A typical employee turnover rate in Australia is around 15 percent and has been declining over time. However, in specific industries, this rate is nothing but a pipe dream. In these sectors, higher than average employee turnover has a lot more do with factors outside of the employer’s control. The result is that employers in these industries need to put more effort into investing in and valuing their staff.
It’s important to know what to do if your business operates in one of these industries. So which ones struggle the most? What strategies can you implement to reduce your turnover rates and keep quality staff for longer?
Hospitality and Food Service
The hospitality industry carries the highest employee turnover rate globally! Multiple factors, including seasonal employment, an entry-level and low-skilled workforce as well as relatively low wages, combine to influence the rate at which employees change their roles profoundly.
Hospitality and food service workers are on the front lines, dealing with a large number of customers and stressful scenarios. In Australia, this results in the employee turnover rate being over double the average! The turnover rate is far higher for service and cashier staff, while closer to the all-industry average for bar staff and managers.
Rental and Real Estate
Sales-based jobs are the next most abandoned jobs across the Australian workforce. The rental and real estate market is incredibly cutthroat and competitive. Dealing with tenants and variable pay structures leads to many workers choosing to take their efforts elsewhere. While not as bad as frontline service workers, the attrition rate is far higher than the national average. Furthermore, quality real estate staff are difficult to find, let alone keep.
If you operate in this industry, look after your staff well as the cost of them leaving may be significant. An international CAP study calculated that a typical cost of staff turnover is around 20% of an employee’s annual salary. Even for an entry-level assistant on $50,000, that $10,000 cost is substantial – and for sales executives, this cost is even higher.
Transportation and the ‘Gig-Economy’
Jobs in the transportation industry are not particularly sticky. The rate of employee turnover has ticked up in recent years. This is in part due to the introduction of the sharing economy, which promotes short term gigs, such as Uber, UberEats and other home delivery services. Data from Uber themselves show that 11% of new drivers stop driving within just one month. With less than 50% of them remaining for longer than a year. If you rely on transportation staff, make sure you give them a reason to stick around!
Other Factors Influencing High Employee Turnover
New research from Gallup shows that Australian companies are facing an employee engagement crisis. According to the study, only 24 percent of the workforce said they felt engaged with their work. Worse still, that figure is only getting worse over time, and recent events have done little to help employees feel secure in their roles. If employees are not engaged, they are more likely to look elsewhere, right?
Furthermore, turnover is higher in industries that pay workers an hourly wage, as opposed to a salary. Staff that are paid less are more likely to keep an eye out for a new opportunity that pays them better, offers better benefits or helpful payment plans that improve their sense of financial wellbeing.
How to Reduce Employee Turnover in Your Business
If you want to reduce the risk of losing your best employees to competitors, you need to offer them a reason to stay. This might be incentives to stay engaged, raising wages, offering them flexibility or other benefits to keep them happy.
Another option to consider is to offer an Earned Wage Access solution, which acts like a paycheck advance app, like Paytime. Paytime is a get paid today app that allows your employees to access their earned wages on their terms, instead of waiting until their usual payday. They can withdraw funds just like an ATM, for less than the cost of a cup of coffee. Paytime is a great tool to establish financial wellness in your employees and reduce financial stress by equipping them with a means to cover any emergencies that can come their way. Earned Wage Access is a valuable benefit to your employees and is an easy way to encourage them to stay with your business.
Offering flexible access to earned wages to your workforce is one factor that may increase the loyalty of your staff. If your company wants to empower your employees to improve their financial wellbeing by enabling flexible, on-demand access to their earned wages, contact Paytime today!
