Drawbacks of Employee Retention and How You Can Improve It

In my previous article, I've talked about the benefits of employee retention and how important it is for businesses.

In this post, instead of talking about the benefits of employee retention, we will talk about the drawbacks of employee retention.

While high rates of employee retention offer organizations many benefits, there are also some potential downsides that many business leaders need to think about these downsides and find the way to improve the situation.

The drawbacks to high employee retention rate are disengaged employees who remain in their roles, hurt productivity, create toxic work environments, and drive good employees away.

High retention can also lead to difficulty implementing change, less innovation, and a lack of diversity and inclusion. We will break down drawbacks of employee retention to different sections and talk in more detail.

1. Stagnation

Having high employee retention rate and not bringing new talent the workplace might lead to a lack of fresh ideas and perspectives. This can result in stagnation and hinder innovation.

Stagnation is when employees do not experience development in terms of competence or career. This can manifest as a lack of promotions, monotony of duties, and a feeling that the work does not bring satisfaction or new challenges. In personal and professional development, stagnation is when we stop learning, developing, and moving forward.

2. Employee Disengagement

One of the main downsides to higher retention rate is the role that disengaged employees can play in a company. 

Disengaged employees are not passionate about what they do and show a lack of commitment to their jobs. They often exhibit toxic behaviors, underperform, and lack a strong belief in or enthusiasm for the organization’s mission, vision, or values.

These employees are not interested in problem-solving, process improvement, collaboration, or innovation. They may be averse to change and express frustration when they are asked to do certain tasks or learn new processes. 

3. Resistance to Change

Long-term employees might resist new technologies or changes in company processes–which can improve performance and efficiency , making it challenging to implement necessary changes.

One of the biggest reasons why these long-term employees resist change is because it makes them feel like they are losing control over their work, creating a heightened sense of uncertainty.

4. Potential for Complacency

Workplace complacency is a psychological state when employees tune out, cease to think, and merely follow a routine. In other words, employees enter “autopilot mode” and complete tasks automatically instead of mindfully.

Complacency can lead to low performance, lower client satisfaction, and workplace accidents. Long-term employees might become complacent, thinking their job is secure, leading to a drop in performance and productivity.

5. Less good performing employees

Not everyone working at your company is ready to grow along with the company. Therefore, these employees become liable for the company.

The low performing employees cannot contribute much work and idea to help the company grow and sometimes can adversely affect the company.

6. Employee groupism 

Employee groupism is when employees favor their own group over the company as a whole.it can create divisions and reduce teamwork, impact on overall productivity and harmony of the work environment. It can lead to feelings of exclusion among employees who are not part of a group, affecting their motivation and job satisfaction.

Retention can influence employees to overestimate their worth and shift power to the wrong hands. As a result, the work quality and workflow impact a lot.

It is important to clarify why an employee was retained in the first place. It will give them a sense of self-worth and end groupism.

How can you improve your employee retention rate without having all of the drawbacks mentioned above ?

As managers and leaders in human resource department, it is crucial to weigh the pros and cons when implement new employee retention strategies. Find the right balance between employee turnover and employee retention rate, retain the right employees that align with your company short and long term goals, and bringing in fresh ideas for innovation. 

Read my effective employee retention strategies here

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