That is a loaded question. And with the impact of COVID, WFH and industry ups-and-downs, employee turnover is even more complex.
Not Always About Money
Here is what I have learned over the years. Employees leave their employers when the job becomes a burden. That is sometimes due to the lack of compensation, but more typically employee turnover is driven by relationships with fellow employees or a manager. Lack of a trusting manager is high on that list. People do not enjoy being micromanaged and a steady diet of micromanagement is a huge incentive to start looking for something new.
Comfort and Boredom
Time in role is another contributor to employee turnover. Some employees grow to love their work and accustomed to what they are required to do. Others become bored and are ready for new challenges. Offering flexibility and growth assignments or projects can be good for both the comfortable and the bored.
External Drivers of Employee Turnover
There are so many outside drivers and influencers that can cause an employee departure. In today’s covid times, childcare is a major issue. If it is available, it may not be available consistently. Workers are reassessing what they make and what they spend. Couples are evaluating how time at work can have a negative impact on the quality of life for the full family. That is one scenario that leads to employee turnover. Still others are being impacted by work from home (WFH) requirements and options. Working couples have some very real issues when both parents are at home and there are children learning remotely…sometimes these situations drive change.
Money Can Impact Change
ADP does the ADP Workforce Vitality Report (WVR) which captures data on pay increases associated with job changes. In the 2nd quarter of 2021, those making job changes increased income by 5.8% on average. Those that stayed also saw increases but in the level of 3%. So, if someone is both unhappy with their work relationships and has other motivating factors, a change will be positive and more likely. For someone very pleased with their work, a 2 or 3% increase is not likely to drive a change of jobs with the same frequency.
Money is on the list, it is just not usually at the top of every job switcher’s list. Do not count money out as a cause for employee turnover, but assess all the conditions. Hold on to what you have; the cost of training, or worse, the prospects of an open position are a drain on company results as well as the employees that need to cover the open position.
People matter; make good choices to support valuable employees!