Editor's Note: This is the first installment of a two-part article. The conclusion of this article will be published in mid-July. Check back to Employee Matters section of ForConstructionPros.com to read the rest of this article.
Recently graduated from a top engineering program, Robert had a career on the rise within a large, international specialty-contracting firm. This bright young man successfully completed the company's three-year project manager training program and had become one of their most reliable and promising employees.
He was rewarded with the responsibility of managing and coordinating multi-million dollar projects and everyone expected Robert to be the firm's next superstar. So when Robert suddenly resigned his position to return to his home in the Midwest, his decision shocked his coworkers, including his manager. Ironically, if the firm had known about Robert's interest in changing locations, the company could have considered relocation. Somehow, communication had failed and the firm felt the sting of losing a project manager who was expected to play an important role in the growth of the company.
Like Robert, many good employees leave businesses bewildered - wondering what went wrong. But companies don't have to wait for employees to make the next move. By taking a proactive approach to developing an effective employee retention program, the anxiety of high turnover can be reduced. True, employee retention takes time, effort and resources, but the rewards can prove valuable.
The Importance of Retention
Retaining good employees is critical to a business' long-term success. And in the engineering and construction markets, employee retention is especially serious since the job market is tight and competition is fierce for top candidates. When you add the costs of recruiting and training employees, the financial impact alone is staggering. Some studies estimate that losing an employee costs a company 100 percent of that employee's salary. When reduced efficiency, lower effectiveness, workforce instability and lost productivity are added to the cost to find and train a new employee, the stakes become high. A company simply cannot afford to ignore employee retention.
Yet many well-meaning companies fail to invest in retention. The architecture/engineering/construction (A/E/C) industry is fast-paced, and businesses are scrambling in the day-to-day activities of bidding, estimating and managing projects. Making a commitment to retention seems like an impossible task when managers' plates are already full. But when businesses consider the long-term value of committing to employee retention, the effort is well worth the investment of time and resources.
One of the major drivers for investing in a retention program is the financial impact of recruiting and training valued employees. No less important is the effect on co-workers. When people leave a business, morale can be deeply impacted. Other employees may become fearful and uncertain about their status within the company. Such apprehension and insecurity can spread like a virus, and soon turnover may seem uncontrollable. High turnover also can give a business an unhealthy reputation in the marketplace, making recruiting future candidates especially difficult. To avoid these pitfalls and to keep moving toward success, companies must be willing to devote time, money and resources to understanding and implementing diverse employee retention strategies.
Effective Strategies for Retention
Understanding what motivates a person to look for another position is an important step. In creating an effective retention program, compensation and benefits are certainly factors in a person's job satisfaction, but a caring workplace where employees feel valued is critical. Companies have found that the reason employees look is not always the reason they leave. Why do some businesses do a better job of retaining employees than others? Keeping employees for the long term doesn't happen magically or by good luck. Rather, businesses must make a conscious effort toward employee development. The key lies in the planning. Companies that establish a clear, definitive strategy for retention will benefit tremendously. Below are some strategies that are invaluable in a retention program.