In general, employers understand that employee retention is a good thing but it’s worth talking about all the benefits that long-term employees provide employers. According to the Bureau of Labor and Statistics, the median number of years that wage and salary workers had been with their current employer was 4.1 years in January 2020. An employee retention rate of 90 percent or higher is considered good but it does vary from industry to industry. The hotel, retail and food industries have the lowest rates of employee retention while government, finance, insurance, and education jobs carry the highest rates. With Hawaii’s economy heavily dependent on service and tourism jobs, employers should still do what they can to reduce turnover to reap the benefits of longer-term employees.
Top 5 Benefits of Long-Term Employees
1. Cost savings
With the cost of doing business, many employers cannot really afford to have high employee turnover. Every time a business loses an employee, they spend time and money to advertise for a replacement, conduct interviews and train the new worker. Not to mention, lost productivity while the new employee gets up to speed. Businesses that hold onto employees save money, period.
2. Better customer service and customer relationships
Long-term, loyal employees tend to give their all when it comes to serving your customers. It probably goes without saying that customers who are treated well are more likely to be return customers. In addition to this, customers like to work with people they know. When employees stay with a company for years, they get to know your customers and clients, which increases customer loyalty.
3. Invested in the company’s success
Employees who stay with a business for a long period of time are more likely to feel personally invested in the company’s success. This means taking ownership of their work and doing their best without being prompted. Employees who believe in the company’s mission and values are more likely to stick around and do work they feel proud of.
4. Increased productivity
Let’s face it; newly trained employees aren’t going to be as efficient at their jobs as employees who have known the job for a long time. Long-term employees are more productive because they know your operating systems, your customers and your processes.
5. Higher employee morale
Businesses with high retention rates tend to benefit from higher employee morale. If you can build a culture of long-term employees, it is likely to result in new employees joining and wanting to stay as well.
With all the benefits of long-term employees, it makes sense for businesses to stay connected to their employees’ needs and wants such as flexible work hours and great employee benefits.
Want to do the best job possible meeting your employee needs? When you partner with Makai HR you can get on with the business you are trying to grow while we take care of your employee needs from payroll to taxes, health insurance/benefits and worker’s compensation. You also gain peace of mind that you are compliant with all of Hawaii’s employer laws (if you’ve ever looked you know that the list is very long). When choosing a PEO to partner with, there are many things to consider including cost, services and technology solutions.
With the cost of doing business in Hawaii at record highs, we know how important it is to keep labor costs in line with revenue. Our plans are priced competitively and include value-added services like time-in/time-out systems. Our three tiers of PEO service plans are tailored to the size of your business and specific needs. We offer a 100% paperless solution which means that your employees can manage their needs through a computer, tablet or phone. We can truly improve your employees work benefits while freeing you up to run your business.
What are you waiting for? Companies that partner with a PEO benefit from 7-9% faster growth, 10-14% lower employee turnover; and they are 50% less likely to go out of business. Contact us today to get started!