April 25, 2024

Top 4 Employee Retention Strategies for 2024

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Tags: HR

Key takeaways

  • Employee retention is an organization’s ability to prevent employee turnover (i.e., to prevent employees from leaving the company to work elsewhere).
  • Making more money is one of the main reasons that workers leave for a new job, so promotions are an effective employee retention strategy.
  • Fostering a positive company culture and giving employees recognition are two more important employee retention strategies.

Apr. 25, 2024: Kara Sherrer revised the copy for clarity and condensed repetitive sections. She also added a section on how to create your own employee retention strategy and incorporated software recommendations throughout the article.

Top 4 employee retention strategies

While the Great Resignation has somewhat fizzled out, 46% of employees still say they plan to look for work in the next three months. This should set off a few alarm bells — when experienced employees quit, the company loses valuable institutional knowledge. Remaining workers have to fill in the gaps and pick up the slack, which often leads to employee burnout, low morale, and declining productivity.

Even if you find qualified candidates to replace them, each new employee requires a lot of training and time to get up to speed. On the other hand, better employee retention curbs turnover and boosts team performance and job satisfaction — thereby contributing to the company’s bottom line.

But where to start? Some of the most common retention strategies focus on employee compensation, development opportunities, feedback, and recognition.

1. Review your compensation strategy

Compensation is one of the top reasons people look for new positions: In a recent LinkedIn survey, 36% of workers said that making more money is their main reason for quitting. In many cases, employees can get a 10–20% pay increase by switching jobs.

If your company can’t seem to get a handle on turnover or recruitment, take a look at your compensation strategy to see if your package is on par with competitors in your industry and geographic area. Use HR software like Bob to analyze salary data against internal and external benchmarks. A consistent, transparent compensation strategy ensures that everyone is being paid fairly and competitively.

Bob's compensation management dashboard displays sample data about a company's salary band ranges for junior, senior, mid-level, and head employees.
Bob gives you transparent information about salary bands, compa-ratios, and other compensation details so you can make strategic decisions to retain your best employees. Source: HiBob

2. Invest in employee development

If you want to reduce turnover and increase job satisfaction, then you need to provide the professional development and employee training that workers need to climb the ladder. This talent management can take many forms, including sending them to conferences, helping them earn certifications, and offering in-house training courses to help them upskill for higher-paying positions.

Get started with our Employee Development Plan: Complete Guide + Free Template

Learning management systems (LMS) make it possible to create development programs that align employee growth opportunities with the company’s business goals. For example, 360Learning identifies the skills and competencies required for each role, then monitors each employee’s skills progression. This level of transparency gives employees greater control over their own development, and managers can make objective decisions when team members are ready to advance.

360Learning displays a sample list of employees and their respective skills progression; a superimposed chart depicts 78 learners' current skills gaps as percentages of validated (62%) and missing (38%) skills.
360Learning’s upskilling campaigns provide an objective framework for each employee’s professional development and career growth. Source: 360Learning

Learn more: LMS Features You Need for a Great E-Learning Program

3. Engage in two-way feedback

Don’t wait for an exit interview to discover why voluntary turnover is happening — proactively identify employee pain points through anonymous employee surveys, one-on-one meetings, and other employee engagement strategies. Leverage this feedback to find out what would improve the employee experience, then work together to implement a solution.

Software like 15Five supports a culture of 360-degree feedback through quick and effective performance reviews and intelligent sentiment analysis. Managers can set up objective assessments to evaluate employees without performance biases creeping in, then leverage the actionable insights from employee surveys to improve their own effectiveness as leaders.

15Five's Outcomes Dashboard displays sample data about manager effectiveness, employee engagement, performance, and turnover with actionable insights to improve scores in each of those areas.
15Five recommends actions managers can take to increase engagement and retention on their teams. Source: 15Five

4. Recognize and reward employees’ contributions

All too often, companies focus on where employees need to improve and ignore the areas where they’re already succeeding. To that end, 71% of employees said they would be less likely to leave their organization if they were recognized more frequently.

Taking time to praise employees privately and publicly for their hard work shows them you’re paying attention to their wins in addition to their growth opportunities. However, offering rewards that employees actually want is key to improving employee experience.

Employee recognition software such as Awardco make it easier to launch, maintain, and grow your rewards program. Within the Awardco platform, employees receive points via social recognition, goal achievements, and service milestones, which they can then redeem for rewards like tangible gifts, company swag, gift certificates, and experiences.

How to create your own employee retention strategy

Survey employees

To create your own employee retention plan, you first need to figure out why employees are leaving. Exit interviews provide an opportunity to ask outgoing employees about their motivations, but employee engagement surveys offer a more proactive approach to gauge employee satisfaction. Ask questions about what employees like and dislike most about their current job, what would keep them at your company, and what would entice them to leave.

Identify retention opportunities

Once you have collected the survey data, compile the results and examine them for patterns. In most cases, a few popular responses will jump out as an overall theme; pick up to three areas to focus on first instead of trying to tackle everything at once. You can always come back later to address less-prominent themes.

Once you have identified your priorities, choose employee retention strategies that will help you accomplish those goals. For instance, if numerous employees said they would leave to pursue a higher salary, then reevaluating your compensation strategy should be your first order of business.

Assess your HR tech stack

Defining your employee retention strategy presents a good opportunity to examine your existing HR tech stack. You may find underutilized software modules that you can spin up to support your retention goals instead of signing up for additional tools. If there are gaps, however, assess whether an existing platform can be extended to meet your needs. In some cases, it may be worthwhile to explore standalone tools for learning and development, compensation management, and other critical retention efforts.

Monitor and adapt your retention efforts

The initiatives that keep employees engaged and invested in the company may become less effective over time, so your employee retention strategy must evolve to remain competitive in an ever-changing job market. Continue asking employees for frequent feedback and make changes as necessary; if turnover and attrition rates suddenly start to spike, it may be time to go back to the drawing board.

Employee retention FAQs

Employee retention refers to an organization’s ability to prevent employees from leaving the company. High turnover and/or attrition rates often signal challenges with retention, especially if it’s clear that employees are leaving because they’re unhappy in their roles.

Read more: 7 Warning Signs of an Unhappy Employee

Increasing the employee retention rate is a smart business strategy: It can cost between one-third and two times someone’s salary to find a replacement new hire, so retaining employees is significantly more cost-effective, even if it means giving them a raise. Talent retention also supports business continuity and helps employees build the skills and knowledge they need to drive better business outcomes.


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