Executive summary
The rate at which an economy hires new employees to replace other employees who have left employment is referred to as the labor turnover rate. The United States Bureau of Labor Statistics has been tasked with the responsibility of tracking the national average of the labor turnover rate. The bureau in the month of June 2011 found the turnover rate to be just about 3.1 percent in a statistics that was said to be 1.2% increase from the May 2011 averages. Different industries have also been found to have different turnover rates. The hospitality, restaurant and manufacturing industries have been found to have high employee turnover rates. The question remains as to why employees have been found to leave employment and seek the same elsewhere. This research paper will seek to explain why employees leave employment. The research paper will also provide an analysis of measures taken by different organizations to retain employees.
Introduction
The United States business environment has been under constant shift. The 2008 economic crisis has had the business fraternity rather concerned about the performance of their operations. In this regard, businesses have had to adjust their human resource practices and this has largely affected the manner in which employee work for organizations. In general though, employees are allowed to leave an organization at their own will. There are several reasons that make employees leave a company and seek employment elsewhere. While some employees may leave the company due to poor management and conflicts within the organizations, other employees leave the organization due to personal reasons that may not be attributed to management.
General reasons for Employee Turnover
As earlier stated, there are several reasons that make employees seek employment elsewhere. While some of the reasons may be personal reasons that, most of the reasons have been attributed to poor management methods and unfavorable working conditions for the employees . Some of the reasons that can be attributed to management include poor micro management practices especially in supervisions, favoritism and nepotism and overworking the employees.
Bad Supervision
Most businesses in the United States rely on micro management by supervisors at different levels for the day to day running of the business. Supervisors provide a link between the senior management and the employees. Thus supervisors have a one to one relation with the employees and thus in big part represents the senior management. However, it is at the supervision level that has made most employees leave their employment . Supervisors who monitor every move of the employees have been found to be main cause of such employee resentment. In the same regard, supervisors who display strict management methods have been seen to be stumbling block between the employees and senior management and thus the efforts of the employees are seen to go unappreciated. In such a working environment, employees who get the first chance to leave the organization do so at the first chance. This is common in the manufacturing industry, restaurants and hospitality. Statistics have indicated that restaurants especially fast foods restaurants have as high as 56% turnover rate per annum .
Discrimination and Favoritism
High turnover rates have also been associated with discrimination and favoritism. Here, it has been established that businesses that are family owned have the employees unsure whether they have any chance of improving their working levels. In such companies, there is a real assumption that even if an employee works with undivided attention, family members will always have priority over the rest. In general however, if the management is found to be treating other employee differently from the others, then such a firm should expect high turnover rates.
Excess workload or poor workload distribution
Some workplaces have been perceived to have excess workloads, and most of these perceptions have been found to be true. For instance, child welfare organizations, especially those run by the government have been associated with high workloads . This working situation has the employees on edge and ready to leave the company at the very first instance. Additionally, in some cases the management is found to give different workloads to different employees. This unfair distribution of work gives less fortunate employee reasons enough to leave employment and seek work elsewhere increasing the turnover rates.
Impacts of high turnover rates
A high turnover rate for a business has serious implications. First the cost of high turnover rates is very high due to the expenses associated with frequent changes in the employees. These costs include advertising, hiring and training of the new employees. In this regard, a company has to take some time off to seek other employees, take them through interviews, recruiting and train such employees for their respective jobs. On the other hand, losing experienced employees can be viewed as ‘brain drain’ of the company and thus the company losses its competitive edge among its peers. There are other hidden cost and implications of high turnovers rates. Some of these include stress among those left in the company and low working morale. A grave danger is the impact on the young employees when their mentors leave the company, young and energetic employees need work with experienced employees. Thus high turnover rates diminish their will to work harder.
Retaining employees
Thus every management has the responsibility of working towards reducing their turnover rates. There are several measures that an organization can take towards retaining their employees. Magloff (2012) suggests that the first measure that a management can employ is to review salaries and benefits of the employees frequently. Here, the management should take measures to offer competitive salaries and benefits as compared to industry practices. The management should also consider other incentives such as bonuses and paid leaves for vacations.
Another measure that can be taken is improving the working relationship between the management and the employees. Businesses and the management have the responsibility of ensuring that the organization works as a team. This implies that senior management must find a way of working with low level employees in ample relations. For this to happen, businesses have to set up seminars and conferences that seek to address relations within the organization. The management also has the mandate of setting up mechanisms that address conflicts in the organization in a fair manner.
Conclusion
Employees play a very important role in the organization. They run the business and are seen as the face of the business. For this reason, businesses have the responsibility of ensuring that the employees are happy at the work place. A business can achieve this by providing plausible incentives and good working relations.
References
Blank, C. (2011). What Does a High Turnover Rate Say About Management? Retrieved July 23, 2012, from http://smallbusiness.chron.com: http://smallbusiness.chron.com/high-turnover-rate-say-management-26043.html
Magloff, L. (2012). Employee Turnover in Organizations. Retrieved July 23, 2012, from http://smallbusiness.chron.com: http://smallbusiness.chron.com/employee-turnover-organizations-12002.html
