We’ve all heard old adages about why good employees quit:

“Money isn’t everything.”

“People don’t quit jobs, they quit bosses.”

You may be tempted to dismiss them as old sayings, but there’s more to it than that.

A quick Google search on why employees quit will reveal countless studies supporting these concepts. However, as is usually the case, the full story is more nuanced. It’s important to understand why people choose to quit, because it’s the first step for improving retention.

Putting the Retention Issue in Perspective

Now, we all know turnover is expensive. To put it in perspective, one study found that the median cost for replacing one employee is 21% of their annual salary.

Furthermore, if you don’t think retention is an issue at your company, you’re kidding yourself. A staggering 51% of the American workforce is either searching for new jobs or open to new opportunities.

With these numbers in mind, it is crucial that businesses strive to improve retention to cut down on these losses. Nearly every business could improve in this area. In order to address the issue, we have to understand why people are leaving in the first place.

I was curious about the subject myself, so I decided to perform a simple anonymous survey on the reasons why good employees quit. Respondents were asked to pick the primary reason for leaving their last employer. They were only allowed to pick a single reason from several choices.

A few weeks later, I had my answer. As I suspected, money was not the most common reason for why employees quit!

Top Ten Reasons why Good Employees Quit Their Jobs

  1. Lack of Appreciation or Recognition (20.17%)

  2. Money/Cash Compensation (15.00%)

  3. Lack of Opportunity (14.29%) – tied with #4

  4. Didn’t Get Along With My Manager (14.29%)tied with #3

  5. Ethical Concerns (9.29%)

  6. Complete Career Change/Function/Role Type (7.86%)

  7. Harassment of Any Kind (5.00%)

  8. Change in Personal Situation (4.29%) – tied with #9 and #10

  9. No Clear Objectives for My Role (4.29%) – tied with #8 and #10

  10. Location/Relocation (4.29%) – tied with #8 and #9

Bonus: Workplace Fling (0.71%) came in at #11.

Money Isn’t Everything – there are other reasons for why good employees quit

As the second most common reason cited, it is clear that money is still an important factor. However, we can’t lose sight of the fact that 85% of our survey respondents said they left a company for a different reason.

In other words, the vast majority of employees were leaving for a reason other than money! In fact, most of the reasons people chose to leave were factors that employers can control.

Paying a competitive salary is obviously an essential component of attracting and retaining talent in today’s cutthroat market. But even if you can’t pay employees more, there are plenty of other steps you can take to bolster retention.

Conversely, we can’t fall into the trap of thinking retention will improve if we throw more money at the problem.

As a veteran of the recruiting industry, you wouldn’t believe how many times I’ve come across individuals who are willing to take a considerable pay cut. Oftentimes, they’re more concerned with the employee experience or advancing their career than their salary.

It’s not all about money – and it never has been.

You Have More Control Over why good employees quit Than You Think

I mentioned above that employers can control most of the non-monetary reasons why employees are leaving – let’s dig into that a little further.

Sure, we might not be able to stop someone who leaves because of an office fling, or because they want to relocate to a different state.

However, I firmly believe that employers have a large degree of control over the following factors:

  • Lack of Appreciation or Recognition (20.17%)

  • Lack of Opportunity (14.29%)

  • Didn’t Get Along With My Manager (14.29%)

  • Ethical Concerns (9.29%)

  • Harassment of Any Kind (5.00%)

  • No Clear Objectives for My Role (4.29%)

When you total these responses together, you can see that employers can control 67.86% of the most common reasons for leaving a company!

Getting Creative With Retention Strategies

Now, it’s easier to see the solution to some retention issues than others. For instance, addressing a lack of appreciation or recognition is relatively straightforward. Likewise, it doesn’t take a strategic genius to see that the answer to harassment is strict disciplinary measures.

Other issues require a little more effort and creativity to solve. How do we address entry-level staff who feel they lack opportunity in a role? What about when an employee doesn’t get along with a manager?

Many leaders make the mistake of viewing these issues as simply a cost of doing business. However, that couldn’t be farther from the truth.

Think Outside the Box to Retain Top Performers

We know one of the top reasons why good employees quit is a lack of opportunity. In nearly every organization, there will be roles for which there is no traditional career ladder. Some organizations might not have an established career advancement path for secretaries. At other companies, the dead-end role may be data entry.

Regardless, the solution is to think outside the bounds of traditional career paths. If an employee shows an aptitude for a different role, let them try it for a few months. If they excel, give them the option to either stay in the new role or return to their prior position. You can also offer stipends to promote professional development and continuing education.

Lastly, you can offer entry-level employees new responsibilities and opportunities at the company if they have spare time. If they’re adding value to the company through these new duties, you might be able to promote them to a new role.

Not all advancements or opportunities need to be strictly vertical!

We Can Use People Analytics to Further Boost Retention

I can hear you thinking: “Okay, but we can’t really control it when someone doesn’t get along with their manager, right?”

Sure, there’s no way to make employees magically love their managers. And yes, there will always be conflicts and personality clashes in the office.

However, leaders often give little thought to group dynamics and employee relationships until they become an issue. Furthermore, we often treat all of our employees in much the same manner. Why do we do this? We know each employee has wildly different behavioral drives and needs in the workplace. Inevitably, this strains relationships in the workplace and creates unnecessary stress.

People analytics offer immense value in this area. These tools give us a scientifically validated method to understand what drives an individual. With analytics, we can gain insight into the unique needs a person may have in the workplace. They give us concrete data on group dynamics, and help us understand how to manage employees so that they’re more satisfied in the workplace.

People Analytics Boosts Retention – as Well as Engagement and Performance

Ultimately, that’s the value of people analytics – empowering you to drive retention, engagement, and performance with your staff. These advanced tools allow us to gain data on a given employee than we could ever learn from interviews, resumes, or first-hand experience with their work style.

When we understand what drives an individual, we can better understand how to make them feel valued and appreciated in the workplace. By understanding their particular needs, we can help provide a satisfying and fulfilling employee experience. In short, it allows us to develop highly effective strategies for retaining and engaging talent that we can’t afford to lose.

Businesses and leaders alike shouldn’t be judged based on a poor retention rate. Every organization will have their ups and downs with talent drain. Sometimes we can control why good employees quit, sometimes we can’t.

A more accurate measure of a business and its leaders is how they respond to poor retention. Do they tackle the problem head on, or wait and hope it resolves itself?

More often than not, this decision is the difference between success and failure.

Contact us today to learn more about how to address employee retention at your organization.

The right people, empowered to perform.