Is this the biggest lie in HR?
It’s time to stop making excuses about your turnover problem. Research shows that average employee tenure is rising rather than falling.
Let’s blow up the rising turnover myth
There’s barely a week goes by where I don’t read something about rising turnover rates.
You know the story. Turnover is rising. Retention is falling. It’s all the fault of Gen Y. They just don’t value career development. And they have no loyalty.
You could be forgiven for thinking that we’re facing a turnover epidemic.
What really worries me is when I start to hear the ‘turnover epidemic’ used as an excuse. This conversation: “Yes our turnover is much higher than we’d like, but that’s just the state of the market”.
I think we’re hearing this story so much in the business press that we believe it as fact. So is rising turnover and declining retention supported by the data?
Declining tenure is not supported by data
Employment data just doesn’t support a ‘turnover epidemic’. Despite all the noise, average retention is actually rising, not falling.
The best data here comes from the Employee Benefits Research Institute (EBRI). They produce a major report on employee tenure trends every two years. You can check it out here.
But I know you’re too busy to read a deep statistical analysis on the state of workforce tenure. So here’s the quick conclusion: job retention has stayed basically unchanged for the past 30 years. Far from declining, average tenure is actually up.
Some powerful facts (if you’re a HR geek like me!):
- Average workforce tenure has been rising consecutively in every survey since 2002 (from 4.7 years up to 5.4 years).
- Average length that someone stays in their job has actually risen since 1983 (up nearly half a year)
Workforce myths are very sticky
What’s amazing here is just how sticky workforce myths can be. As the EBRI report makes clear, there’s a long list of workforce myths that get taken as fact.
Believe it or not, one of the biggest workforce myths is lifetime employment. There’s this common conception that previous generation were typically employed by one company for life. But just like this ‘turnover epidemic’, lifetime employment just isn’t supported by fact.
Previous generations of employees may have had the option to stay at an employer for life. But that doesn’t mean they actually did. And whilst perceived job security may have declined, this hasn’t changed how often people move jobs.
As far back as records go, employees have been staying in their jobs for an average of about five years. Despite all workforce myths and rumours to the contrary!
Your turnover problem is in your control
Yes, turnover is a huge business cost. There’s plenty of big Australian business that have turnover costs running to hundreds of millions of dollars. All because they’re facing tenure that’s nowhere near this 5-year market benchmark.
But blaming the problem on the market or generation of employees isn’t helpful. Fundamentally, your turnover problem is always in your control.
Employees have (and will always) leave organizations for a reason. And if you’ve got a major turnover problem, that reason is almost always tied to bad performance management. Nothing drives employees to leave your business faster than managers who don’t provide good regular feedback and development opportunities.
So if you’ve got a turnover problem, avoid the typical excuses. Start with your performance management and fix the basics. My experience has always been that you’ll see a dramatic and quick improvement.
What’s your take on the state of employee retention? I’d love to hear what you’re seeing in the market. Jump into the comments below and let’s start the discussion.
Image credit: NASA (Public domain)