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Dealing with employee turnover costs an organization in both time and money. Retail grocery stores face average turnover costs of up to $190,000 per year. From a job perspective (hourly employee, department head, store manager), turnover costs can range from 16-20.4 percent of the employee’s annual salary. Managers within the grocery industry report that dealing with employee turnover of this magnitude produces serious, demoralizing effects and adversely affects the store’s overall performance productivity. Separating the myths from the realities in dealing with turnover becomes the key to implementing effective retention strategies.
Unfortunately, there are several misconceptions regarding the causes of turnover. This misleading information may cause managers to focus on ineffective retention approaches. The following are the most common myths regarding why employees leave a company:
- Employees leave due to salary issues
- General dissatisfaction causes employees to leave
- Managers cannot prevent turnover
- Retention strategies are ineffective
The reality is that burnout is the underlying cause of turnover in the retail grocery industry. Burnout results when a mismatch occurs between the work environment and the employee’s perception of his or job.
Research results show that if an employee has a feeling of control over the work environment, he or she then develops a sense of:
- Community – positive relationships with co-workers and manager
- Fairness – feelings of trust and respect between employees and managers
- Reward – money and non-monetary benefits
If an employee perceives a loss of control, this leads to perceptions of workload exhaustion and feelings of cynicism. Ultimately, this results in the employee deciding to leave the company.
Basing retention strategies on evidence-based information helps retail grocery managers address the root problems. The following key recommendations result in positive retention efforts:
- Utilize employee engagement surveys to uncover potential problems and monitor progress in retention efforts
- Help employees to efficiently manage workload by setting clear expectations and providing time management suggestions
- Encourage autonomy
- Involve employees in decision-making and listen to their recommendations
- Create learning opportunities and flexibility for cross-training
- Implement recognition initiatives
- Promote trust, fairness and compassion
Pamela Ann Gordon, Ph.D. works in faculty development at University of Phoenix. Steven Harrison, DBA is a co-manager of a retail grocery chain in South Carolina.