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Retention Management – What Strategies Are (Not) Working?

The U.S. added 157,000 payroll positions in January according to The New York Times. Such job growth, however, did not result in a lower unemployment rate. On the contrary, the unemployment rate rose to 7.9% for the month. What is going on?

There must be more than one reason behind that. One could be employers now require existing employees to take over some of the responsibilities for the vacant positions until they are filled. When employers are not filling the vacant positions, the increased number of payroll positions does not help lower the unemployment rate.

Another possible reason is that fewer employers are willing to invest in candidates with less experience but great potential. Companies prefer to hire candidates who are ready to plug in and perform the job immediately --- usually those holding a similar position in a competitive firm. By doing so, companies can save a good amount of training and development cost. Therefore, it may seem everyone is “hiring,” but the truth is everyone is fighting for the same candidates who have already had a job. When no one is hiring the unemployed, the increased number of empty positions has little effect on the unemployment rate.

I consider what I mentioned above the “malpractices” in HR operations because these companies are doing nothing but “digging the grave” for themselves. Today, almost every professional is on LinkedIn. Many are also active on other social media platforms. As compared to regular staff, valuable employees are more vulnerable to be seen on the internet and be approached by a competitor. As a result, when the economy is turning around, the companies that require employees to do more for less or do not want to invest in their human capital will end up losing the top talent for the competitors.

Considering retention management is a system-wise approach to encourage valuable employees to stay with the employer, I would like to ask you the following questions: What considerations a company must take in managing employee retention? Based on what you experienced in the workplace or what you have read in literature, what tactics can employers use to manage employee retention? Which tactics work well? Which do not? For what reasons?

Relevant discussion:

Rampell, Catherine. (2013, February 2). Job growth steady, but unemployment rises to 7.9%. The New York Times, pp. B1. Also available online via
The picture was downloaded from FrankCrum


  1. I think the point you bring up about employers not hiring those with no experience, but good potential is the biggest problem with unemployment in this country. How is one supposed to gain experience if they cannot be hired in the field due to lack of experience? I think that companies need to take a risk and hire those who have potential. If a company had that kind of faith in me, I think I'd be likely to stick around and hopefully try and move up in the company as opposed to feel like I should leave for a better opportunity. Just because the job won't be done 100% correctly on the first day does not mean it won't be done perfectly in a months time. I think if you hire someone who will soon be perfect for the job with a little experience, that employee is bound to stick around. Also, this gives an employer the opportunity to groom an employee to do the job exactly how they want it done. Someone with experience may be set in their ways. There are so many positives to hiring those with potential and I think it would help lower the unemployment rates in this country. Kayleigh Newell

  2. In order for a company to manage employee retention they need to understand their employees wants and needs. No one wants to go to work everyday to be so stressed out that they do not even enjoy their jobs. Employers need to create a healthy work environment that has limited stresses from managers and supervisors because as soon as someone feels they are being pushed too far by a manager or supervisor they are looking for ways out. When work becomes too stressful, most people start looking for other positions that they are better suited for. Of course there will always be some unavoidable stresses but it becomes difficult when an employer is constantly hovering over and just gets in the way of the job being completed. In order to make valuable employees stay around they need to be treated with respect and stay relatively stress free otherwise they know their value and they will look into another position for another company.

    Bailey Sweeting

  3. Employers have to make many considerations when managing employee retention. Employee treatment is probably the biggest factor, are they paying employees enough? Have they given employees a raise? Is the work environment stable and productive? Do employees have the potential and ability to move up within the company? These are just a few questions an employer needs to address when managing retention. Based on my personal experience in the workplace I've seen good and poor retention practices. Poor being offering no room for advancement, no incentives like bonus or raise and giving employees the same menial tasks on a daily basis. I worked one entry level sales job that had such a high turnover rate because the employer put such little time and investment towards new hires and they had them working in rough parts of town consistently. I've also worked other jobs where employee appreciation is exhibited in ways like employee of the month, performance related bonuses, discounts promotions and letters. I worked one job at a warehouse department store where there were many avenues for raise, qualifications and promotions were available even after working for only 3 months with the company. Employee reviews, and openness to feedback are two great tactics a company can use to line up the desires of the company with the desires of the employees.

    Bill Visconte

  4. This issue of retention definitely affects the companies that do not invest enough time into their employees. Companies have to have a healthy balance in having the best interest of the organization and their employees in mind. I have had experience of this in the work place. I worked a coffee shop that was in a resort. They never had our interest in mind; it was constantly about the sales. And while I have to agree that making the customers happy is the number one priority, companies have to make their employees happy too. We all gave ideas as to how to make our workplace a more productive and positive environment, but nothing ever worked out. This resulted in an extremely high turnover rate in the shop. On the other side of the spectrum I am now in a position where there are incentives for working hard and doing well. The environment can be stressful at times, but it is always positive; it means a lot to have someone tell you that you are doing a great job every once in a while. So tactics that seem to work great are creating a positive work environment, using positive feedback and constructive criticism, and being consistent in punishments and rewards amongst employees. These tactics allow employees to feel as though they are being fair to everyone and make them more apt to be happier and in the end for them to stay longer. -Amber Jones

  5. If the workplace was to break the cycle of only hiring those with a lot of experience, say with a competitor in a similar position, those that are less experienced but with a lot of potential could then fill those spaces. So these managers must hold on to their employees while still being able to open up spots for new faces. Employee retention is important to businesses. However, they want to limit the expense of employee retention. I thought the cartoon was a funny example of this. It reminded me of job enlargement that we talked about in class. Most employees I think would not find a title like those as advancement however unless the position was accompanied with extra compensation. This might deter some companies from certain things that could be done to better retain their employees. Ali Pregent

  6. In order for the unemployment rate to lower, employers are going to need to hire employees who do not have experience, but are filled with potential. In the hiring of these inexperienced individuals who have potential, you are also allowing yourself to keep a high employee retention rate. By filling positions with new individuals they can grow with the company and gain more benefits through working there. This keeps the employees within the same company thereby limiting fees for training. By having compensation employees will be more likely to stay and help the company prosper. I think if employers make the environment a positive one employees will be more inclined to stay within the company. Amanda Vecchi

  7. Isn’t business all about taking risks? You win some, and you learn from other risks made. From what I have learned it is not as easy to be successful in a business if you are not willing to take the necessary risks. Granted these risks are meticulously calculated and strategized, so there is little room for error, but the still can be considered risky. So when it comes to the unemployment rate increasing and open payroll positions available, wouldn’t a company want to fill them? I understand the fact that our country is in a recession, or finical crisis, at the moment, and conserving every penny counts. However, take the perspective of the employee: working over-time to make sure their families are secure; always tired, not as excited to go to work each day because of what is to come. I propose the idea of spending a little money to make double or triple back. Invest in those driven, enthusiastic, and fresh perspectives. This way some of the workload is taken off already existing employees, and maybe their quality of work will improve. Maybe this fresh air, so to speak, will bring in new positive ideas to the company.


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