Why Employee Retention Is Important

Why Employee Retention Is Important

Retaining an employee has become even more important these days than it was a few years ago. With new technologies and skills coming to the fore, a new breed of skilled people has evolved who are in acute demand in a particular industry or niche. This is creating a situation where organisations are ready to poach certain employees from other organisations and use their skills to advance their cause. It is anybody’s guess that retaining such workers is a necessity for companies. In fact, the importance of employee retention has increased manifold in the past decade.

Skilled Workers May Also Be Future Leaders

As economies become strong, talented employees become hot property. Companies are in hot pursuit of workers with specific skills. Companies should also try to retain these employees since these are the employees who can prove to be able leaders for the organization in the future.

Increasing Tenure, Appreciating Asset

The value of an employee increases with his tenure in the organization. With time, employees acquire more experience and knowledge and grow into essential cogs in the wheel of the organization. They build good rapport with clients, which is integral to the success of an organization. If you retain such employees, it is the organisation which is going to benefit more than the employee.

High Cost of Employees

It is estimated that the cost of an employee is at least twice his salary. You need to consider recruitment and training costs as well, which are increasing. You also need to consider loss of productivity owing to sickness as well as owing to roles not being filled with the right candidates.

All these factors make skilled and productive employees a hard earned stuff that merits retention measures.

Organisations invest in employees right from the recruitment and training phase. They need to protect their investment. If you are successful in retaining your employees, you can save future investment in training, recruitment etc. and also reap rich dividends from the investment.

It Takes Time and Money to Turn Freshers into Asset

Retention measures are all the more important for freshers who have been relentlessly trained by your organization and turned into a pro who is capable of handling complicated assignments. Organisations recruit freshers as trainees and invest time and money to turn them into independent centres of excellence. If such people leave for greener pastures, the HR department faces severe flak from the management. These are professionals who have been trained right from the word go. They steadily soak up the ambience, the professionalism, the technologies, the soft skills and the nuances of their roles and grow into champions of their niche. These are the people who are hot property for companies. Retain them by any measure, greener pastures are making all out efforts to lure them away with more parks and salaries.


The importance of employee retention is all more evident nowadays than in past decades. You need to take measures to retain employees, otherwise your investment in recruitment and training is futile. It is a loss on the books of your company.


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