The unemployment rate in America has declined steadily in recent years and the decrease in national unemployment gives qualified talent a wide range of job opportunities, and employers have to compete more to attract and retain the top people, who are aware that they have many employment options. In fact, as of 2017, more than half of currently employed people are actively looking for new jobs.

The High Cost of Employee Turnover

Even without the added pressure of a low unemployment rate, employee turnover carries a high cost. Losing a seasoned employee and replacing them with a new one affects several budget areas: 


Separation costs: Every employee who leaves an organization incurs some degree of cost. The costs associated with losing an employee include any severance pay, unemployment insurance, the cost of continuing benefits, and so forth. There is also additional labor involved in removing or changing payroll and benefit status, technology and physical access procedures, exit interviews, etc. 

Recruitment costs: It costs time and money to fill vacant positions. HR and hiring teams need to update or assess job descriptions, post-employment ads, review resumes, check references, and conduct job interviews. These costs can be even higher if your organization requires pre-employment skills testing, multiple interviews, or has additional recruiting procedures. 

Onboarding costs: New hires also always incur some costs. Again, there is updating of employment records and payroll rosters, benefits plan adjustments, and physical facility and technology access. New hires often come with needs or preferences that should be addressed: they many need slightly different software, or a new chair or office equipment that wasn’t needed by the previous employee. The new hire also requires employee orientation and training, and will take some time to develop into performing at the same level as the employee they replaced. 

Productivity costs: All of this impacts productivity for your existing team. When one employee leaves, the remaining employees need to adjust to redistribute the extra work and cover the vacant position. When a new employee is hired, the time spent training the new hire and answering questions requires even more time and investment from existing employees. The new hire won’t have the experience and expertise that the previous employee did, so the change can impact whole teams and departments for some time, and creates additional stress and lowers morale for existing employees.

Cumulatively, the cost to replace a single employee is generally estimated at 33-100% of the annual salary for that position, and an average of $15,000 per employee.

Causes of Employee Turnover

For all those reasons, retaining skilled and experienced employees is a high priority for most organizations. Here are some of the most-cited reasons why people leave their jobs: 

Poor relationships with management or coworkers. You’ve heard it said that “people don’t leave their jobs, they leave their boss”. Employees who don’t get productive feedback, helpful recognition, and build good relationships with the people they interact with on a daily basis are more likely to leave their jobs. 

Bored and unchallenged by the work. An employee spends more than a third of their time at their job. If they find the work boring or repetitive, they are likely to look elsewhere for more enjoyment and satisfaction at work.

Lack of growth opportunities. One of the primary reasons employees stay with a job or a company is when they can see growth opportunities or career progression. Even when they aren’t thrilled with their present role, if they view it as an investment in their future, they are likely to stay. 

Lack of engagement. Engagement can be driven by multiple factors: good morale in the company or in their team, work that they are excited about and interested in, a company or leadership that they feel passionate about, a sense that their work has meaning and significance. Engaged employees are more productive with their time, help others work better and more effectively, make stronger contributions to the company, have better attendance, and are more willing to go that extra mile to improve results.

While no company can control or eliminate all these factors all the time, companies that spend time and resources improving their culture and creating a happier work environment not only improve retention, but they tend to also see real, measurable improvements in productivity, length of tenure, and skill level and expertise of their talent pool. Now, more than ever, it’s important to invest in building a company where employees want to stay.

How eLearning Improves Employee Retention

An intelligent Learning Management System (LMS) offers many ways to improve employee satisfaction, lengthen retention, and increase productivity. Good eLearning systems can: 

Ease the strain of onboarding new hires. Your new hire training can be tailored to deliver not just knowledge and job training, but reflect your company values and culture. Training can be immersive and dynamic, building new hire engagement from the very beginning. 

Develop the skills of existing employees. Training shouldn’t stop at onboarding. Whether your goal is to advance the strength of your talent pool by honing their existing skills, or cross-train to enhance collaboration, innovation, and teamwork, your learning initiative should be an ongoing effort. 

Improve recognition. Recognition is a key factor in job satisfaction. By creating certificates, incentives, or reward programs, your most highly-trained employees can demonstrate their value and have their efforts acknowledged. 

Provide avenues for growth. You can use your elearning platform to map out a plan for growth and advancement that helps employees invest in their long-term future with your company. Growth opportunities deepen motivation and engagement. 


If you aren’t using a learning management system, or only using in-person training during a new hire period, you are missing out on opportunities to deepen and strengthen your existing talent pool and improve productivity. An LMS is a large commitment, but it can give you huge returns on investment when you use it to create a culture that keeps employees committed to staying and growing with your company.


If you would like to learn more about how to use an intelligent, immersive, dynamic, and flexible LMS to benefit your employees, your company, and your customer every day, get in touch.

At Knowledge Anywhere, we recognize that learning has to be measured, permanent, applied and encouraged not just on the first day, but throughout the employee lifecycle. We designed ourlearning management software to help companies directly, manage and track all training activities through one centralized platform. In this way, your employees can easily meet compliance standards, new hire requirements and have ongoing employee enrichment. If you’re interested in learning more, feel free to schedule a tour of our eLearning suite.

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