Imagine how it would feel to lose your best employees, because despite them giving all to your business, they didn’t feel valued. In the meantime, another employer – even worse, a competitor - has snapped them up, and you’re left wondering if you could have done more.
In today’s corporate world, employee retention has become an increasingly critical business concern. And one of the key issues that’s been on our radar at Apollo Solutions is the impact of overdue promotions on employee turnover, and talent attraction.
Your employees innately want to grow. They need a clear progression path and reassurance they can climb the corporate ladder with your organisation. And even before an employee who feels unappreciated moves on, you risk affecting staff morale and causing frustration and restlessness by moving too slowly with promotions.
You see, business success is not just about keeping up with the latest market trends, but also with the aspirations of your workforce. Here, we’ll delve into this topic, exploring its implications and providing actionable insights for both employers and employees.
Understanding the impact of delayed promotions
The relationship between promotions and employee retention can be complex. According to a study, a staggering one-third of employees are leaving their jobs within a month after receiving a promotion. This counterintuitive finding suggests a paradox - isn't promotion supposed to be a reward that boosts employee morale and loyalty?
The answer lies in the timing of the promotion. By the time many employees receive their long-awaited promotion, they’ve unfortunately already experienced a significant amount of frustration and disappointment. Couple that with the fact that internal promotions often come with less substantial pay raises compared to changing jobs, and the allure of the new title quickly fades away.
The cost of employee turnover
Employee turnover comes with a high cost. Did you know that replacing an employee can cost between one-half to two times their salary? Not to mention the fact that high turnover rates can also negatively affect the morale of remaining employees and disrupt workplace productivity and cohesion.
On the other hand, a report by Gallup in partnership with Workhuman, revealed that creating a culture of recognition could actually save companies with 10,000 employees up to $16.1 million in turnover costs each year.
Strategies for employers to improve retention
Recognising the importance of timely promotions is the first step towards improving your employee retention. Here are a few strategies you may wish to consider implementing as an employer:
(1) Transparent Promotion Procedures
Having clear and transparent promotion procedures can help manage employee expectations and prevent feelings of frustration and disillusionment.
(2) Regular Performance Reviews
“Employees who feel well-supported by their line manager are 3.4 times more likely to feel engaged at work” – that’s according to the findings of a study of 50,000 employees by Inpulse. Regular performance reviews can help identify high-performing employees who deserve promotions and provide an opportunity to discuss career progression.
(3) Competitive Compensation
According to a survey by Payscale, employees who receive a promotion but no salary increase are 50% more likely to plan on leaving their company in the next six months. This highlights the importance of adequate compensation for promotions.
(4) Training and Support
Providing proper training and support to newly promoted employees can ease the transition and make them feel valued and supported.
Advice for candidates: Taking charge of your career
For those who feel stuck in their current role, here’s our advice: it's essential to take proactive steps towards managing your career progression. Make sure you’re engaging in open communication with your manager about your career goals. And if you're simply not seeing the growth you desire, it might be time to consider looking for opportunities elsewhere.
Additionally, committing to continuous learning and skill development can increase your chances of securing a well-deserved promotion.
To conclude, overdue promotions can indeed drive exits in a company. And it’s crucial for employers to recognise this and take appropriate action. But on the other hand, it’s also important for employees to take proactive steps to manage their own career progression. By creating a culture of growth, transparency, and mutual respect, companies can not only improve employee retention, but also create a more engaged and productive workforce and addtionally, attract the best talent in the market.
Would further recruitment insights and trends like this help you? Whether you’re an employer or a jobseeker, Apollo Solutions is deeply immersed in the ever-changing world of hiring. We’re here to help you create a winning recruitment strategy or advise on your next role. Check out our insights page, get in touch with us today to discuss how we can work together, browse our latest jobs or upload your CV.
