Learn how to measure turnover and retention, and understand why people leave organisations
In a Nutshell: Issue 110
This study shows how employers can make more informed decisions on how to customise retention strategies by grouping employees into four types of profile. It even makes the case for lowering exit barriers if your workforce is made up of a large proportion of ‘reluctant stayers’.
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The effects of latent withdrawal profiles on employee turnover, destinations and job performance. Xiangmin Liu and Sumita Raghuram. Human Resource Management Journal. April 2021.
Generic employee retention programmes that focus on common turnover predictors are inadequate and costly because different employees have different reasons for leaving. Not all employees who intend to leave do leave, and not much is known about the performance of those who don’t act on their intentions.
- Enthusiastic leavers are people who leave because they want to.
- Reluctant leavers are people who leave because they can’t stay. These are individuals who are satisfied with their current jobs but feel the pressure to leave. For example, to pursue graduate education, become full-time caregivers, anticipate termination for poor performance or anticipate layoffs.
- Reluctant stayers are people who stay because they can’t leave. These are individuals who want to change jobs, but family responsibilities or lack of alternative jobs prevent them from leaving.
- Enthusiastic stayers are people who stay because they want to.
- Turnover: As expected, enthusiastic leavers have the highest likelihood of leaving for another job. Enthusiastic stayers have the lowest likelihood of leaving.
- Post-exit destination of leavers: Among those who leave, enthusiastic leavers are more likely than people in the other three profiles to leave paid work altogether and go onto further their education, become full-time carers or relocate.
- Job performance of stayers: Among those who stay, enthusiastic leavers display higher job performance than reluctant stayers.
Potential data sources include employee surveys, exit surveys conducted as part of exit interviews, job performance data and records of when employees left. Organisations that have fully-fledged people analytics capabilities can do this in house. Those without people analytics capabilities may need to engage external statistical consulting services. Although this is an additional cost, the benefits may outweigh the cost of ineffective retention strategies.
- Reluctant stayers who value growth would benefit from general or job-specific training programs, mentoring and challenging assignments that enable employees to learn on the job. These initiatives would benefit enthusiastic stayers as well.
- To retain reluctant leavers who are sensitive to external opportunities, retention strategies must include competitive rewards and development opportunities.
- Even for enthusiastic leavers, opportunities for future employment or building alumni ties would enable organisations to reap benefits from their networks.
- As for reluctant stayers with low job performance, organisations may want to consider lowering exit barriers and reducing retention efforts for this group. One example of lowering exit barriers that the researchers gave was a ‘pay to quit’ programme to incentivise disgruntled employees to leave. Another example was to ensure that stock options that are offered are fully vested (meaning employees keep them even if they leave) so that reluctant stayers don’t feel obliged to stay. Organisations might also want to consider early or phased retirement, career counselling or transferring reluctant stayers to other positions that might fit better.
Hayfa Mohdzaini, Senior Research Adviser
Hayfa joined in 2020 as the CIPD's Senior Research Adviser in Data, Technology and AI. She started her career in the private sector working in IT and then HR, and has been writing for the HR community since 2012. Previously she worked for another membership organisation (UCEA) where she expanded the range of pay and workforce benchmarking data available to the higher education HR community. Hayfa has degrees in computer science and human resources from University of York and University of Warwick respectively.
She is interested in how the people profession can contribute to good work through technology.