Why Employees Leave: The Top 7 Reasons Behind Turnover
Your employee’s decision to leave began long before they handed in their resignation letter. It can be the sum of a few small things that went wrong, and that people patiently waited for the company to fix. But everyone’s patience eventually runs out.
The stakes of losing an employee are high. Replacing them can cost between 50% and 200% of their annual salary. And the implications aren’t only financial. Losing an employee can disrupt business operations and team dynamics.
In a competitive talent market, losing good people to preventable issues is the last thing that your company can afford. That’s why employee turnover is on every leader’s mind right now.
What is Employee Turnover?
Employee turnover is the annual rate at which employees leave your company and need to be replaced. It can be two types: voluntary (decided by the employee) and involuntary (decided by the employer).
While you have less control over involuntary turnover, you can take actions to reduce voluntary turnover. To do that, you must understand what makes people leave their jobs in the first place.
What is the biggest reason for employee turnover?
Employee turnover is the result of unmet needs and/or preventable workplace issues. There’s rarely a single reason. That said, a lack of recognition and poor relationships with managers consistently emerge in workplace research.
Both are worth paying close attention to, since they tend to amplify or lead to other issues that cause employee turnover.
What Causes Employee Turnover? Top 7 Reasons
1. Lack of recognition
Multiple studies point to the same conclusion: lack of recognition is one of the leading causes of employee turnover. In one study, 36% of employees felt so strongly about recognition that they said the lack of it made them consider switching jobs (Forbes). In another, employees receiving high-quality praise were 65% less likely to leave (Gallup).
Recognition is how people know their work is being noticed and making an impact. Without it, they can be left wondering why they’re putting in the effort at all.
The biggest problem is that recognition is still treated as a nice-to-have rather than a core retention strategy. This makes it inconsistent, less strategic and less meaningful. HR teams need the right tools, strategy and budget for a formal employee recognition programme.
2. Poor manager relationships
Managers are often the people who can make the biggest difference in whether their team feels valued and supported. In one study by Gallup, 28% of surveyed employees said that the most meaningful recognition comes from their line manager. More than senior leadership, peers or customers.
Managers are also responsible for delivering consistent, meaningful feedback, crucial for professional and even personal development. When that relationship breaks down, it can be the tipping point that leads an employee to leave.
3. Feeling unseen and undervalued
Nobody wants to feel invisible at work. When employees start to feel like their contributions go unnoticed or aren’t appreciated, their motivation and engagement can suffer. Disengaged employees are significantly more likely to leave.
Hybrid or remote employees are especially at risk of these feelings, since they can end up feeling disconnected from their in-office colleagues and informal bonding moments. That’s why extra care is needed to provide meaningful recognition to remote and hybrid teams.
4. Unmanageable workload
An overwhelming workload is one of the fastest routes to burnout. If this isn’t addressed promptly, it can lead to disengagement, negative feelings and, eventually, resignation.
Burnout can be tricky to catch unless an employee directly raises it as an issue. Some people, especially high performers, have difficulty asking for help or admitting they have more than they can handle. That’s why being proactive is very important. Check in regularly, review team capacity and encourage taking annual leave.
5. Lack of career growth
When employees don’t receive opportunities to build new skills or grow into new roles, they can start to feel stuck and look for a path forward elsewhere. Growth doesn’t necessarily mean a promotion. Providing learning resources, workshops and new challenges for employees to hone their skills is a great way to fuel ambition.
6. Poor work-life balance
No other perk, free snacks, breakfast buffets or pizza parties can make up for a schedule that doesn’t respect someone’s life outside of work. Employees value flexibility as much as they value competitive salary and extra annual leave. A healthy work-life balance is a baseline expectation that the modern workforce won’t compromise on.
7. Inconsistent or absent feedback
We already briefly touched on this point, but it’s so important that it deserves a separate mention. Feedback is the fuel employees need to grow both as professionals and as individuals. Without it, they are left wondering whether they are doing a good job, falling short or making any impact at all. Uncertainty can be worse than criticism, which can at least provide direction.
Feedback isn't very actionable when it's provided only during formal performance reviews with long stretches of silence in between. That’s why weekly (or at the very least biweekly) check-ins between employee and manager are crucial for supporting employee growth.
How Can You Reduce Employee Turnover?
Reducing employee turnover is a continuous process of identifying the reasons for it, devising a plan to address them and putting it into motion.
The pattern across all 7 reasons for employee turnover is that people want to feel seen, valued and supported so they can confidently grow and thrive in the company. None of these reasons exists in isolation. You can’t build a positive workplace culture without addressing feedback gaps, manager relationships and the lack of recognition.
If you want to start building that culture today, check out our guide to reducing employee turnover using recognition.
