8 Proven Employee Retention Strategies in 2026

Wouldn't it be nice if the word turnover only referred to a small pie?

The reality for HR leaders isn't so sweet.

47% of HR professionals said employee retention was the top talent management challenge they faced, closely followed by recruitment at 36%.

It's no surprise that these two are linked: It's much less expensive to retain a productive employee than it is to recruit one.

But what can you do?

It'd be nice to increase everyone's salary, but that isn't happening anytime soon.

And those competitors with the money to lure away your best candidates aren't making things any easier.

The average compensation increase for an employee who takes another job is 15%. And chances are slim those workers will get that kind of pay bump in their current role without a promotion.

Employee retention relies on a combination of factors, including flexible work arrangements, benefits, professional development opportunities, advancement opportunities, company culture, and more.

To help you round out your employee retention program, we've put together a list of the top causes of employee turnover and a detailed plan for how to address them.

1. Create professional development opportunities

94% of employees surveyed by LinkedIn for its annual Workplace Learning Report said they would stay at a company longer if it invested in their professional development.

Businesses that don't provide these internal training opportunities miss out on an exciting opportunity to address the global skills shortage.

75% of employers who report recruiting difficulties say it's challenging to find candidates with the skills they need.

To compensate, many companies are offering internal training opportunities to upskill their existing workforce.

Of course, this employee retention strategy is most successful with curious, motivated employees.

Sparkbay makes it easy to go to one spot and have a bird's eye view of what's happening. Each manager can pinpoint the goods and where to improve.

How NARS reduced turnover by 10% with Sparkbay

Learn more

How you can do that:

The simple answer: You need a learning and development program.

The complicated answer: You need an effective learning and development program.

But what does this mean?

It means you can't just throw a program together overnight and consider the problem solved.

Keep in mind that 90% of companies offer digital learning today, so it's not that professional development opportunities don't exist. It's that they aren't designed properly.

Just because you've identified the desire for learning and development within your company, doesn't mean your workers will settle for anything.

It's essential to understand how your employees prefer to learn and design carefully structured professional development opportunities.

Corporate learning tech is a popular tool among HR teams. They allow companies to easily deliver educational content at scale.

But do employees actually use these?

Clunky systems tempt employees to look outside the organization for more consumer-friendly tools like Coursera, Udacity, and even YouTube.

As a result, employees forget that corporate solutions exist or don't associate their company with employee development initiatives at all.

Understand the learning preferences of your employees.

For instance, LinkedIn found that 68% of employees prefer to learn at work, while 58% of employees prefer to learn at their own pace.

It's data points like this that can help you make critical decisions like which e-learning tool to choose, and how often to offer workshops.

Another option is to provide tuition assistance.

Your organization may not be equipped to offer in-house training, but you can support your employees by subsidizing their education.

This tuition can either be limited to specific courses and credentials valuable to your organization or unrestricted.

2. Make sure managers are not compelling great employees to leave

You've likely heard the expression, "People leave managers, not companies."

Management affects how engaged employees are, and therefore, how likely they are to stay at your company.

But let's dig a little deeper.

What exactly don't employees like about their managers?

There are blatant transgressions like playing favorites, making inappropriate advances, or making informal threats.

But there are also more subtle reasons an employee leaves their manager.

They can range from feeling a lack of development opportunities to not feeling appreciated to feeling micromanaged.

How can you and your managers pinpoint the biggest pain points for employees and proactively address them?

What can you do about that?

You don't have to be a mind reader to know your talent's true intent. You can figure out how your employees feel by collecting feedback regularly.

An annual review is not enough. Great people leaders regularly collect feedback from their employees. Try to schedule monthly or biweekly touch points with your employees.

If possible, use anonymous feedback tools to make your people feel at ease.

Make it clear that this is a safe space for your people to share their honest opinion.

Be mindful of how you react to employee feedback. This will determine whether they feel comfortable sharing feedback moving forward.

This is your opportunity to focus your efforts:

If your employees feel like they aren't appreciated, you can work on acknowledging their efforts.

If they feel like there are no clear advancement opportunities, it's time to figure out a clear career progression path.

If you take too long, they may view it as a sign that their concerns are not a priority and that it's time to explore other career opportunities.

3. Create career advancement opportunities

Good employees want to advance in their career. They are motivated by the prospect of promotions, and the chance to take on more challenging work.

Employees who remain in the same role for an extended period are more likely to leave an organization.

In fact, for every 10 months an employee stays in a position, their chances of quitting increase by 1%.

For many companies, policies about the frequency and nature of promotions as well as other contributing factors impact whether they can offer promotions or not.

Even if an employee deserves more responsibilities, their employer may be unable to provide it.

Often, these circumstances aren't communicated to employees, or if they are, they're perceived as stall tactics. In response, these employees start looking for opportunities elsewhere.

How can you combat the issue of employee stagnation and reduce its impact on employee retention?

Don’t make management the only ladder employees can climb

There is a misconception in business culture that people management is the only way to advance one’s career.

You can create a dual-track career path like Microsoft and Google.

At each level of the career ladder, people in these roles hold equivalent pay, similar levels of influence and equivalent levels of expectations.

In that structure, a junior employee starts out as an entry-level contributor.

But as they gain skills and prove their effectiveness, they can move up the ladder of promotions, benefits, and influence without ever becoming a people manager.

This helps you retain high-quality talent, prepare them to serve as mentors, and benefit from their expertise.

All of this, without demanding that they get good at people-management skills, which may not fit with their talents.

Of course, if you have vacant manager positions — and an employee has the necessary leadership and people-management skills — don’t wait simply because the employee isn’t up for a promotion yet.

4. Improve the onboarding process

Imagine going through the highly expensive process of recruiting a new employee only to lose them within the first two months.

You hired the person, so it means that they possessed the skills required to get the job done. And they likely checked out with a range of stakeholders during the interview process.

Losing a new employee potentially points to a poor onboarding process.

76% of respondents' workplaces aren't onboarding their new hires properly, while only 47 % believed their onboarding program effectively retained new employees.

When there's no onboarding process at all, there's a higher employee turnover rate and lower productivity levels.

How you can improve onboarding:

The key to a successful onboarding process is capturing a new employee's excitement about starting a new job while minimizing other challenges.

When people start a new job, they're eager to learn and start generating value.

But frustrations around how to do something as small as print to what the expectations are for the first month can lead to uncertainty and anxiety.

Create a program that's about integrating new hires into the company culture.

It shouldn't just be a guided paperwork session.

In fact, 40% of onboarding activities consist of filling out paperwork.

Ahead of it on the list were activities like reviewing regulations or listening to an overview of the company.

It's also essential to signal the importance of employee onboarding activities from the top down.

The top reason onboarding activities don't get completed is that managers don't have time to carry them out. It's fair to say that were it mandatory, managers would make the time.

Too often, it's considered a throwaway responsibility that can be sacrificed at the altar of business-as-usual activities.

5. Monitor turnover risks

Employee retention isn't something that you build and then stop working on.

You have to be in constant communication with your employees to make sure their expectations are met and they're currently happy at your organization.

This is especially true during times of change.

Here's how we can help you improve employee retention:

Our platform automatically surveys your employees at regular intervals (70% of our clients opt for monthly surveys).

Using this data Sparkbay captures trends and alerts you in real-time when an employee segment shows an increased risk of turnover.

Sparkbay also uses data from recently departed employees to uncover the real causes behind turnover, empowering you to take early action and address the issues that matter before it’s too late.

We also created a library of easy-to-implement actions from the most successful organizations to help you and your team managers learn how to prevent turnover.

If you're interested in learning how Sparkbay can help you retain your talent, you can click here for a demo.

6. Make sure your employees are appreciated and recognized

A sobering 66% of employees say they would quit their job if they felt unappreciated. According to one Gallup poll, 65% of people feel unappreciated at their job.

Meanwhile, another study discovered that the office comes in last on the list of places where people express gratitude. Side by side, those statistics indicate there's a lot of work to do.

One potential cause for this disconnect is "emotional stinginess". Whether it's due to their professional development or their personal temperament, some managers don't show gratitude, which leaves their employees feeling underappreciated.

Add overworked employees under a lot of pressure, and you've got a recipe for turnover.

What are some of the warning signs that your employees feel undervalued?

They're suddenly withdrawn.

They're no longer enthusiastic about new projects or company initiatives.

They come to work "checked-out" (otherwise known as the art of doing the bare minimum).

How you can improve employee recognition:

To succeed, your employee appreciation initiatives need to be consistent, sincere, and organic.

A few common mistakes HR leaders make when trying to improve recognition are:

• Thanking people on autopilot by going around at the end of each day to thank everyone on the team one by one
• Overcompensating by making a dramatic shift from never thanking anyone to suddenly thanking everyone for everything
• Delivering conditional thank yous that are closely followed by a negative comment

If you want to improve employee appreciation, you need to build a culture of recognition rather than trying to gamify the process through a point system.

Invite managers and employees to write personal notes to their colleagues recognizing what they did well and explaining why it was important.

Present the recognition publicly either during in-person events or on internal networks that allow you to broadcast a colleague's accomplishments.

And create annual awards where recognized employees are honored in front of their peers and senior management.

7. Make sure your employees don't feel overworked and overwhelmed

If someone told you that working at Company A would reduce your life expectancy by even 1%, you'd likely take a job somewhere else.

Researchers from Harvard and Stanford found that long hours decrease a person's life expectancy by roughly 20%.

Given the demand for talented workers and a renewed cultural focus on health and wellness, few workers are willing to tolerate such conditions.

A report from Morneau Shepell found that 40% of managers and 34% of employees suffer from "extreme levels of stress".

Overworking employees is a short-term strategy that isn't worth the long-term pain.

What's more, overworking employees simply isn't a smart management strategy.

Research shows that after a certain point, productivity declines for every additional hour.

Moreover, employees who are stressed and overworked fall ill more frequently and make expensive mistakes.

It's an untenable environment.

Sure, there may be short-term wins in the form of completed projects.

But over time it hurts employee job satisfaction and eats into a company's recruitment and retention costs as burnt-out employees leave and share their experience with other candidates.

How you can do that:

Sometimes, pulling a few extra hours is necessary, but how often is too often?

There are a few revealing signs that your employees are overworked.

If your keycards system logs people leaving late at night or clocking in shortly after sunrise, it's a sign that their workload may be too high.

Another warning sign is hearing employees lament about missing family events.

That one's no joke. According to that joint Harvard-Stanford research mentioned earlier, work-family conflicts increase the chances of poor physical health by 90%.

Often, good employees don't want to admit they're overworked either due to embarrassment or the need to please.

When it becomes too much, their solution is to find a new role elsewhere, which is the least optimal outcome for your company.

Such a dialogue provides an environment for workers to speak freely about their workload and to request the support they need.

In some cases, a manager may not be aware that an employee's overworked - because they're overworked themselves.

Another employee retention strategy is to encourage workers to take time off.

Employees often feel pressured not to take vacation time either because of their workload or fear of being overlooked for interesting assignments when they return.

Creating an atmosphere in which managers encourage employees to use their unused paid time off creates opportunities for guilt-free rest and relaxation.

Finally, it may be time to increase headcount or radically prioritize.

If asking employees to sacrifice their weekends is the only way to keep the company operational, it's time for a re-evaluation.

You may need to hire more people. And if hiring simply isn't an option, then it's time for some radical re-prioritization of tasks on a team's docket.

8. Create flexible working arrangements

In some professions, there's an expectation that employees will be available 24/7.

This expectation freezes out many people who would otherwise bring all the skills these organizations require.

These demands to be physically present at set hours can lead to a drain of talent and resources over time.

Especially when people working from home are as productive as those who remain at the office.

Remote working also reduces one of the biggest pain point of coming into the office: commuting. 23% of workers have quit their job because of a bad commute.

What can you do about that?

Business leaders should embrace remote working and flexible hours.

This isn't possible in some industries where front-of-line staff is required at all times for customer service.

But if your employees work in terms of deliverables, not face time, let them decide where they work best.

One financial services company lets any employee leave as early, arrive as late, and work from home as often as they like with no questions asked. So long as their work gets done.

If you can't take things that far, consider conditional flexibility.

For instance, the ability to work from home two days a week with the option to switch those days each week.

And offering flexible hours allows people to create a work schedule that works for them.

What's better?

An employee who works only from 9 to 5, or an employee who works evenings and weekends but takes the liberty of leaving at 3:30 so they can pick up their kid before remote working for the rest of the night?

Give your employees a little leeway, and they'll give you a lot of loyalty.

What's more, this employee retention strategy will improve your recruitment efforts since flexible work arrangements allow you to access a new pool of highly qualified candidates.

Offer competitive compensation and benefits to your employees

Pay is often the number one reason people say they're leaving, even when it isn't. This is one of the main reasons employee retention strategies allocate their budget towards the wrong initiatives.

Employee retention relies on more than just the "absolute" level of pay. It depends on the "relative" level of pay. Employees' internal comparisons determine their perception of fairness.

With pay-transparency laws, this is even more critical. Employees may feel underpaid if their yearly salary is close to the starting pay listed in their job posting's newly published pay range, despite their salary being at market.

Author Daniel H. Pink explained in his book Drive, that the purpose of pay is to "take money off the table." In other words, you want to eliminate the temptation to focus on money while performing. Achieving a high pay level may not be as important as getting money out of the suspects of "money talk".

As Frederick Herzberg's research summarized in The Motivation to Work revealed, money is a "hygiene factor," which means that while lower levels of money create dissatisfaction, higher levels of money do not necessarily create long-term commitment. Although there is debate over this within the employee retention world. For instance, a money increase tied to a promotion or explicit recognition can energize employees for reasons other than the money itself.

While offering a raise may solve one reason for attrition, it may not be a solution for another root issue like poor management, lack of growth opportunities, or an unsustainable workload. If you raise the pay in response to people considering leaving, you risk creating a ladder of how people can get a raise: threatening to resign.

So before dedicating your budget, make sure "pay" is really the cause for attrition and not a polite way to say goodbye.

• Exit and stay interview themes: Your exit interviews may overemphasize pay as a reason for leaving (since it is the easiest answer for employees to give that doesn't burn bridges). If pay is brought up, ask employees what number would've kept them around. If they can't provide a number, it's likely not the main reason they left. Give your stay interviews more weight.
• Where leavers go: Check the title and pay of the new jobs your employees acquire. If they're signing on for a lateral role, but are asking for a huge pay increase, it's a sign salary could be an issue. If they're moving up a level in terms of title for a modest pay increase, it could be a sign they feel there is a progression issue that offering them more money won't fix.
• Counteroffer outcomes: Track employees who accept counteroffers as a separate group. If they don't stick around for a long period of time (e.g., within a year or so) it's a sign that the money was masking another problem. You may need to move this budget to pre-emptive initiatives rather than money counteroffers.
• Clusters by team: If complaints about pay are reported but seem to be clustered under certain managers while employee compensation ratios are similar to other teams, it's likely the issue is how managers communicate the pay decision or their merit pay discretion, not the compensation itself.

If you're feeling data rich but insight poor during your compensation benchmarking activities, you could have a compromised sample.

For instance, your job matching activities could have resulted in jobs being matched to a level lower than they should be. This would make you believe your role is "at market" when you're actually losing people over pay.

For jobs requiring scarce skills, look at less tangible benchmarking data. If you know you're losing employees in these roles based on declined job offers and feedback from your recruitment team, you can make a more informed assessment of your market data.

When comparing compensation, consider the total compensation in terms of base, incentives, and equity. Further, look at the "realistic" value of these items as opposed to the "target" value. If you've consistently delivered bonuses below the target bonus for a number of years, your employees may already be discounting value of their bonus.

Similarly, if equity is often underwater or illiquid, employees may view it with zero value.

Then, explore your compa-ratio distribution within bands, considering factors like tenure, current manager, and gender - this is an area that many organizations are focusing on due to increased pay equity reporting.

Assess salary compression among current employees, particularly those who are great performers and were hired shortly before a major market jump. If employees in these circumstances are making as much or more money than their manager, it's a sign things have gone too far.

Plus, a lot of things get disclosed through the grapevine, so there's a good chance your tenured staff will find out one way or another.

Do you intend to raise your hiring range? Be sure to secure the appropriate approval for fixing the compensation of your other current employees at the same time. If these happen separately, your hiring range approval flows through to hiring but may put existing employee adjustments on the back burner, which creates the compensation problems you were trying to avoid.

Within your budget, you can't do everything. This means that a universal increase in compensation for all employees within a specified band may reward some employees who are already at the higher end of that band and still leave others in a precarious compensation situation below market.

Prioritize directing your funds to roles that are both hard to replace and in high external demand. Then, you can explain to others the criteria you used to arrive at this decision, recognizing that most people will understand the rationale if they see it rather than a rote division of employees into equal parts.

Conduct your salary review discussions on a fixed schedule (e.g., annually). If there is an opportunity to conduct an off-cycle compensation review, that opportunity should be outlined in advance and include pre-defined triggers (e.g., substantial expansion of the employee's role or activity in the market). Otherwise, off-cycle compensation discussions may reward - intentionally or not - employees who use them as leverage for a raise or retention.

Provide managers with an escalation path and clear evidence threshold for escalating pay-related concerns. Educate employees on how pay decisions are made.

Provide your managers with the entire compensation range, where their employees sit in the band, and what they need to do to move up in the band. Many organizations keep this information from their managers, so "It's not up to me" becomes the only honest answer to employees' questions. This damages trust more than even a small raise would've done.

Use the methods outlined above to understand your compensation structure. This isn't intended to be a guide to promising your employees an increase at each review. Instead, it's about being able to clearly and confidently explain compensation decisions.

When it comes to designing employee benefits, the ideal benefits for employee retention are those that competitor organizations will have a difficult time emulating or whose value increases over time with their tenure at your organization.

A generic perks offering is easily matched by any competitor. And an employee development budget that involves a cumbersome approval process (three step approval process!) may not even get used!

While you should monitor participation levels, don't limit your views on success to raw participation numbers. While few people might take advantage of a fertility benefit, carer support, or specialist health support, these benefits may be incredibly important for those people. It's worth providing and evaluating on the basis of this pool of use.

Employees often don't realize the true value of their benefits, especially those portions paid by the employer that employees don't even see. A simple, annual total rewards statement that makes employees aware of the value of their compensation is a great tool to deliver that message.

This is another great platform to deliver a message to your employees about their "realistic" compensation values in advance of your pay discussions.

Employees are sometimes more willing to accept targeted retention bonuses to help the organization through critical transitions such as system migrations or leadership changes.

If you can, tie the retention bonus to the delivery of a milestone rather than the achievement of a date, and put the terms in writing.

The offering of retention bonuses also raises a cliff effect. Employees may decide to leave soon after receiving their retention bonus. To limit the likelihood of all key employees leaving at the same time, stagger payout dates among your group.

Ensure that you have a clear understanding of the employee's next role before a payout so that you don't trigger another retention bonus discussion.

How do you know your program to improve employee retention is working?

First, lock down your definitions and methodology. Consider the following:

• How do you calculate the denominator of your turnover rate? Will you take an average of headcounts at the end of each month, or use the average of the number of people at the start and the number at the end as your denominator? This is important as it impacts your baseline measurement.
• What counts as a voluntary turnover?
• What factors lead you to classify a turnover as a regretted turnover?

Finalizing these definitions is critical because your data systems may change or your definitions may change due to changes like HRIS migrations or organizational changes. You want to make sure you're comparing apples to apples.

For instance, if your company had an overall employee turnover rate of 5% and a year later it's still 5%, you might assume that nothing changed.

But if you had an employee turnover rate of 5% for the entire company, then you launched an employee retention program that improved turnover for certain functions but worsened turnover for others, your employee turnover rate might stay the same despite these improvements.

In addition, if your company is hiring a lot more people in roles that have a higher turnover rate, it could create a skew.

Before you start collecting data on your retention programs, write down the following:

1. What success looks like (i.e. a 3% reduction in the employee turnover rate)
2. What failure looks like (i.e. continuation of the employee turnover rate as-is or an increase)
3. What decision each success or failure leads to (i.e. scaling the program, adjusting it, stopping it)

Writing these down ahead of time is important. Otherwise, it becomes easy to view any result as a success in hindsight or a failure in hindsight. If your turnover rate decreases, you assume the program worked.

If your turnover rate increases, you assume it would've increased more without you.

Track your retention program outcomes by group and tenure

Here's how you should track various data points:

• Overall employee turnover, regretted employee turnover: Classify regretted turnovers by pre-determined criteria and create clarity between HR and the manager. Ensure it is clear at the time of turnover whether it will be classified as a regretted turnover. Avoid re-classifying employee turnovers based on memory (which can lead to narrative accounts). Once retention percentages become part of manager scorecards, expect pressure to re-classify regretted turnovers as non-regretted turnovers. Audit a sample of cases every quarter to check.
• Employee retention by team and tenure: Define your starting population, and keep in mind that each employee belongs to a specific team even if they leave that team. This allows you to track retention rates reliably over time. Otherwise, a high-performing retention team could improve their retention rates by encouraging internal moves among flight risks. Understand data noise levels. In a team of 20 people, an employee turnover of only 3 people gives you a 15% turnover rate, but it's entirely possible the actual turnover could be anywhere between single digits to over 30%. As a rule of thumb, breakout groups with less than 30 people should use annualized turnover rates for better comparability.
• New hire, employee turnover in first year: Avoid comparing a 12-month turnover figure for a partial cohort to other cohorts. The partial cohort will most likely have an inflated 12-month turnover figure, leading to a skewed comparison.
• Employee engagement score trends: Keep the wording of items and delivery of surveys consistent. If you change specific items or the timing of surveys, your results are not comparable. After you've nailed your survey, ensure that the same workers are actually participating. If disengaged employees leave your organization, this will artificially increase the average engagement scores for your organization and make it seem like engagement levels have improved when they haven't. The same thing can happen if survey participation drops. If the unhappiest employees stop participating, your survey results will suggest your engagement levels have increased. Always interpret your engagement levels in relation to turnover data and participation rates.
• Leading indicators: Questions related to intent to stay, relationship with manager, and participation rates can often be leading indicators before an employee leaves. These leading indicators are especially useful when aggregated at the team level. A sudden drop in participation is a sign something's amiss. Keep in mind some teams or groups may not have enough people to reach the minimum response rate for your survey tool. These teams' results will be hidden from further analysis to protect anonymity. Ensure you consider this when defining your aggregate data level and avoid creating reports that allow someone to backcalculate hidden teams by comparing other teams to overall data.
• Intended, non regretted turnover: Use this as a counter metric. If these non regretted turnovers start to trend towards zero after you start including retention in managers' performance evaluation, it may be a sign managers are holding onto employees who shouldn't be.

Compare your results before and after the launch of your retention program

Compare retention outcomes from 12 months before your retention program launch, with 12 months after your retention program launch (considering the same calendar month periods). Employee turnover can be clustered around specific time periods like bonus payouts, equity vesting, and review cycles. You want to ensure your data captures these events in both the before and after comparison.

Keep your segments constant - compare the same teams, tenure bands, and hiring cohorts using pre-launch segment assignments.

Also, weight your data based on exposure over time. For instance, if a team is only three months into a retention program, only count those three months towards the team's overall data contribution. This will prevent teams from skewing your analysis.

If your retention program focused on the teams with the worst turnover rates, you have to account for regression to the mean.

Teams selected for a year-long study because they had an unusually high turnover rate may see improvement in their turnover rate just by chance, regardless of whether there's a retention program.

An example of this is outlined by Daniel Kahneman in his book, Thinking, Fast and Slow. Flight instructors thought their criticism improved performance, when in fact it was just more likely that they would have a more typical performance after an unusually bad performance.

Without a comparison group, it's difficult to separate regression to the mean from the impact of your retention program. This means that a before-and-after comparison of your worst teams is difficult to interpret.

If possible, consider comparing your participating teams to similar teams that haven't yet participated in a retention program.

If you're rolling out a program phase by phase, you can almost naturally put together comparison groups by deliberately choosing a mix of teams and randomly choosing which of the teams will actually implement the program first (instead of simply choosing the team that volunteers). This can be understood as keeping some teams in "control" for the time being.

Offer this approach to leadership if there's a pushback against "holding teams back" from a retention program.

Since volunteer teams are likely already better managed, your initial program results will likely be inflated. This shouldn't be considered a failure.

If after your program, there's an improvement in regretted turnover for participating teams and no change in the matched comparison group, you have evidence that a larger scale change may lead to a company wide improvement.

If similar improvements are seen in both participating and matched comparison groups, it may suggest your retention program is not a factor in the improvement.

This is the kind of small deliberate test recommended by Jeffrey Pfeffer and Robert I. Sutton in Hard Facts, Dangerous Half-Truths and Total Nonsense. Instead of adopting new practices blindly, or adopting them because other companies do, they argue for testing practices locally. There's a debate among practitioners on how rigorous an evaluation of a people program should be. Use this insight to understand how to gather reasonable evidence on program effectiveness.

Consider the external labor market as well.

A downturn in the labor market will result in lower turnover rates whether you did anything to impact that or not. To account for this, compare your turnover rates with US industry turnover rates from the US Job Openings and Labor Turnover Survey (JOLTS). This is helpful, since JOLTS data includes industry-specific rates instead of just national aggregation.

You can also consider using signals of external demand at your organization, including the number of times a departing employee reports being contacted by a recruiter, or the number of times counteroffers are made.

The real question is whether your gap to the market has changed, not whether there's just a difference in your rate.

Understand there'll be a lag reading engagement scores against turnover rates.

Your engagement scores can even go up a few rounds before your retention levels are impacted.

This isn't a reason to deem your program a failure.

In fact, if teams begin to drop in engagement scores, but their retention rates stay steady for a quarter or two, this is an early warning that things may start to slide soon. It's not uncommon to see a chain reaction of turnovers after one well-liked member of the team departs.

Use this an early warning system, rather than an indication that everything's fine.

Final thoughts: You don't always need to pay more, you may just need to pay attention

Without question, money retains people, but it's not the only way to retain employees.

In fact, sometimes it's a Band-Aid solution to a deeper problem.

Anyone who's ever accepted a counteroffer only to quickly regret their decision can attest to this.

Employees want to be appreciated, they want to continuously learn, and they want to know that there's room to grow within their current organization.

And when they notice they can't receive these things within their current role, they look elsewhere.

Keeping your current employees happy and job satisfaction high is a much smarter employee retention strategy.

You avoid high recruitment costs.

You retain valuable knowledge that even an excellent new hire can't replace.

And you also protect your employer brand by ensuring people who do leave the organization only have good things to say

If you're interested in learning how Sparkbay can help you retain your talent, you can click here for a demo.