Listen, retain, succeed: Reduce turnover with these 3 strategies

Employees will inevitably leave your company at some point—whether they’re pursuing another opportunity, switching career fields, or leaving the workforce entirely—and that’s okay. But when attrition comes in unexpected waves, the effects can reverberate throughout your organization:

• The average tenure of remaining employees decreases, which means institutional knowledge is lost, which trickles down to member experience.
• Remaining employees absorb the work, which leads to overwhelm, role confusion, burnout, and lower engagement.
• The company has to spend time and money recruiting, hiring, and training new employees instead of focusing on strategic priorities to drive the organization forward.

These can contribute to serious losses for credit unions and their members, and are always worth addressing—let alone preventing. While higher compensation is part of the equation, it isn’t a cure-all for long term retention. The best HR teams (and their organizational leaders) know that retention must be supported by holistic, dynamic employee experience strategies. Here’s how.

1. Enable learning and development for all employees

The 2023 Crowe Bank Compensation and Benefits Survey found that 44% of respondents cited lack of career development opportunities as a reason for seeking employment elsewhere. Creating a culture of learning and development (L&D) means employees have opportunities for growth that are relevant, engaging, and accessible.

But of course, it’s easier said than done. Here’s where to start:

• Identify skills gaps to keep up with competitors. Research what skills other banks and financial institutions are looking for, and invest in training for employees to upskill or re-skill in those areas. While it might sound like you’re preparing employees to get poached, you’re actually providing them the learning opportunities they might have left to pursue.
• Ask employees about what’s missing. Do they want formal training opportunities, or would a mentorship program, or access to industry resources and peers suffice? It’s likely there will be many ideas, but that’s a good thing. More ideas helps HR be creative and intentional about spending budget wisely.
• Make internal mobility an HR goal. Career development falls flat if employees have to leave in order to actualize their promotion or professional goals. Internal mobility goals ensure HR’s accountability to promote and retain employees who have put in the work to grow in their roles.

2. Invest in DEIB at every level of the organization

Diversity, Equity, Inclusion and Belonging (DEIB) fell significantly on HR’s priority list this year, according to Lattice’s 2024 State of People Strategy Report. And the Society of Human Resource Management’s divisive statements about removing equity from the equation only made things worse.

Credit unions can’t afford to take part in that slippery slope. A 2020 McKinsey & Company report on racial equity in finance showed that women and people of color are exponentially underrepresented at higher levels:

• White men see more than double their representation from entry level to C-suite, but white women see a 29% decline in their representation.
• Meanwhile, men of color see a 58% decline, and women of color see a 90% decline—the most drastic drop.

Yet studies repeatedly show that diverse, inclusive teams perform higher than less diverse counterparts. In 2023, McKinsey & Company’s Diversity Matters Even More report found a 39% increased likelihood in outperformance by diverse teams. Credit unions can stand to benefit from margins that large, and so can their members. Think of it this way: Ethnic and racial minorities make up 42% of the American population, why shouldn’t your workforce be just as diverse as your member community?

But investing in DEIB doesn’t stop at the hiring phase, it should touch every aspect of the employee lifecycle, from recruitment and training to growth and development to engagement and retention. Consider these tactics:

• Develop more inclusive job postings. Evaluate the words you use, revisit educational requirements and necessary qualifications, and include salary ranges to help encourage a more diverse pool of candidates.
• Make performance reviews more equitable. Managers often have unconscious biases, but performance reviews can be structured to combat those biases. Train managers on bias, consider 360 reviews to reduce bias, and use standardized performance criteria for reviews, promotions, and pay.
• Survey employees about what would improve DEIB. For topics as nuanced as DEIB, it’s hard to guess what employees want, so ask. Employees are more likely to engage with and support programs when they’ve had input opportunities.

3. Make career paths accessible and transparent

When employees can’t see a career path in their current job, they’re likely to look for it elsewhere. A 2023 survey by Lattice and YouGov found that employees want more trust, clarity, and recognition in order to reach the next level of their career.

Career paths help standardize growth and clarity: They give employees short and long-term goals to grow in their role, clarify how to move up or across departments, and help managers evaluate promotions fairly. But just the act of having career paths isn’t enough: effective career paths include these crucial qualities:

• Foundational: Career paths map out the skills, knowledge, competencies, experience, and personal characteristics required for each job level as an employee moves up.
• Meaningful: The language should be easy for employees to understand. Avoid jargon and keep the wording aligned to organizational values and skills.
• Accessible: Employees should know what it takes to get promoted, and what the path ahead looks like. Publish career paths for each role in a central place everyone can access.
• Growth-oriented: If each step seems unachievable or unappealing to your employees, then they won’t help you encourage employee engagement or performance.
• Measurable: Employees, managers, and HR should be able to measure an employee’s growth against their current role, and easily identify potential to move up or across the org.

Employees should be in the driver’s seat of their development, but they’re owed structure and clarity from HR and managers. Accessible career paths are just one aspect of that structure, but are still crucial.

The bottom line: Listen up

You might have noticed the central theme: ask employees what they want. A little listening goes a long way with employees who have nuanced and varied needs. Pulse surveys, town hall meetings, and continuous feedback are all meaningful and realistic opportunities to find out what employees really think.

What got you here likely won’t get you there, meaning it’s natural and inevitable to have to evolve retention strategies alongside your workforce. For more ideas, check out Lattice’s article, How to Define Career Paths for Credit Union Employees.

Lattice is a CUES Premier Supplier Member.