How employee engagement can help reduce turnover and drive retention

Employee retention is so much more than just a metric. It’s a testament to people’s feeling of commitment, engagement, and enjoyment when it comes to their work. As a result, high levels of employee retention can signal a strong business and company culture.

For many employers, retaining talent is one of the primary operational priorities on the leadership agenda in 2024 — and for good reason. Between 2022 and 2023, the average voluntary turnover rate for American businesses was 17.3 percent, and according to a recent GOBankingRates survey of more than 1,000 American adults, 58 percent are planning a major career change in the coming year.

Here’s a more detailed look at what’s driving this changeover in the workforce, and what companies can do to help keep their talent happy.

Employee turnover costs companies in more ways than one

When employees leave, it’s a loss on multiple levels. First, it suggests another organization had the resources and resolve to make them a better offer, which may not bode well for future recruitment efforts.

Second, the loss of an employee leaves a hole in the team that their co-workers might have to fill before a replacement can be found, which can detract from their own job satisfaction and impact their work-life balance.

And third, as turnover takes a toll on the morale of the team members left behind, they may also start to evaluate other employment options available to them.

But the most immediately noticeable and measurable costs are monetary. According to the Integrated Benefits Institute, 61 percent of employers report problems retaining staff, and the average cost they incur due to turnover is equivalent to one to two times the employee's salary. However, by investing in employee retention strategies, employers can help reduce this financial impact. For example, a recent report from Workhuman claims that a 10,000-person organization with an engaged workforce can save up to $16.1 million annually due to turnover reduction.

To counter the adverse effects of employee loss, there are actionable steps organizations can take to help increase their rates of employee retention.

Keeping your talent happy means keeping your talent

In the past year, 34 percent of managers in the United States have experienced increased turnover. It should come as no surprise, then, to learn that a survey of human resources professionals targeted employee retention as the top priority for 2024, with mental health and wellbeing identified as the most important areas for support.

And they’re right. The October 2023 TELUS Mental Health Index surveyed 5,000 working individuals in the United States and found that 20 percent reported an anxiety diagnosis, leading to a productivity loss of the equivalent of 47.4 working days per year.

Employers are taking note, too. In 2024, according to one survey, 91 percent of employers say they will invest more in mental health, 66 percent say they will invest more in stress management and resilience, and more than half say they will also increase investments in mindfulness, financial wellness, and telemedicine support.

Such benefits provide two important incentives for employees to stay with their organization. They empower employees to connect with medical professionals to help address their mental health concerns, while the on-demand flexibility of digital health services can contribute to a better work-life balance. And with 72 percent of employees prioritizing their energy outside of work, it’s vital for organizations to provide easy-to-access services that facilitate this balance.

Without a concerted effort on the part of employers to retain their workforce, people may start to look elsewhere. Employees have grown increasingly unhappy in their roles, with the employee net promoter score declining at a rate of 6 percent between 2020 and 2022 — and in 2023, it declined at a rate 10 times faster than the previous three years.

A healthier lifestyle takes center stage for the workforce

Just how important is work-life balance for employees? One study shows that 47 percent of employees are actively seeking a new job because of a desire for more flexibility, while another study found that 79 percent consider flexible work options as being the most important to overall job satisfaction.

Salary is also critical, and pay continues to be a key factor for employers who wish to remain competitive. In addition, non-monetary actions are a big focus for employers looking to attract and retain talent. At most organizations, these include more workplace flexibility (63 percent), broader emphasis on diversity, equity and inclusion (DEI) (60 percent), and an improvement of the employee experience (55 percent).

All of this research demonstrates that when it comes to retention, companies would do well to focus on holistic support for employee health and wellbeing.

Benefits matter almost as much as salary

Employees are serious about taking care of themselves, with 33 percent wanting better control over their health. When employees know that they’re cared for, they’re more likely to be happy and secure in their jobs, and have more reasons to stay.

Services like TELUS Health Telemedicine can help meet those employee needs. The comprehensive virtual healthcare solution offers personalized support from compassionate clinicians for triage, treatments, prescriptions and referrals to specialists.

Meanwhile, programs such as TELUS Health EAP allow one-click access to additional mental health services to support multiple aspects of life — from child and elder care support to legal and financial advice. And TELUS Health Wellbeing lets employees take an app-based approach to helping develop and maintain lifestyle habits, while inspiring users to achieve their personal health and wellbeing goals.

These types of services and solutions help create a positive company culture where employees can stay and thrive in their positions.

Learn more about how TELUS Health can help support employee engagement and drive retention in your organization here.