Low productivity, absenteeism, demotivation and headhunting – burning issues that demand instant solution otherwise they will lead to employee turnover. In fact, 87% of HR experts consider employee retention among the highest priorities.
No wonder it is still on top of the HR challenges. When an employee leaves, it costs the company 33% of that employee’s annual salary to find a replacement. And according to Bamboo HR, 31% of employees have quit their job within the first 6 months of starting.
Employee turnover happens for a bunch of reasons like the employee is not satisfied with his/her salary or feels overwhelmed, there is little opportunity for growth and progress or maybe you just did the wrong hire.
What if you already offered the employee a competitive salary, gave him/her health insurance, flexible work hours, days off, but still, it didn’t keep the employee in the company.
Statistics show that disengagement is one of the major causes of turnover. The benefits stated above aren’t enough to make employees engaged so that he/she stays in the company longer. There is also one thing which might not get enough attention by managers. It is the employee recognition.
Before finding out how recognition increase employee engagement and learning the ways how to make it happen, let’s see why engagement is so important and why you need to recognize your employees to make them engaged.
Your engaged employees are the ones who help your company grow
Wonder why engagement can affect retention so much? The answer is simple. Engaged employees fully understand the vision of the company and the purpose of their job which helps them to work more productively. They show up to work, do their job with dedication and commitment, even are ready to stay long hours at work to achieve their daily goals.
The link between employee engagement and retention is deep-rooted.
When an employee is engaged, it will be harder for other HR Managers to headhunt that person. Let’s state this with numbers.
Employee engagement companies realize in 41% reduction in absenteeism and a 17% increase in productivity. (According to Gallup)
Now let’s dig even deeper. Engaged employees help the company perform better financially thus affecting the outcomes of the company. In fact, highly engaged companies achieve a 10% increase in customer ratings and a 20% increase in sales. (According to Gallup)
The Effect of Recognition on Employee Engagement
Employee recognition is the acknowledgement of an employee’s efforts and achievements that supports the company’s goals and values. It is the key factor affecting employee engagement, and therefore organizational performance.
Recognition helps employees see that their company appreciates and cares for them. It makes them feel that their work doesn’t go unnoticed. Thus, an appreciated employee is more motivated and productive and works harder to achieve new heights. As a result, this employee became more engaged than the one who doesn’t get recognized and appreciated.
Recognition programs are made for this exact purpose to motivate employees by appreciating their work through recognition.
While there are different ways of recognizing employees, 94% of HR professionals agreed that an effective recognition and reward program helps drive business results, and has a positive effect on employee retention. (HR Technologist)
In fact companies with recognition programs that are highly effective at improving employee engagement have 31% lower voluntary turnover.
All those statistics show that recognition may be the last ingredient in the bowl to increase employee retention rate in your company.
By recognizing your employees you’ll increase their engagement, as a result those employees voluntarily will choose to stay in the company longer.