According to the Bureau of Labour Statistics, around 4.5 million Americans gave up their jobs in January 2023. These numbers indicate that the ‘Great Resignation’ is underway, with individuals across the globe searching for new prospects or making substantial shifts in their professional lives.
According to recent research published in the Harvard Business Review, high employee turnover rates are prevalent in the technology and healthcare industries. Resignations in the IT field alone have increased by 4.5 percent on a year-over-year basis.
Clearly, it is imperative for companies to take decisive steps towards preserving their talented software engineers. What steps can organisations take to create a better work environment for these employees?
What’s the root cause of this widespread resignation?
As per NPR’s Planet Money, it seems that numerous US citizens are quitting their jobs with the intention of enhancing their career prospects. This implies that individuals across various fields are currently enjoying greater opportunities for career advancement.
Undoubtedly, the prolonged pandemic has had an impact on people’s decision to switch careers. Yet, it’s not the only contributing factor. Due to job cuts, forced leave, and individual situations, numerous people have had to re-evaluate their lifestyles and priorities. As a result, burnout and anxiety have become more prevalent, and many individuals have decided to reassess their vocational objectives.
Stack Overflow conducted a recent survey in 2024, which indicated that the percentage of developers who opted to work as freelancers, contractors, or business owners has risen from 9.5% in 2023 to 11.2% in 2024. This trend may suggest that some developers are hesitant to commit to a full-time job.
Essential Retention Strategies for Tech Companies
1. Identify the Core Issue
To deal with the problem of high employee turnover, it’s crucial to identify the root cause(s). The initial step should involve collecting information on how employees perceive working for the company and their professional as well as personal requirements.
Anonymous surveys can prove to be an effective tool for gaining an understanding of your employees’ needs and aspirations. Questions related to topics such as payment and perks, inclusion, working styles, job roles, and the issues they encounter at work can assist you as a leader in comprehending how you can better contribute to their well-being.
Apart from anonymous surveys, you can utilise your own observational abilities as well as those of other leaders within your organisation to obtain a clear understanding of the existing scenario. Are you willing to listen to the suggestions and grievances of your employees? While retention is a problem, to what extent is it prevalent? Is it just isolated to the development team, or is there a broader sense of discontent among other members of the workforce?
2. Harness the Data
To tackle any problem efficiently, analyzing its root causes and compiling pertinent data is imperative. This will allow you to enhance your retention strategies.
While assessing the data you’ve collected from employees, also consider factors like:
- Compensation levels might differ based on developers’ degrees and qualifications.
- Non-monetary benefits and privileges
- Opportunities for skill enhancement and training offered by your company
- Information on the frequency and duration of employee promotions
- Macro trends and changes occurring in the industry as a whole
By analyzing statistics, you can gain deeper insights into which programs and activities are the most effective in retaining employees.
3. Offer High-Quality Resources
Asking software engineers to work with outdated techniques and resources is unreasonable. Providing insufficient tools can hamper their potential and limit their productivity by forcing them to spend more time on tasks that should be easier.
Failing to equip your employees with the necessary resources to carry out their duties might lead to dissatisfaction and a higher likelihood of them seeking work elsewhere.
If your employees express a need for more resources, take note. It may indicate the need for significant changes to the underlying system.
4. Prioritize Your Emotional Wellness as Much as You Can.
A survey found that 81% of developers believe the pandemic has contributed to an increase in burnout.
The problem of burnout has existed in the IT industry even before the onset of the COVID-19 epidemic, causing employees to feel overworked and exhausted. If companies truly value their employees, they must take steps to address this issue.
In order to retain their workforce, business owners should regard their employees’ emotional wellness as a crucial element of their retention plans. This entails not only implementing measures to demonstrate their dedication to their employees’ wellbeing but also examining ways to enhance their work-life balance. This can include options such as remote work and unlimited paid time off (PTO).
5. Elevate Employee Morale
Reports indicate that 75% of engineers are actively seeking or open to exploring new job opportunities. According to a Stack Overflow survey, 65% of those polled cited pay as the primary driving factor for their search. Additionally, 36% sought a more flexible schedule, while 35% desired better job advancement prospects.
These findings suggest that offering employees benefits that promote work-life balance, coupled with opportunities for skills development and career advancement, can lead to higher retention rates. Of course, increasing compensation can also be a viable option.
With the advent of the so-called ‘Great Resignation’ impacting the IT industry, it is critical for organisations to pay attention to their employees’ requests and respond accordingly.
Managers need not wait for their employees to report issues. Instead, they should proactively seek to understand their developers’ career aspirations and work to support them in achieving these goals. This can prove advantageous for both the organisation and its employees, potentially bolstering their commitment and loyalty.