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Reducing Turnover Through Employee Benefits Statements When an employee resigns, the company experiences a huge loss when expenses such as separation pay, training and interview costs are taken into account. As per the Society for Human Resource Management, the company spends around $3,500 to replace a single employee with an hourly wage of $8 – and this number is the minimum according to studies on the expenses of turnover. While turnover costs seem high now, many experts project that these turnover costs may even go up. Since the first Baby Boomers turned 60 and retired, there will be more retirements to follow. Employers will have difficulty finding talent since the new generation joining the workforce has fewer than 33 million individuals. A smaller number of people to choose from makes hiring more expensive for employers. One way to reduce turnover is to to understand the reasons why employees are resigning from the company. In a survey conducted by the Society for Human Resource Management, employees were asked for the factors that may lead them to leave their current position. According to the survey, the number one factor why employees decide to separate with the company is to seek for better compensation and benefits.
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A company may not have enough budget to increase their current employees’ salaries or improve the benefits provided.How will the staff turnover be reduced if there is no extra money?
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Retaining employees may not be as simple as increasing their salaries or offering new benefits. Detailed employees benefits statements could make them rethink their decision to leave or resign from the company. A total compensation statement looks like traditional pay statements but puts monetary value to benefits such as 401(k), health insurance, leaves or time off, as well as additional perks like company-issued mobile phones and free parking. Companies can generate these statements at a very low cost by utilizing a compensation statement software. A total compensation statement can show your employees the true value of their benefits, helping them readjust their thinking and may stop them from searching opportunities elsewhere. This will help reduce your turnover rate and also dramatically lessen your hiring budget. Reduced employee turnover can save the company money and this money can be reinvested in order to provide them increased compensation and improved benefits that they were seeking for. An employee compensation statement software is a great tool that any company can easily use and should utilize. There are many compensation software vendors to choose from, but pick one that can provide your employees timely, relevant and important information. A total rewards statement helps in retaining current employees, aid in recruiting highly-qualified staff for the company and boost overall morale.