In a red-hot job market, the exit interview may be your secret weapon in retaining and hiring new staff. Ignore their comments at your peril.
Hiring and job changes have reached a fever pitch, with record numbers of unfilled jobs and job changes reaching new highs. This frenzy has impacted all segments of the economy, from local restaurants reducing services due to staff shortages, to white-collar employees trading employers for higher salaries and new remote work options. This is not news to any tech leaders trying to hire new employees, as IT has been significantly impacted by these trends as pandemic-driven employee loyalty seemingly evaporated overnight as the job market reopened.
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Replacement costs are high
Estimates for hiring a new employee versus retaining an existing employee range from a low estimate by Employee Benefit News of around 33% of the employee's salary, to highs of 50%-70% according to the Society of Human Resource Management. There are likely additional "soft costs" ranging from productivity losses as work must be reallocated to morale impacts on the employees who remain.
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Some degree of turnover is always expected and sometimes helpful, but large exoduses can have a compounding negative effect, especially with a workforce that's been performing above the call of duty during the pandemic. Now those who remain are being burdened with picking up additional work from those who have departed increasing the risk of further attrition. Rather than shrugging your shoulders and assuming this is just another fact of post-pandemic life, it's worth deploying tactics to mitigate the impacts of departing employees, especially one that's simple and often underutilized: the exit interview.
You can benefit from the exit
It's human nature to feel a sense of betrayal from an employee leaving, but it's a natural occurrence even if it has recently accelerated due to unusual factors. If you're already paying for increased turnover, you might as well maximize the value that you capture when it occurs. Exit interviews are a great way to do so, and an activity that's routinely ignored or left to HR, or worse yet, an online survey that's never analyzed or acted upon.
In an informal poll I conducted with coworkers and friends, out of about a dozen people, precisely zero received a request for an exit interview from their employers after they resigned to pursue another job. At the same time, I'm hearing companies express concerns about why employees are leaving, yet they're ignoring the most obvious and accurate source of data about employee departures: asking employees why they're going!
More than half of the people I spoke with mentioned that they'd be more than willing to participate in an exit interview and would willingly and honestly respond to questions ranging from why they were leaving, to what they loved and loathed about their soon-to-be-former employer. It's flummoxing to see companies that spend a significant amount of money on recruiting, job market research and data collection, ignoring one of the richest sources of data available to them that happens to have a near-zero cost to acquire.
Ask the right questions
Part of the unwillingness to conduct exit interviews seems based on a view that a departing employee is tainted or has somehow betrayed their team and employer and perhaps there's an assumption that an exit interview will be vindictive and nasty. I've conducted dozens of exit interviews, and only one might be classified as tense, yet the criticisms were largely legitimate despite being a bit brusquely delivered.
Rather than viewing an exit interview as an interaction with an adversarial foe, start the interview thanking the individual for their contributions and wishing them well at their future pursuits. Assuming it's genuine, express your interest in improving your organization based on their feedback. Listen more than you speak, and don't take any criticisms personally. Rather than getting defensive, seek to understand the root of the employee's concern. Pay is usually not the sole factor, so digging a bit deeper can provide valuable data.
Look for trends and themes across multiple employees. A single individual's concern about leadership doesn't mean it's time to ring the CEO, but if you consistently hear about leadership's seeming lack of concern for employees or team leaders that disrespect their teams, these are concerns worth capturing and addressing.
Quickly put feedback into action
The magic of exit interviews comes into play once the feedback is captured, themes identified and mitigations put into action. Not only does this reduce turnover today, it also makes your organization a more compelling place to work tomorrow. Furthermore, your departing employees likely still have friends working for your organization. Merely demonstrating an interest in their thoughts on how you can improve and putting those thoughts into action will be relayed back to those who remain on your employee rolls. In short, this is one of those rare no-lose activities that can be implemented with little more than a few hours of phone calls.
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