During the upheaval of the COVID pandemic, millions of people lost their jobs, and companies stopped hiring. Economic uncertainty led many to stay in the jobs they had. Now, as the light at the end of the pandemic tunnel comes into view, many are ready for a change. As a result, human resources experts are predicting a “turnover tsunami” once the economy starts to recover.
And that could create new challenges for companies, given that the cost of replacing an individual employee can range from one-half to two times the employee’s annual salary, according to data from Gallup. In fact, Gallup estimates that voluntary turnover costs U.S. businesses nearly $1 trillion each year.
Losing employees can mean broken relationships with customers, and lower productivity and morale among those who stay. It can also lead to even more turnover — not to mention the institutional knowledge that walks out the door when an employee leaves.
So what can businesses do to not only get ahead of this impending shift, but to also encourage employees to stay regardless of market forces? One answer might surprise you: Invest in diversity, equity, and inclusion (DEI) programs.
How DEI programs help
A strong company culture is more than a series of “here’s what we don’t do” rules. It’s a collection of mutually held beliefs about what the organization aspires to be. Effective DEI programs create a culture of mutual respect that boosts employee retention.
They help identify biases and provide ways to overcome them, turning uncomfortable situations into learning experiences for everyone involved. They also allow people to feel comfortable being themselves so that they can contribute at their best.
If people feel comfortable being themselves at work, and free to express different parts of their identities, it helps employers know what motivates them and what can be done to keep them on board. Knowing employees makes recognition and career planning more meaningful—two important keys to retention.