Why is it important to retain staff in tech?
No company likes seeing their staff levels reduce but recent recruitment issues have put a premium on IT employee retention
Staff retention is an issue easily masked when your company is hitting revenue targets or landing major clients. Some companies continue to grow while suffering from staff retention issues – increasing their recruitment and training schemes to ensure teams increase in size. While employers know that the days of the ‘job for life’ are gone, they still struggle to hold onto talented staff that they’ve invested important time and money in.
One industry where staff retention has emerged as a major difficulty is IT. Low numbers of experienced staff in fast-changing fields like Big Data, Artificial Intelligence and cyber security mean highly competitive salaries may tempt your staff away. But before we discuss the importance of tech staff retention, let’s look at why it’s so difficult in the first place:
Why is staff retention so difficult in tech?
Staff retention for tech roles is a global problem. In America, the national average tenure for software engineers is 35 months and it’s lower in the country’s major tech hubs (28 months in Seattle and 27 months in San Francisco). If the natural competition between organisations doesn’t make your staff retention difficult – with salaries rising as companies snap up experienced talent in sectors like cyber security and business intelligence – then you may still feel the lingering effects of the ‘Great Resignation’ of the COVID pandemic.
The UK, like many other countries, has now moved into a stage of ‘living with COIVD’ but many workers used the sudden change to assess their career goals. In July 2021, CWJobs reported that many tech workers planned to make a career move in the following 12 months.
That’s roughly half of all workers considering making a change.
The fact that the pandemic forced many companies to adopt remote working policies should also not be underestimated. Many people worked from home for the first time and felt a marked improvement in their work-life balance. It’s reasonable to think that workers who were considering becoming freelancers used the pandemic as a ‘trial run’. Once offices re-opened, those that struggled to work from home happily returned to them, but others who were previously cautious about becoming a freelancer were given a boost in confidence.
What does all this cost? Research completed by the Society for Human Resource Management found that “replacing a salaried employee costs between six to nine months’ salary on average” (reported via Randstad). This is compounded by the fact that technology has experienced some of the largest wage inflations amongst all industries – dominating lists of roles that have experienced the highest increases.
Why is it important to retain your tech staff?
You’ll keep your knowledge in-house
Retaining the staff as your company moves from project to project is invaluable. When someone leaves your organisation, you may be able to quickly find a contractor who has a comparable skill set. On the surface, you’ve swapped like-for-like but this is not the case. The contractor will not have the lived-in experience of having already worked with your systems that can cut down lead times and help you avoid bugs. Ultimately, any time spent getting a contractor ‘up to speed’ is time that could’ve been put towards developing new solutions and making progress on a project. There is simply no way of quickly replacing the knowledge lost when an experienced member of your team leaves your company.
You’ll make recruitment and training easier
According to Nimmi Patel, Skills and Diversity Programme Manager at TechUK, [t]he UK’s tech sector is growing at 2.5 times the rate of the rest of the economy.” This is naturally positive news and creates a wealth of new jobs. However, we know that the UK is still facing a massive shortage of digital skills. That means many companies’ recruitment and training recourses are already focused on filling these new positions. If experienced staff leave one of two things are likely to happen:
- Greater strain is put on internal recruitment and it takes longer for you to fill vacancies, especially senior positions
- Costly contractors are brought in to cover resources gaps
Retaining your staff means you keep your organisation’s recruitment running smoothly. It also makes internal training easier. Just as we mentioned that keeping product knowledge in-house means projects become more efficient, you’ll also see that a community of best practices can grow from retaining experienced staff – each person sharing ideas and experiences to support each other (especially junior members).
You’ll improve your customer experience
If your business is being propped up by contractors or recent hires who lack detailed knowledge of your product/services, your business will be prone to making more mistakes that impact customer service. Errors in order processing, customer account management difficulties or retail Point of Sale systems failing can all occur because of limited IT support and customers a negative experience. In turn, customers can share negative reviews and before you know it, staff retention issues have damaged your brand’s reputation with its customers. Retaining IT staff with knowledge of your product means retaining knowledge of your customers and users too, making it easier to maintain customer service as you implement new systems or change existing ones.
You’ll increase your revenue
Successfully improving your staff retention means increasing productivity, reducing hiring costs, and improving your customer service. Together, these factors mean that your business will make more money and lose less of that money to operating costs. Long-tenured staff also tend to build relationships with clients and suppliers over time, meaning business opportunities can be spotted sooner. While working with someone for the first time might require lengthy pitch presentations or requests for information, clients are more likely to request repeat or recurring work if you build a reputation of being reliable – that means retaining your staff and building a long-term relationship with them.