Reduce high employee turnover by addressing these 6 causes


By December 2021, the employee turnover rate in India’s IT sector was at an all-time high. While TCS reduced its strength by 15.30% through attrition, Infosys and Wipro saw an attrition rate of 25.50% and 22.70% (AIM).  

What is labour turnover?

Labour turnover definition – A high labour turnover means many employees leave your company, thus increasing the workload on other employees. It hampers the productivity of your existing workforce. When they are not satisfied with their work, more people leave, thus further increasing the employee turnover rate.  

This blog will discuss some of the top causes of a high labour turnover rate and their solution.

1. Poor compensation

Poor compensation is one of the biggest causes of a high labour turnover. If your employees realise they can get a better salary elsewhere, they will most likely consider switching jobs. 

Therefore, you must first address labour turnover due to poor compensation. Good compensation motivates employees, keeps them hooked to work, and achieves company goals. Offer competitive compensation and modern-day benefits like office perks, flexible timing and remote work opportunities.

2. Toxic work culture

Toxic work culture

Employees’ happiness depends on the company’s work culture. A toxic work environment will likely make employees unhappy and unsatisfied. It will lead to a high labour turnover. Some of the prominent indicators of a toxic work culture include – 

  • Lack of respect
  • Abusive behaviour
  • Absence of ethics
  • Fear of failure

Create a world-class company culture where employees feel respected and valued. Embrace imperfections with enough opportunity to learn and improve. It will help you do away with a toxic work environment.

3. Poor work-life balance

Poor work-life balance

Companies worldwide are adopting a flexible culture to improve their labour turnover rate. The employees can decide which time of the day suits them for work. Hence, people who get to work when they are most productive contribute the most to their company’s business. You will struggle to attract top contenders and retain them if you don’t offer enough paid time-off and flexible working opportunity. 

Create an attractive leave policy and provide remote work facilities if it suits your business. Alternatively, consider adopting a hybrid model where employees are required to come to the office on some days and can work from home on other days.

4. Lack of growth and development opportunities

Top employees with a growth mindset are always looking for opportunities where they can learn more and grow more. Therefore, the absence of enough learning and career advancement can cause labour turnover. 

Companies with a good business outlook are already taking the initiative to provide their employees with growth and development opportunities. Facilitate learning and development opportunities – share company’s purpose, offer e-learning facility and on-the-job training for promotion to a senior position.

5. Lack of employee recognition program

Employee recognition and retention are related. According to a survey by Achievers, 55% of 1700 participants planned to change jobs, with the lack of employee recognition as the main reason.  

People are more likely to continue working for you if you acknowledge them with positive feedback and recognition with other monetary and non-monetary rewards.

6. Job insecurity

Generally, in companies that struggle with their business development and profit growth, employees have job insecurity issues. They repetitively think about the future of their job. To get away from such a stressful situation, they look for jobs in companies which are profitable and have a better business outlook.

You can best address your employees’ job insecurity issues by being empathetic to them. Create a good company culture, encourage team bonding and organise fun activities to engage them. It will help you create a work culture where employees will work towards achieving business objectives collectively instead of thinking about the future of their jobs.

A high labour turnover can massively impact your business. If you can effectively address the above causes, you will likely create a company culture that your employees appreciate. They will stay with you for long and help strengthen your team building efforts.

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