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Home > Blog > small-business > 5 Key Drivers of Employee Retention

5 Key Drivers of Employee Retention

01 Nov 20195 Mins Read

In a 2019 Global Talent Competitiveness Index (GTCI) published by business school Insead, Singapore ranked as one of the top countries in talent competitiveness. In the global rankings, the city-state came second to Switzerland, and ahead of the United States. However, while it maintained its leading position in Asia Pacific (APAC) in talent competitiveness for six years in a row, Singapore companies still perform weakly in terms of retaining talent, ranking 26th overall. Furthermore, according to the Qualtrics Employee Experience Survey published in 2018, 20% of employees in Singapore are an attrition risk, especially employees under 25.

Some direct consequences of poor employee retention are increased costs and lower productivity and team morale. When somebody in the company leaves within only a few months of being hired, the time and money spent during the hiring and onboarding process are lost. Having to start the hiring process all over again thus results in increased expenses. Restarting the training process also lowers efficiency. Additionally, office morale is affected as other employees might have to temporarily take up additional tasks. Gradually, they might lose confidence in management and also end up leaving.

Therefore, while it is certainly important for firms to attract and secure talent, learning how to retain these talents is also a key aspect in maintaining a company’s productivity and competitive edge. On this note, how can HR practitioners thus contribute to the employee experience and retain top talent?

What makes employees happy?

Based on the Qualtrics survey, only 49% of employees are satisfied in their current role, which is below the global average of 62%. So, before we delve into how to retain employees, it is important to first understand what they value and look out for in their careers.

Singapore workers told Qualtrics that confidence in senior management and a manager who helps resolve work-related issues are some of the key drivers of job satisfaction. Salary is not a significant driver of satisfaction, ranking 9th in a list of other factors. Employees value workplace engagement, such as leaders interacting with the workforce on a personal level, more than monetary rewards.

In another survey done by global recruitment specialist Robert Half, 25% of workers claimed that they would leave their current workplace for better work-life balance, followed by 24% who would leave for better financial rewards and 23% citing career development. Matthiew Imbert-Bouchard, Managing Director of Robert Half Singapore states that while salary remains significant in securing top professionals, more jobseekers are looking for work-life balance and non-financial incentives rather than just a high salary.

Key Drivers of Employee Retention

Based on employee sentiments stated above, we have listed down a few ways your company can keep some of your best talents.

1. Workplace flexibility

With work-life balance becoming a prime concern for many employees, companies should try to offer flexible working arrangements (FWA). The Ministry of Manpower (MOM) reported that workers are more likely to stay with companies that offer such flexibility. FWAs enable employees who were previously held back by other commitments to work more efficiently. Some options include flexible working hours (flexi-time), compressed work week, and telecommuting (flexi-place). Imbert-Bouchard stresses that if your firm is not in a position to award pay increases or above-average salary packages, workplace flexibility is one key method to retain top performers.

2. Employee benefits

In 2018, a study by the Society for Human Resources Management (SHRM) found that 92% of employees consider benefits to be important to their overall job satisfaction. Results also found that 29% of workers would leave their current organization for a better benefits package, and that 32% of workers stay because of good employee benefits.

Also referred to as fringe benefits or perks, employee benefits are offered in addition to salary and wages. Some employee benefits that you can offer are sick and annual leave, maternity leave, retirement fund contributions, incentives and bonuses, childcare benefits, healthcare benefits, and many more. Offering such benefits show your workers that you value and care for them on a more personal level. This will likely make them more loyal to your company, thus retaining them. If you are invested in your employees’ health and well-being, explore the different employee health insurance solutions that AXA has to offer.

3. Career development

Many Singaporean workers value career development, with 37% of employees spending one to two hours a week enhancing their professional skills, according to the 2019 Hays Asia Salary Guide. The Qualtrics survey also found that receiving the right training is an important driver of loyalty, with Singapore being the only country where this driver appeared so high. When you invest in your employees, they usually reciprocate by being loyal to your company.

HR, retention, attract, talents, employee, acquisition, group health insurance

The Ministry of Manpower offers a nationwide continuing education and training (CET) program to encourage Singaporean citizens and residents to upskill. Workers can take courses and programs under SkillsFuture and Singapore Workforce Skills Qualifications (WSQ) and upgrade their skills. By offering such programs, your firm also enjoys the benefits of having a highly-skilled workforce, thus maintaining its competitive advantage.

4. Good manager-employee relationship

Linda Teo, country manager for ManpowerGroup Singapore, noted that lack of engagement efforts by managers make workers feel like commodities instead of humans. It is thus essential for companies to enable managers and give them the tools and insights needed to improve employees’ experience. This can also complement efforts by the HR department to engage workers.

Steve Bennetts, Senior Principal Consultant from Qualtrics APJ, recommends a 360-degree feedback program for managers to get direct feedback from the team and identify key areas of development. Putting leadership development programs in place also helps to improve managers’ leadership skills, allowing them to better understand their team. A better relationship with management will make employees feel valued in the company and thus improve retention.

5. Personalized employee experience

A company’s workforce is now more diverse than ever – employees are from several different generations, with varying backgrounds and work experience. Therefore, a generic strategy to improve employee experience is no longer feasible. Linda Teo believes that retention initiatives should be personalized to each employee, firmly stating that the benefits of an engaged workforce outweigh the costs.

Kara Laine, Qualtrics XM Scientist, has the same sentiments, asserting that newer employees need a different approach from those who have been with the company for a longer time. If workers are engaged in the early stages of their employment, they are encouraged to stay longer. Consequently, the longer they stay, the more engaged they become.

Long-term Benefits

Employee retention efforts definitely do not come without a cost, but your company stands to gain immense long-term advantages. Several studies have long established the positive and significant relationship that job satisfaction has with performance, with an increase in job satisfaction leading to increased and better performance. Therefore, investing in your employees improves workplace productivity. A good overall employee experience also creates advocates for your company, building your reputation and attracting more talent to your company. 

Start taking the incremental steps towards a stronger employee retention strategy. Explore the various AXA healthcare solutions that cater to small businesses and medium-to-large entities, and protect your greatest assets.

References
Hays. "2019 HAYS ASIA SALARY GUIDE." 2019.
INSEAD, Adecco Group, Tata Communications. "2019 Global Talent Competitiveness Index." 2019.
Ministry of Manpower. Conditions Of Employment 2018. Singapore: Ministry of Manpower, 2019.
Ministry of Manpower. Skills, training and development. 2019. 2019.
Qualtrics XM. State of Play: Employee Experience in Singapore. Singapore: Qualtrics, 2018.
Robert Half. From salary to work-life balance: What motivates Singaporean workers? Singapore: Robert Half, 2018.

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