Faithful readers of this blog are probably shocked that we would even ask a question to which the answer seems so apparently obvious. Our answer to this question may shock you even further…
Yes - employee turnover can be too low!
How can this be you ask?
Let me explain…
Most of us are all too familiar with the high cost of employee turnover. The Society for Human Resource (SHRM) estimates the average cost of turnover per employee to be a staggering 150% of an employee's salary and benefits.
However, we often fail to recognize the costs associated with employees who "stay and quit." These are individuals who show up to work each day, but never really get out of their vehicles when they pull into the parking lot. They are unengaged, have quit emotionally, and rob an organization of possibility by draining productivity, damaging customer good-will, and killing morale.
When considering the cost these individuals inflict upon an organization, turnover can certainly be too low. An example…
The Rainmaker Group is headquartered in Bismarck, North Dakota. The population of Bismarck and the surrounding community is approximately 75,000 – the second largest in the state - though not huge by any standard.
Given the size of the community and its economic and geographic isolation, we have come to conclude that Bismarck is in a precarious employment situation: turnover is too low.
How did we come to this conclusion?
While unemployment is low – typically well below the national average, even during tough economic times –opportunities for gainful professional employment are limited. Given the limited opportunity to hop from job to job, we came to suspect that many individuals were staying with their employers because they have to, not because they want to. To test our hypothesis we conducted a survey at a local event with a high percentage of professional workers.
The results, while still preliminary, were very interesting. A considerable number of respondents indicated a low or very low level of engagement in their current positions and felt that their skills and abilities were not being used to their full potential. However, almost all had no intention of seeking employment elsewhere in the coming 12 months.
The kicker?
When asked, nearly every one of these individuals felt that there were not adequate opportunities locally for gainful employment for individuals with similar skills, experiences, and educational backgrounds.
The result?
These individuals stay in their position because they have to, not because they want to… They have quit, but forgot to tell anyone.
Nobody wants to work in a job they hate, just as no organization wants workers who hate their jobs. It's bad for both parties – both financially and emotionally. Invariably it is best for the organization and its workers that these individuals find more meaningful employment elsewhere
Consider this…
When you plant a garden, you must first remove the weeds. After the weeds are removed the right plants and herbs can be selected based on a number of factors such as sun exposure, type of soil, required growing time and space, climate, etc.
Much as a gardener must go through the hard and sometimes painful work of removing weeds to ensure a hearty harvest, so must an organization go through the difficult process of assisting unhappy, unengaged, and unfit employees in finding employment elsewhere. After this arduous task has been completed it can now focus on getting the right people in the right positions in the pursuit of organizational excellence.
Is turnover too low in your organization? A few things to consider…
- If your team members wanted to leave could they or do they stay because they have to?
- Are there adequate employment opportunities in your community?
- Are your team members fit for their roles in your organization?
- Does your organization rely on traditional hiring processes, or does it take an objective and systematic approach to finding the right employee for the job?
- Is productivity and morale as high as it could be?
While organizations with low turnover are often lauded, praised and glorified, there may be more to the story than meets the eye.
Take a moment in the coming weeks and seriously consider the issues above. Could low turnover really be keeping your organization from reaching its full potential???
Now go Maximize Possibility!
Other blog posts you may be interested in:
- Does HR Really Want to Reduce Turnover?
- Flawed HR Metrics: Voluntary Turnover Rate
- The High Cost of Employee Turnover
- How Poorly Fit Employees Pose as High Performers
Chris Young helps organizations Maximize Possibility through talent management, cultural transformation, and strategic intervention. Bring Chris in today!
