Employee Churn and The Future of Your Business

Employee Churn and The Future of Your Business

Employee turnover is not a new issue.  But judging from a number of media reports in recent weeks, the issue is becoming increasing widespread in the post-pandemic environment. 

This should come as no surprise in the wake of our collective experience over the past fifteen months.  Even before Covid, there were numerous reports of employee burnout, and recent surveys show well more than 50% of US employees reporting some symptoms of burnout.  Indeed, that percentage is likely higher since burned out employees tend to ignore surveys.

Against this backdrop it is no surprise that a recent study  found that more than one-quarter of all employees indicated that they plan to seek new employment as the pandemic winds down.

The growth of work-from-home during the pandemic also is likely to contribute to increasing employee turnover.  While most workers are anxious to return to in-person work at least in part, those able to work from home over the past year now regard that option as a benefit that companies should continue and even expand.

Extraordinary churn in the employment market will be especially problematic for small and mid-size companies.  These companies tend to run lean and often lack bench strength even for critical roles. Worse yet, companies of this size often lack the formal procedures and processes that would enable continuation of activities without serious interruption.

How to Respond – Near Term

In the near term, companies should focus generally on communication and flexibility; and more specifically on retaining their most critical employees.

Stress, whether at work or at home, causes employee dissatisfaction and disengagement, leading directly to high turnover, especially in a tight labor market.  To combat this anxiety it is crucial that employers communicate clearly and often, both about specific tasks and expectations, as well as the general direction of the company and its plans for the future.

It is also helpful for this communication to be two ways.  Employers should seek out employee feedback, through surveys, employee forums, and even informal conversations, and involve all stakeholders in planning and developing new work policies.  This is especially important with respect to the continuation of remote work.  Research has shown that nearly one-half of remote workers will seek new employment if their company does not offer some type of remote work option in the future.

This finding highlights the need for flexibility.  The expansion of remote work during the pandemic gave employees increased freedom not only to work from home, but to adjust work hours.  Paradoxically, while many remote employees complained about longer work hours and deferred time off, they also found more time available to spend with their families.  Providing enhanced employee choice through options such as a hybrid in-office and at-home work schedule will go a long way towards employee retention.

Finally, employers should recognize and act on the simple fact that some employees are more valuable and more indispensable than others.  Companies should go out of their way to be certain that their key workers and high performers are satisfied, and take the steps necessary to ensure that they remain with the company.  Any costs associated with retaining key workers are likely to be significantly less than the cost of disruption to the organization and the recruitment and training of replacements.

How to Respond – Long Term

As the world edges back to the pre-pandemic norm, now is the ideal time to take a step back and re-assess your organization.  Organizations evolve in unplanned ways, often times due to the particular capabilities or limitations of individual employees.  At this time, though companies may need to react defensively to the threatened loss of key workers, the same environment creates opportunities to recruit and hire new talent. 

In seizing the moment, companies should do so thoughtfully.  Any re-assessment should include a review of long-term objectives and aspirations, and re-imaging an organization tailored to achieve those goals.  From there, the company can concentrate on retaining critical workers and recruiting others needed to fill any gaps.

In conjunction with an organizational re-assessment, it is also a good time to re-focus on developing a process orientation throughout your company.  This means considering and documenting each step in a company’s activities.  Vulnerability to departing employees will be ameliorated by assuring that there are established procedures in place to allow other current or even new employees to quickly step in and perform critical job functions. 


The disruption to the work environment created by the pandemic will continue to have a profound impact on companies and their ability to retain employees. By combining quick, immediate action with a longer-term view, agile companies will be able to weather the current storm and create a firm foundation to sustain their business into the future.