How to Reduce Employee Turnover as a Faith Driven Entrepreneur

Well-known business experts and global entrepreneurs regularly contribute to the Faith Driven Entrepreneur blog and podcast. As stewards of these archives, we’ve curated a number of voices to provide you with diverse perspectives on popular business topics. Our intent is that these fresh pieces of wisdom will guide you as you faithfully pursue your own business journey.

Since 2020, The Great Resignation has affected nearly every industry. As workers leave their employers in droves, executives have scrambled to figure out why people are quitting and how to make them stay. The front pages of every business magazine have been packed with think pieces and articles trying to answer this question.

The turnover situation is dire: the economy has seen a 57% employee turnover rate over the past year. Companies facing serious labor shortages are willing to try almost any retention strategy. However, no one has found a sustainable solution.

Faith Driven Entrepreneurs may be able to provide a unique perspective on this issue. What if we could pair the best efficiency models and hiring practices with the virtues of self-sacrifice and love. As followers of Christ, we are called to love our neighbors (and employees). But what does that look like in practice?

For those of you wondering how to reduce employee turnover, we’ve curated bits of wisdom from our faith driven contributors, CEOs in the field actively working to love their employees well. As it turns out, a faith driven approach to employee turnover can be wildly effective in reducing operational costs and boosting team morale.

Why Retaining Employees is an Important Goal for Businesses

Cost

The most obvious downside of employee turnover is cost. One HR report by SHRM says the average cost to replace an employee is $4,425. Ad space on Indeed, HR specialists on staff, and background checks all contribute to the price of making a new hire.

And that $4,425 is just the average cost across all employees. Want to hire a new executive? You may be looking at a $15,000 price tag.

Lost Production

Turnover affects company efficiency in two ways. First, when an employee leaves, you lose that employee’s highly-specialized knowledge. It takes time to hire someone with the required qualifications. It takes even more time to train them and introduce them to your teammates.

Second, your team managers could be working on client projects, but instead, they’re sitting in a third-round interview. Entire teams lose momentum when they’re asked to participate in the hiring process. Any team chemistry must be rebuilt from the ground up.

Morale

Dissatisfaction is contagious. According to Denise Rousseau, a Carnegie Mellon professor, “When a worker of a similar skill level quits, another employee may see that as a sign that there's plenty of job availability; when a manager leaves, their direct reports may feel less tied to their jobs or feel resistant to working under new leadership.” When employees leave your company, the remaining people naturally ask, “Why?” which may lead to more critical perspectives.

Brand and Reputation

When people change jobs, they talk about it with friends and family. If enough employees leave your company, especially if your company hires hundreds or thousands of people, you may notice you’re not attracting the same quality of candidates you used to. That’s because they heard through the grapevine that your business isn’t worth working for. While people leave jobs for all kinds of reasons, it’s important to minimize turnover rooted in negative experiences.

Why Employees are Quitting Your Business

In order to fix a problem, you must understand the problem’s cause. Except in this case, the “problem” is people, who are complex, nuanced beings created in the image of God. If one-size-fits-all approaches worked (pay more money for instance), we would have seen an end to the Great Resignation articles and we might be seeing the end of steady competitive wage inflation.

To summarize our findings, the best course of action is to support employees’ “personhood” and not treat them like cogs in the machine. The following topics should explain more of what we mean. So, why are employees quitting their jobs?

Employees Don’t Feel Seen

One Inc. article reminds us that “77 percent of workers shared that loyalty to their company remains high when their recognition needs are fulfilled.” When people put in the effort and don’t receive any acknowledgment, they’re more likely to become burnt out and unhappy. This is especially true for remote workers who can fly under the recognition radar.

Employees See Failures in Leadership

A failure of leadership doesn’t always entail a deep moral failure. Yes, employees are likely to leave a company after a scandal, but we’re more talking about management failures. For example, Jon Christiansen writes for the Harvard Business Review that inconsistent expectations, too many process restraints, and leading with bias can decimate employee morale.

Employees Experience Too Many Work-Life Boundaries

It’s always important to make sure employees feel as though they have the right to keep work separate from their personal lives. But that said, many people leave employers for reasons completely separate from work. One highly-qualified HR expert says, “The big realization is that it’s not just what happens at work—it’s what happens in someone’s personal life that determines when he or she decides to look for a new job.” Anniversaries, illness, tragedies – these may push someone to rethink their life and search for change in their life.

Employee Retention Tips from Faith Driven Entrepreneurs

Here are five tactics to consider in order to reduce employee turnover.

Loving Employees is at the Heart of Reducing Employee Turnover

In the end, it’s not all that farfetched to say that reducing employee turnover is rooted in love. How can we as entrepreneurs love our employees in order to create a sense of belonging and serve customers through excellent products and services?

This probably isn’t the first article you’ve read about The Great Resignation. We hope that this article provides new perspectives on employee retention. However, the challenge now is to get up and put these tips into practice.

If you’re wondering where to start or if this challenge sounds overwhelming, join one of our Foundation Groups. Join a group of other business leaders and dive into rich content while developing relationships. You don’t have to do it alone. Click here to learn more.