Employee turnover is costly both financially and operationally and this extends beyond recruitment expenses, it affects productivity, morale, and ultimately, revenue. Recent studies by Gallup indicate that replacing an employee costs anywhere from 50% to 200% of their annual salary depending on their role.
With the increasing competition for top talent, it’s pertinent for companies to rethink their retention strategies to keep employees engaged and committed.
So, what then is really working in 2025?
We analyzed top-performing retention strategies, and in this blog, we will be sharing five research-based strategies to reduce attrition and retain your best employees.
Key Takeaways
- Employee experience (EX) drives retention. Companies investing in EX see 122% higher revenue growth.
- Compensation isn’t just salary. Custom benefits like healthcare, bonuses, and career growth improve retention by 40%.
- Recognition matters. Companies with strong recognition programs see 31% lower turnover.
- Career development is key. 94% of employees would stay longer if their company invested in learning.
- Work-life balance improves retention. Companies prioritizing mental health see 20% lower attrition.
- An exclusive report by employees and HR Managers across Nigeria that uncovers real reasons behind employee turnover and most effective retention strategies. Download here
Now, let’s dive into the five proven retention strategies that top companies are using and how you can implement them today.
1. Redesign the Employee Experience (EX) for Retention
Companies spend millions optimizing customer experience, but many tend to forget about employee experience which is equally important. A study by McKinsey found that employees with positive work experiences are 16 times more engaged than those with poor EX. Also, companies with strong EX programs outperform competitors by 122% in revenue growth over three years.
How then can you improve EX for better retention?
- Use career mapping tools to help employees visualize growth opportunities within your company.
- Invest in seamless digital tools that enhance collaboration, especially for remote teams.
- Create a flexible work arrangement; have a hybrid or remote work option as this can improve satisfaction and productivity.
Actionable takeaway: Audit your employee experience today. Conduct surveys to understand pain points, and prioritize improvements in career development, workplace tech, and daily operations.
Related: Proten International’s HR Advisory Services can help optimize employee experience
2. Rethink Compensation Beyond Salary
Compensation isn’t just about base salary anymore. Employees want total rewards packages that align with their lifestyles. According to a study by SHRM, 81% of employees say benefits impact their decision to stay at a company.
What you can do:
- Offer customized benefits: Let employees choose between traditional healthcare, mental wellness programs, or financial planning perks.
- Implement performance-based bonuses: Align incentives with business goals and recognize top performers.
- Introduce profit-sharing or stock options to create long-term commitment.
Actionable takeaway: Conduct an internal survey to understand what benefits matter most to your employees and optimize your total rewards package accordingly.
3. Foster a Culture of Recognition and Belonging
Employees don’t just leave jobs, they leave work environments that don’t make them feel valued. A survey conducted by Gallup shows that 69% of employees say they’d work harder if they felt more appreciated. Another survey found that companies with strong recognition programs experience 31% lower voluntary turnover than those that don’t (Bersin by Deloitte).
How then can you build a strong culture of recognition:
- Implement peer-to-peer recognition platforms (e.g., Bonusly, Nectar) to encourage appreciation across teams.
- Celebrate small wins and major milestones, from work anniversaries to project successes.
- Foster inclusivity by actively promoting diverse leadership opportunities.
Actionable takeaway: Learn actionable tips on how to create a thriving work culture.
4. Invest in Skills Development and Internal Mobility
Career growth is a major retention driver. If employees feel stagnant, they sure will look elsewhere. LinkedIn Learning conducted a report and found out that 94% of employees say they’d stay longer if their company invested in their learning. Yet, only 34% of companies provide structured career growth programs.
Your organization can implement better learning & development by building a mentorship program where senior leaders actively guide junior employees;
- Offer microlearning opportunities—short, skill-based training that fits into busy schedules; Proten International’s Corporate Training Services
- Promote internal job rotations to keep employees engaged in new challenges.
Actionable takeaway: Launch an internal talent marketplace that highlights career mobility within your company.
5. Support Mental Health and Work-Life Balance
Burnout and mental health issues are major contributors to attrition—yet, many companies still overlook them. A 2023 report from the APA found that over 60% of employees say mental health benefits are a key factor in job decisions and companies that prioritize mental well-being experience 20% lower turnover rates.
As an organization looking to thrive, you can support mental health & balance by implementing mental health days as part of your leave policy, providing on-demand therapy and wellness coaching as part of your benefits, and encouraging leaders to model healthy work-life balance behaviors (e.g., no late-night emails, no derogatory use of words).
Final Thoughts
Employee expectations are changing, and traditional retention methods no longer work. Companies that adapt to these shifts will retain top talent, while those that don’t, risk losing their best employees to competitors.
Want deeper insights into why employees leave and what’s actually working in 2025 across the world to retain top talent? Download our exclusive whitepaper featuring employees and HR Managers across Nigeria.
Need expert HR support? Talk to Proten International to help you build a strong retention strategy today! Contact us.
