Sometimes a manager first learns why an employee is unhappy when that employee gives notice. By then, the employee may already have accepted another job. Employee retention strategies can help managers find out what’s frustrating people while there’s still time to do something about it.
What Employee Retention Strategies Actually Are
Employee retention strategies are the deliberate practices an organization uses to keep the people it wants to keep and to reduce the voluntary turnover it can’t afford. It helps to separate a few related ideas. Job satisfaction is how content someone is with their job. Engagement, which I cover in a separate piece on employee engagement strategies, is how invested someone feels in the work itself. Retention is narrower still, and measures whether employees stay over a given period. The three are connected, but they aren’t the same, and a company can have satisfied or even engaged people who still leave for a better opportunity.
Before you can improve retention, you need to measure it honestly. To calculate a retention rate, divide the number of employees who were on staff at the start of a period and stayed through the end by the number employed at the start, then multiply by 100. Employees hired during that period aren’t counted in the top number. A separate and often more useful measure is regrettable turnover, which looks only at the departures a company most wanted to prevent.
Why Employees Leave
People leave for several reasons at once, and managers who reduce it to a single cause often fix the wrong thing. Pay that has fallen behind the market pushes people out. A manager who micromanages, takes credit, or avoids hard conversations drives good people away, which is why learning to handle a difficult management relationship matters as much to retention as any formal program. People also leave when they stop growing, when the work stops meaning much to them, or when the gap between what leadership says and what employees experience gets too wide to ignore. That gap does real, lasting damage, and I’ve written separately about the leadership mistakes that erode a culture.
Changes in how someone shows up at work are a reason to check in, not to jump to conclusions. If a person who used to speak up goes quiet, or starts turning down assignments they would once have taken on, that’s worth a conversation. A declined stretch assignment can have several explanations, from workload to something happening outside of work, and the only way to know is to ask.
Employee Retention Strategies for Managers
The table below shows when each strategy can help and what to consider.
| Strategy | When it can help | What to consider |
| Competitive pay | When pay has fallen behind comparable roles and people raise compensation | Pay is rarely the only reason people leave; close clear gaps, then look at the other reasons |
| Career growth and development | When people can’t see a path forward or have stopped learning | Works best when tied to specific skills, assignments, and check-in dates |
| Onboarding | When newer employees leave early or take a long time to get up to speed | Focus on the first month: clarify the role and who can answer questions |
| Regular one-on-ones | When managers and their teams rarely talk outside formal reviews | Useful only if managers act on what they hear |
| Flexibility | When the work allows it and people value control over when or where they work | Fit it to the role; inconsistent rules can create more friction than they remove |
| Recognition | When good work is going unacknowledged | Works best when it’s specific and timely; more on this for remote teams |
Keep pay in line with comparable roles: If pay has fallen behind comparable roles, review what employees are paid and where adjustments are needed. Pay is rarely the only reason people leave, so it’s worth closing clear gaps and then looking closely at the reasons that follow.
Make growth part of the regular conversation: Discuss where people want to go on a regular basis rather than saving it for an annual review. A simple approach works well: agree on a skill the person wants to build, find an assignment where they can practice it, and set a date to check on progress together.
Get onboarding right in the first month: Early on, make sure new hires know what success looks like in the role, who they can go to with questions, and what’s expected of them in their first few weeks. Check in early to find out what’s still unclear, rather than assuming that no questions means everything is fine.
Help managers get better at one-on-ones: The regular conversation between a person and their manager shapes much of their experience at work, and a good one-on-one is more than a status update. Managers can ask what’s making the work harder, give specific feedback, and follow up on what they agreed to do.
Helping the people who manage your teams lead better is one of the most practical ways to improve retention, and it’s a focus of the work Adam does with leaders.
Use Stay Interviews to Catch Problems Early
A stay interview is a straightforward way to ask people why they stay and what might make them leave, while there’s still time to act on what you hear. Unlike an exit interview, which can only explain a departure after it happens, a stay interview puts those questions on the table earlier.
Running one well takes just a few things:
- Keep it separate from a performance review: A stay interview isn’t an evaluation, and people stay guarded when they suspect they’re being judged. Make clear the conversation is about them and what they need.
- Ask what would make them consider leaving: The question sounds blunt, but it surfaces the frustrations people usually keep to themselves until they’ve already accepted another offer.
- Ask what keeps them here: The answers tell you what to protect, and they’re often more specific and more fixable than you would expect.
- Ask where they want to grow: This is where retention and development meet, and where you learn whether the path someone wants actually exists at your company.
- Follow up on what the person told you: Agree on what you’ll look into and when you’ll follow up. If you can’t make the change, explain why.
Not All Turnover Is Worth Preventing
Not every departure is one you should try to prevent. Some turnover is healthy, like the person who has outgrown a role and moves on with your support, or a hire that was never the right fit. Rather than trying to prevent every exit equally, it helps to look at who is leaving and decide which departures you most want to prevent. Those regrettable departures, the losses of people and skills you can’t easily replace, are the ones to build your retention efforts around. There is a lot to learn from why people leave, as long as you’re honest about which exits actually cost you.
What keeps good people is usually growth and strong relationships more than perks. Here is how one person who worked with me put it:
“Adam brings a true authenticity and transparency to his story and advice on how to pursue career goals, build key relationships, and remain agile in the business and life planning process. I left a 90 minute session with Adam inspired, while also clear on tactical steps I could take tomorrow to improve my career and business. My biggest takeaway was the power of relationships and people in your career. I’d encourage everyone in any industry to listen to Adam’s message and use his story to redirect or re-inspire your team.”
— Ryan Campbell, Snowflake
Hear how top CEOs and founders built teams people wanted to stay on, in their own words.
Listen to Thirty Minute Mentors
Frequently Asked Questions
What are the most effective employee retention strategies?
Start by finding out why people are actually leaving, since the right strategy depends on the reason. From there, the approaches that tend to help are practical and ongoing: keeping pay competitive with comparable roles, giving people a clear way to grow, onboarding new hires well, holding regular one-on-ones, and recognizing good work specifically and promptly. These approaches work only with consistent follow-through from managers.
Why do employees leave their jobs?
People usually leave for a mix of reasons, including pay that has fallen behind comparable roles, a manager they don’t trust or respect, a lack of growth, work that no longer feels meaningful, or a wide gap between what leadership promises and what employees experience.
What’s the difference between employee retention and employee engagement?
Engagement is how invested someone feels in their work, while retention measures whether they stay over a period of time. The two are related, since engaged employees are generally more likely to stay, but they aren’t the same. Someone can be disengaged and stay for the paycheck, or be engaged and still leave for a better opportunity.
How much does employee turnover cost a company?
Turnover is expensive once you add up recruiting, hiring, and the time it takes a replacement to get up to speed. The cost tends to run higher for senior, specialized, or hard-to-fill roles, where lost knowledge and relationships add up in ways that don’t show cleanly on a budget.
What is a good employee retention rate, and how is it calculated?
To calculate a retention rate, divide the number of employees who were on staff at the start of a period and stayed through the end by the number employed at the start, then multiply by 100. Employees hired during the period aren’t counted in the top number. There isn’t a single “good” rate that fits every organization, since it varies widely by industry and role, so it’s more useful to track your own rate over time and to watch regrettable turnover, the departures you most wanted to prevent.
How can a small business retain employees without a big budget?
Many of the most effective retention practices cost little. Regular one-on-ones, specific and timely recognition, honest communication, and real conversations about growth depend on a manager’s time and attention more than on budget. Smaller teams have an advantage here, since a single attentive manager can shape the experience of the whole group.
The Takeaway
If several employees tell you they can’t see a path to their next role, find out where they’re getting stuck. They may need clearer promotion criteria, opportunities to build experience, or better visibility into roles on other teams. Each calls for a different response.
