In our recent State of Skills report, 53% of companies listed employee retention as one of their top three HR priorities in 2024. It’s easy to see why.
Maintaining your workforce allows you to develop skills over time rather than having to hire for them. This is especially important given that Australia and the UK are struggling with prolonged skills shortages.
According to Manpower, 80% of UK businesses report challenges in finding professionals with specialist skills. The situation in Australia is equally concerning, with the government reporting that 36% of occupations are currently in national shortage.
However, employee retention is also more challenging than ever, as employees face challenges like siloing, burnout and an unending battle to find a comfortable work-life balance. While training offers many benefits within a modern workplace, can it also increase employee retention?
This article looks at 10 ways training impacts employee retention, examples of effective programs, and best practices for implementing employee training and measuring retention results.
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Two main factors consistently emerge when examining employee turnover: Employees resigning because they’re unhappy, and companies firing employees because of poor performance.
Employee training has the potential to address both of these issues in different ways.
1. Makes Employees Feel Valued
In a recent survey from Workhuman, 68% of UK workers said that they would consider leaving a company because they feel undervalued and underappreciated.
By investing in training initiatives, companies demonstrate a commitment to their employees’ growth and development. This shows that they care about their employees’ futures and overall careers and builds a more engaged and loyal workforce.
Well-trained employees also feel more confident and secure in their roles, leading to higher job satisfaction. This increased fulfilment makes them less likely to seek opportunities elsewhere, resulting in improved retention.
2. Challenges and Motivates Employees
Doing the same work daily can make employees feel stagnant and unprogressive in their careers. And yet, according to Lorman, 74% of employees feel they aren’t reaching their full potential at work due to a lack of training opportunities.
Providing employees with challenging scenarios and investing in continuous professional development can help them grow within their roles. This approach motivates team members to keep learning new skills and highlights future career opportunities they can aspire to, increasing employee engagement and commitment to your company.
3. Reduces Stress and Burnout
A recent Deloitte study reports that 77% of American professionals have experienced burnout in their current jobs, and 42% have left a job because of it. Contributing factors include lack of support, excessive workload and unclear job expectations.
Training is crucial in mitigating these issues by helping employees develop the necessary skills to work more effectively. This can enhance their understanding of role expectations and boost their confidence, reducing stress.
When teams are consistently trained, workloads can be evenly distributed, preventing any individual from bearing too much responsibility. Soft skill training courses for time and stress management can also help them balance workloads more effectively, promoting a healthy work-life balance.
4. Ensures Your Teams Have the Skills You Need
Skill stagnation is an increasing concern for businesses as technologies advance. Employees need to upskill and reskill themselves to stay productive and efficient. In fact, 69.2% of businesses in the State of Skills report see upskilling as more important in 2024 compared to previous years.
Training can help underperforming employees overcome their skill stagnation. The right platform can help you identify skill gaps in the workplace and deliver personalised training that addresses specific business needs. Continuous assessment can also help employees retain and apply knowledge over time, boosting overall performance and improving retention from a company perspective.
5. Aligns Employee Goals with Company Objectives
While general skill development is valuable, businesses need to cultivate specific skills to achieve organisational goals. Training is a powerful tool for helping employees grow in areas that benefit your operations.
In the State of Skills report, 85% of companies link success to workforce capability, and 69.2% say unmet skill goals hinder business objectives. This highlights the importance of aligning skill development with role-specific requirements.
Creating a skills ontology that outlines the requirements for different roles is crucial in developing an effective employee training plan. Tracking progress with a skills matrix can ensure your teams develop specific skills needed to meet business goals.
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6. Promotes Career Advancement
Addressing skill stagnation can help prevent the need to dismiss underperforming employees. However, career stagnation is another critical issue. When employees feel their roles offer no opportunities for progression, they may seek career growth elsewhere. In fact, Forbes research indicates that 56% of employees value growth opportunities more than salary.
Providing employee training opportunities and clear paths for career advancement within your company can improve job satisfaction and reduce the sense of stagnation. It gives employees a goal to work towards, and opportunities for professional development.
7. Creates a Positive Work Culture
Culture plays a crucial role in employee retention. Research from Robert Walkers indicates that 73% of professionals have left a job due to a poor cultural fit. Conversely, Lorman reports that companies with strong learning cultures see retention rates increase by 30-50%.
Building a company culture that focuses on employee well-being, collaboration, and professional development opportunities sees businesses improving overall job satisfaction. Employees are less likely to seek other opportunities and work more confidently and productively in a supportive environment.
8. Fosters Innovation
Innovative thinking is critical for businesses to enhance existing processes and adapt to changing markets. Deloitte’s 2021 Innovation Study found that 40% of innovation programs focus on optimising business operations, which reduces costs and enhances overall financial performance.
Employee training is vital in equipping businesses with the skills needed to innovate. Skilled employees with a deep understanding of processes are better positioned to develop innovative solutions that enhance efficiency. Continuous training also keeps employees up-to-date on market changes, best practices, and technological advancements, further boosting productivity.
Developing soft skills like critical thinking can help employees become self-reliant problem solvers who can identify and address challenges proactively. This drives innovation and efficiency and helps future-proof your operations by ensuring employees are versatile and adaptable to changing scenarios.
9. Encourages Team Collaboration
Stress is a major contributor to burnout, which in turn significantly affects employee retention. To mitigate this, businesses must strive to create low-stress work environments. However, Harvard Business Review reports that 92% of workplace stress is linked to team dynamics. This highlights the importance of fostering positive interactions among employees.
Training initiatives can play a crucial role in bringing teams together. Collaborative and social learning opportunities encourage teams to train collectively rather than individually. Employee training methods like simulations, role-playing, coaching and mentoring help to build communication skills and foster collaboration. Training your teams in different conflict management styles can also help your employees navigate difficult scenarios and differing opinions more effectively, further reducing stress.
10. Supports Company Growth and Development
Focusing on employee training helps retain existing staff and attracts new talent, fueling business growth. Lorman reports that 70% of employees would be willing to leave their current jobs to work for a company known for investing in professional development opportunities.
Building a reputation as a company that prioritises employee well-being boosts job satisfaction, leading to improved productivity and efficiency. This positive environment attracts more employees and ensures your company grows and develops as your talent does, exceeding organisational goals and enhancing your operations.
Examples of Training Programs That Boost Retention
Employee training programs can enhance performance, customer service, and a company’s overall reputation. While all training has value, the following programs are particularly effective at boosting employee retention and reducing turnover.
- Onboarding. Training new employees is a prime opportunity to set the foundation for their growth and development. Onboarding training helps new hires understand your company culture and their roles and responsibilities. It also allows you to assess their skill sets and identify areas where additional training may be needed. If you want to ensure you’re bringing new hires into your company the right way, our onboarding checklist can help.
- Soft Skills Training. Soft skills are just as important as role-specific training. Training your teams in communication, critical thinking, adaptability, and time management can improve teamwork and confidence, and ultimately result in better job satisfaction. These free soft-skill courses are a good place to start.
- Compliance Training. Providing compliance training alongside health and safety instruction helps employees understand their roles in protecting your company against risk. It fosters a safer work environment, allowing employees to work more confidently. This can boost job satisfaction, trust, and overall compliance. These compliance training courses can help you build a solid foundation for further learning.
- Sales Training. Effective sales training equips your teams with the skills and strategies they need to succeed in their roles. It also impacts your Sales team’s ability to meet targets and earn commissions, providing a strong incentive for them to stay with your business.
- Product Training. The more your employees understand your offerings, the better equipped and more confident they’ll be in their roles. This is especially crucial in customer service positions, where a deep understanding of products enables employees to address customer needs and concerns effectively. Microlearning, which delivers training in short, focused lessons, is an excellent approach for enhancing knowledge retention in product training.
- Management Training. Management training can take two forms — training existing managers to work with teams effectively and upskilling employees to help them progress into management positions. In both cases, training programs can help employees better engage, motivate and support their teams, while also providing a clear path for career advancement.
Best Practices for Training Programs That Boost Employee Retention
- Put a training strategy in place. Develop a structured plan that aligns training with your company’s goals and employee development needs.
- Set clear goals. Establish specific, measurable objectives for your training programs to ensure they deliver the desired outcomes.
- Use technology. Leveraging online training and assessment tools like Cloud Assess can enhance the accessibility, flexibility and effectiveness of your training program.
- Track progress. Regularly monitor and assess employee progress to ensure your training is effective and consistently improving.
- Encourage feedback. Actively collect training feedback from employees to keep your workplace training relevant and engaging.
How to Measure ROI of Training on Employee Retention
Measuring the impact that training has on employee retention is critical. It can help you understand the direct and indirect benefits of your training initiatives.
- Calculate the cost of training. Include expenses relating to materials, technology, and the time spent by both instructors and your employees.
- Compare costs against financial benefits. These may include savings from reduced turnover, lower recruitment fees, onboarding costs for new hires, and productivity gains from having a skilled and stable workforce.
- Measure Key Performance Indicators (KPIs). Consider employee satisfaction, engagement levels and performance levels.
- Track metrics over time. This will help you determine the long-term effectiveness of your training initiatives and help you make data-driven decisions to optimise future training programs.
- Collect Feedback. Surveys can help you gauge the impact that employees feel training has on their performance, job satisfaction, and their likelihood of staying with your company.
FAQs About Training For Employee Retention
What challenges might companies face when using training as a retention strategy?
Developing and implementing training programs can take significant time and effort. If the transition isn’t handled correctly, you may also face employee resistance, and risk experienced employees leaving for other opportunities. It’s essential to align training with both employee needs and company goals to maximise its effectiveness.
How often should training programs be updated to maintain their effectiveness?
It’s important to review and update training programs regularly to reflect industry changes, technological advancements, and evolving company needs. Annual reviews, coupled with feedback from employees, can help ensure that training remains relevant and impactful for retention.
What role does leadership play in training for retention?
When leaders actively support and participate in training initiatives, it encourages employee engagement and aligns development with organisational goals. This involvement shows employees that their growth is valued, which boosts job satisfaction and loyalty, ultimately leading to higher retention rates. Effective leadership in training also ensures that the skills developed are relevant and impactful.
