decisions due to weak communication, it can cause various problems:

• Increased misunderstandings. Weak communication can lead to confusion about roles, responsibilities, and expectations, causing confusion among employees.
• Lack of trust. When communication isn’t clear, micromanagement may increase, as there is a lack of trust in leadership.
• Low morale. A lack of clear and open communication can lead to low morale, as employees may feel disconnected from their colleagues and the broader organization.

How to address the issue:

• Promote open communication. Foster a transparent communication culture where employees feel comfortable sharing ideas and feedback.
• Keep employees in the loop. Inform employees about organizational changes, updates, and, of course, achievements!
• Train managers in communication skills. Provide training and development opportunities for managers to enhance communication skills and promote effective team management.

Addressing weak communication requires organizations to prioritize transparency, clarity, and open dialogue.

8. Poor task delegation 

Have you ever had a day or week (or more) when you haven’t had anything to do at work? It may sound relaxing, but not understanding what needs to be done can quickly become stressful. When task delegation is lacking, employees may feel overwhelmed, undervalued, or unsure about their responsibilities, leading to dissatisfaction and frustration, as well as other things: 

• Employee overwhelm. Inefficient task delegation can lead to employees feeling overwhelmed with a heavy workload or needing clarification about their priorities.
• Lack of skill utilization. When tasks are not delegated effectively, skills and strengths may not be fully utilized, leading to stagnation.
• Micromanagement. Lack of task delegation can result in micromanagement as managers may need to closely monitor and control every aspect of employees' work due to a lack of trust or clarity.

How to address the issue:

• Understand employee strengths. Take the time to understand each employee's strengths, skills, and interests to delegate tasks effectively and align them with their abilities.
• Provide clear instructions. When delegating tasks, communicate expectations, deadlines, and priorities to avoid confusion and ensure alignment with organizational goals.
• Empower employees. Empower employees to take ownership of their tasks and make decisions, giving them the autonomy and trust to succeed.

Without proper task delegation from team managers or higher leadership, employee turnover will likely increase, as most workers want to feel like they are meaningfully contributing to their work. 

9. Limited benefits package

A competitive benefits package is critical in attracting and retaining top talent in today's competitive job market. When a company offers a poor benefits package, potential talent may look elsewhere, as the standard, especially concerning PTO and wellness benefits, has been raised over the years. As employees seek better opportunities that offer more comprehensive and appealing benefits, other problems can occur as well: 

• Decreased satisfaction. A poor benefits package can decrease job satisfaction as employees may feel that the organization must adequately prioritize their needs and well-being.
• Attraction challenges. Without competitive benefits, it can be challenging for companies to attract and retain top talent, leading to higher turnover rates.
• Financial stress. Employees may experience financial stress due to inadequate healthcare coverage, retirement savings options, or other essential benefits, which can affect their overall well-being and job performance.

How to address the issue:

• Review and enhance benefits. Evaluate the current benefits package and consider enhancing or adding new benefits such as healthcare options, retirement plans, paid time off, and professional development opportunities.
• Keep an eye on competitors. Research and benchmark the benefits package against competitors to ensure it remains competitive and attractive to current and prospective employees.
• Offer flexible benefits. Consider offering flexible benefits or customizable options, allowing employees to choose benefits that suit their needs and lifestyles.

With more companies going remote, employees may have more options than usual, which makes a competitive benefits package essential for attracting and retaining top talent. 

10. Lack of team cohesion

Team cohesion is vital for effective teamwork, as shared goals and support increase employee bonding and the ability to work together. Without a collaborative work environment, employees may start looking elsewhere where they can feel more connected to their coworkers, resulting in a host of issues that can affect the workplace: 

• Feelings of isolation. Employees may feel isolated or disconnected from their colleagues, leading to decreased job satisfaction and a sense of belonging.
• Poor communication. A lack of team cohesion can result in poor communication, misunderstandings, and conflicts among team members.
• Decreased collaboration. Cooperation and teamwork may suffer, affecting productivity and performance.

How to address the issue: 

• Team-building activities. Organize activities and retreats to help employees get to know one another, build trust, and foster stronger relationships.
• Promote collaboration. Provide opportunities for team members to collaborate on projects, share knowledge, and support one another.
• Address conflicts. Address conflicts or issues within the team promptly and effectively to prevent them from escalating and affecting team cohesion.

Addressing a lack of team cohesion requires organizations to prioritize team culture, communication, and collaboration. More cohesion in the workplace will make for happier and more productive employees. 

Keep employees engaged and happy with a team-building retreat

By implementing strong communication channels and nurturing a strong company culture, companies can lay the groundwork for building a workplace where employees are happy to stay in the long run and attract top talent. 

One of the best ways to address many (if not all) of the potential issues discussed in this article is to plan an off-site team-building retreat for the whole company. Getting away from the office to get to know one another and take a break from the daily routine is an effective way to boost employee satisfaction and demonstrate appreciation for their hard work. 

As experts in team-building and retreats, Surf Office can help organize all the details, from accommodation and activities to team-building activities that will address specific goals, even if that goal is sitting back and relaxing on the beach with the whole team.