How to keep good people: distilling wisdom from 100 years of inquiry on job turnover

Tom Lee

Should I stay or should I go?

Management researchers have been studying this fundamental question, in the context of work, for over a century. In that time they have produced more than 2,000 papers on the topic to help us understand, with increasing clarity, what makes employees remain on the job or look elsewhere.

One of the field’s foremost experts is Tom Lee, the Hughes M. Blake Endowed Professor of Management at the UW Foster School of Business. Below, Lee discusses his field and the findings of two recent papers distilling 100 years of evidence into a modern set of best practices for managing employee retention and turnover.

What are your major contributions to the study of retention and turnover?

I came into the field in the early 1980s, just after landmark studies had first articulated the steps to quitting and the major predictors of turnover. After some years testing these theories like everyone else in the field, I decided it was time to take some risks.

In the mid-1990s, Terry Mitchell (professor emeritus of management) and I introduced the “unfolding model.” In additional to the personality and attitudinal factors that had been studied at length, we found that, in many cases, it took an external event or shock to prompt quitting.

In the 2000s, we began looking at the other side of the turnover equation: why people stay. Most people thought that satisfaction was the most important factor. But we identified several other factors—links, fit and sacrifice—that made leaving just a little bit harder. This became the “job embeddedness” model.

Now we’re working on a new model of “psychological withdrawal states,” which improves the prediction of turnover substantially by considering reluctant leavers and stayers differently from the enthusiastic leavers and stayers that we had traditionally studied.

And really recently, we’ve begun studying turnover indicators over time. By looking the trajectories of job satisfaction, engagement, and embeddedness over time rather than in a single moment, we find that the predictive quality of surveys skyrockets.

Has the study and prediction of turnover become more important?

There has always been a significant cost to losing employees and having to replace them. That cost has risen in the Information Age, when companies make their money on knowledge and innovation.

Today, companies care about retention and turnover not only during economic booms (as was the case when I joined the field), but also during recessions—when they can ill afford to lose their intellectual capital.

Are Millennials a special case when it comes to retention and turnover?

Yes and no. The stereotype of today’s young adults is that they don’t just want a job, they want purpose, fulfillment. They are idealistic. This sounds, to me, a little like the Baby Boomers when they were young.

Whether or not this generation is different, we do know that the relationship between employees and employers has changed. Through the 1970s, there was a strong social norm to stay with a company for an entire career. Today, there is no stigma to changing jobs and employers frequently. In fact, in many industries, there is a stigma to staying put too long.

So, is retention and turnover still worth our attention?

Absolutely. It’s likely that people are going to leave eventually. But if you can keep them on the job for a little longer, motivate them to give a little more, there is real value in that.

Tom’s Tips…

To predict voluntary turnover

  • Measure comprehensively – design surveys that capture job satisfaction (or organizational commitment), job alternatives, active job search, avoidance behaviors (like absences or lateness) and job embeddedness.
  • Track change over time – survey employees more frequently (at least three times a year); look for trends, which can be far more telling than single moments in time.
  • Analyze deeply – let the data drive decisions and policies (though always temper with your best managerial judgment).

To prevent voluntary turnover

  • Foster job embeddedness – build a culture conducive to healthy employee fit, connections and commitment to the organization and community.
  • Know your people – identify enthusiastic leavers and stayers and reluctant leavers and stayers—and manage appropriately.
  • Prepare for shocks — prevent or address events that push an employee to quit, such as supervisory abuse, a job offer or spousal relocation.
  • Understand Millennials – the new generation in the workplace may have a heightened desire to find purpose and personal development.