7 Strategies to Reduce Employee Turnover in 2026

Unsatisfied employees will most likely want to leave. Sometimes, even the most loyal members of your staff that have stretched it with you for many years will, one day, decide to end things. To build a resilient team, the goal therefore, is to assemble and retaining the best talents or resource pool for the long haul, mitigating the impact of employee turnover, and improving your employee retention practices.

In 2025 alone, high employee churn caused massive financial and operational costs, ranging from 50% to 200% of a departing employee's salary, including direct expenses (recruitment, training) and hidden costs (lost productivity, damaged morale, knowledge gaps, missed sales, decreased customer satisfaction). It significantly impacts profitability, harms company culture, increases safety risks (especially in industries like construction), and can cost businesses hundreds of thousands or even millions annually, with much of it preventable through better leadership and flexibility.

Employees are indeed assets to their organizations, and great employees are the best resources any company can boast of. In this article, we'll take you through 7 practical strategies for reducing employee turnover in your company and redirect your energy and resources on actual business goals.

Best 7 Strategies to Reduce Employee Turnover in 2026

1. Hire the Right Talent

You probably know this already, but are not yet aware of how it impacts your business. Hiring the right person for the job is not a spur-of-the-moment decision, and neither is it rocket science. It takes proper planning, which includes a thorough evaluation of your talent needs and identifying the skills gap in your organization.

Next is establising a selection process that produces the right candidates. In situations where culture fit is a matter dear to you, you want to create time to ensure that potential employees are not misfits. They may be qualified enough for the job description, but if their philosophies and attitude to work do not align with your organization's goals and work ethics, it could be a costly mistake to bring in them on.

2. Provide Opportunities for Growth

Many SMBs still do not realize the importance of helping employees grow. Most professionals these days aren't just looking for the fattest paycheck; many are more interested in work opportunities that they can leverage to grow than in the size of the paycheck. Indeed, the size of the paycheck matters a great deal, but staying competitive today in the industry requires more than that; companies need to integrate continuous learning, training, internal mobility, and development opportunities into regular work schedules.

It is even better if these opportunities are tailored to bridge skills gaps and meet professional standards on the job. Employees may leave after, but they're less likely to do so if they're gainfully engaged. Responsible employees will always give back to companies that help them grow.

3. Maximizing Employee Engagement on the Job

Lack of optimal employee engagement is another major reason you may experience an increasing employee turnover rate among your workforce. One way to know that your workforce is underutilized is reduced productivity and poor employee satisfaction. Burnout contributes immensely to disengagement, but so does underutilization. Active and fulfilling work keeps professionals engaged and productive, leading to high employee satisfaction.

Oftentimes, low engagement reduces morale among the workforce, causing people to quit. The best way to address this challenge is by creating a system that encourages maximum participation and utilization of talent. Note that this is not the same as overworking your workforce. Laying too much on their desk will likely put too much pressure on employees. If more work must be done, it is best to bring in more resources to handle them, or, better still, outsource part of the workload to ad-hoc staff if you can’t afford full-time employees.

4. Flexible Working Arrangements and Quality Work-Life Balance

If you're currently suffering from high employee churn, one area you must evaluate is employee work-life balance. Today, we live in a completely different time. Companies with a solid remote work policy have already caught on the drift, making relevant adjustments to accommodate new employee preferences.

For instance, more and more employees have emphasized their preference for remote or hybrid work against in-office work arrangements, even after the pandemic. Having been reinforced into increased adoption by a significant proportion of the American workforce due to the pandemic, remote work has come to stay for good.

The benefits include better work-life balance and reduced expenditure on commuting for employees, and reduced operational costs for employers. Many parents are now a bit more involved in their kids' affairs and other domestic engagements while still producing great work.

5. Adequate Allocation of Resources to Teams

The chances of turnover are high when HR fails to allocate resources in the right direction. Employees are likely to do their best work when they feel that their competencies are deployed in the right direction. But when resource allocation is poorly done, it can either make employees feel underutilized or overworked.

To achieve appropriate resource allocation across the company, employers will need to use intuitive feedback tools along with regular workforce analytics that reveals key areas of resource needs. Over time, resource allocation will improve, and your bottom line will be the better for it.

6. Identify and Reward Great Performers

Studies show that rewarding great talent increases the morale of your workforce. Bearing in mind that great work is appreciated and celebrated, most employees will be motivated to put in their best, a culture that ultimately reflects in the productivity of the workforce at large.

Awarding promotions as and when due is also a great employee retention strategy. It assures employees that their efforts are recognized by management and inspires them to greater productivity.

7. Offer Competitive Employee Benefits Packages

Last, but not least on the list, is employee benefits package. Employee benefits plan is always a hot topic; starting from health insurance to on-the-job perks and entitlements to more advanced packages like employer-matched 401(k), employers will need to up their game to reduce the chances of high turnovers. Honestly, no one will be motivated to give their best in an environment where they're under-compensated.

Many SMBs still consider this to be a challenge, but a quick solution can be as simple as entering a co-employment partnership with a professional employer organization (PEO), a solution that helps many small businesses compete head-to-head with large corporations and multinationals in offering the best benefits packages.

Build a Future-proof Workforce Today

From our experience dealing with lots of small and mid-sized business owners, we've discovered that high employee turnover is, for the majority of times, an indication of weak retention strategies, or the outright absence of one in the first place. Yes, many factors go into retaining resourceful employees, but a good number of those factors lie within the control of employers.

As a leading partner in the PEO, HR, payroll, and benefits outsourcing marketplace, we are positioned to help you reduce employee turnover and develop a robust employee retention programme. We’re happy to walk you through every step to creating a strong employee retention plan for your company.

We provide result-oriented services for small and medium-sized organizations and government contractors, serving as a trusted partner in integrated human resource compliance, risk management, employee benefits, employment practices liability insurance (EPLI), and payroll processing. You can contact us today at The Mission to schedule a consultation.