Career Development Proves Key to Addressing Retention

The caliber of development programs can determine whether talent stays or goes.

When turnover happens too often, organizations' budgets can suffer: Estimates of turnover costs range from $4,000 per employee to 1.5 times an employee's salary. Evidently, the career development services provided by talent development or learning departments might be the solution to minimizing those costs. According to Work Institute's 2017 Retention Report, which interviewed 240,000 employees to identify the reasons people leave their organizations, career development was both the most common reason people left and stayed with an organization.

Of the 22 percent who said career development was the top reason for leaving their companies, one-third say they left because of the type of work they did. In other words, expectations about the job didn't match up with the type of work involved or the hiring process failed to provide a realistic view of the position. Two out of 10 in this group of participants left due to lack of growth and development. Employees want to feel challenged; failing to use their knowledge, skills, and abilities can catalyze turnover.

While it's important to understand why people leave their companies, it is equally critical to know why they stay. Work Institute found that career development was the number one reason employees stayed. Thus, employers could optimize their retention rates with a strong career development strategy.

The report suggests that a little investment can go a long way when it comes to using talent development to drive retention. The study calculated that a $100,000 investment in retention will pay for itself if it prevents just seven employees who earn the median salary for a U.S. worker from leaving.