Why we can't ignore the costs of training and support

I met with a fellow professional recently (let's call him Paul) to talk about some industry trends concerning employee retention. Paul is a manager who is struggling with employee turnover and retaining skilled employees. We decided to catch-up over a coffee.

Paul: I’m getting really concerned.

Me: What about?

Paul [Stirring his espresso...with 4 sugars]: I seem to be constantly having to re-hire. It's pushing costs through the roof and slowing down productivity. It's even effecting our quality of work. Every time we think we have someone on the right-track, they leave and it's usually within the first 6 months.

Me: 6 months, I see. Are you looking after them?

Paul: We're offering pretty good salaries, we give them good perks... I just can't put a finger on what it is.

Me: Do you have a good on-board induction program? Are you providing on-going support? Do you have a mentor program? Are your policies clear?

Paul [tastes espresso]: umm, apart from the initial week of orientation, everyone's expected to do their own learning. There are so many resources out there to learn from: plenty of search engines. Besides, the company cut our training department years ago and thinks it's been doing ok.

Me: Could that be the big reason: training?

According to some statistics out there, about 30 percent of employees leave within their first 6 months and believe it or not, about 80 percent of them are in entry-level or intermediate positions. These come with their own repercussions because the workload is left to the remaining employees who need to make-up the extra hours. This makes those employees also likely to look for other work.

Paul: Wow, those are scary stats.

Me: Then there are initial legal costs, interview costs, the cost of scanning through resumes, talking to recruiters... I can't imagine what you're going through.

Paul: [adds another 3 spoons of sugar and lets out a deep breath] It's really frustrating.

Me: According "The Wynhurst Group", the cost of losing an employee in the first year is estimated to be at about three times their salary. Not a figure you can easily ignore, especially if you're having to replace staff every 6 months. Apparently a good on-boarding program almost ensures around 60% of new hires will be around after three years. It seems like the main reason appears to be a relevant, structured, on-going training and support program. 

Paul: Training’s always been seen as an overhead.

Me: I would think these stats should be a pretty good reason why training is not an overhead, but more likely an investment. Problem is, it's sometimes difficult to track the benefits by looking at “the numbers”. Training affects productivity, motivation, accuracy, which in-turn can have a negative impact on your customers. To me, it goes beyond necessity and investment: It shows staff they are cared for. Lots of benefits of on-going training :).

Paul: Not sure I need to hear the others...

Me: Well if you do, there are plenty of search engines...!


Thanks for reading... hope you're well looked after!

Gabriele Ciminelli