Keeping great people isn’t just an HR challenge anymore, it’s a business priority. High turnover affects productivity, culture, and the bottom line, and the cost of replacing an employee often runs well into the tens of thousands. With competition for talent showing no signs of slowing down, leaders need to understand what really drives retention and how to create environments where people want to stay.
Let's explore seven factors that have the biggest impact on keeping teams engaged and committed.
Retention begins long before an employee’s first day. When someone is hired into a role that genuinely fits their strengths, values, and ambitions, the likelihood of them staying increases significantly. Mis-hires, on the other hand, can lead to frustration for both the employee and the organization.
Using assessments like those from McQuaig helps ensure new hires are a good match not just for the role but for the team and culture they’ll be joining. That kind of alignment pays off in engagement and long-term loyalty.
We all know the saying. People don’t quit companies, they quit managers. While that phrase has been around for years, it continues to hold true. Employees who feel unsupported, undervalued, or misunderstood by their direct manager are far more likely to walk away.
Good managers do more than assign tasks. They coach, listen, and provide feedback in a way that motivates growth. Equipping managers with tools and insights into their team members’ strengths and development needs makes it easier for them to adapt their style and build trust.
Retention thrives in organizations where employees can see a future for themselves. Professional development, whether through training, mentorship, or stretch assignments, signals to employees that the company is invested in their success.
Growth doesn’t always have to mean promotions. It can also mean skill-building, cross-functional projects, or leadership training. What matters is that employees feel they’re learning and advancing, rather than stagnating in their role.
Read More: Build a culture employees don't want to leave
Recognition might seem simple, but it’s often overlooked. Employees who feel their work is seen and valued are more engaged and more likely to stay. Recognition can take many forms: a thank-you in a team meeting, a note from a leader, or a structured rewards program.
The key is authenticity. Generic praise won’t build loyalty, but sincere acknowledgment of contributions and effort can go a long way toward making employees feel respected and motivated.
Burnout is one of the fastest routes to turnover. Employees who consistently feel stretched beyond capacity or who can’t balance personal and professional responsibilities are at higher risk of leaving.
Organizations that respect boundaries, encourage breaks, and offer flexibility where possible see stronger retention. For many employees today, the ability to work remotely at least part of the time or to adjust hours when needed is a major factor in whether they stay.
Employees want to know their work matters. When people feel connected to an organization’s mission and values, they’re more likely to commit long-term. Purpose gives day-to-day tasks meaning and builds a sense of belonging.
Leaders can foster this by consistently communicating how individual roles contribute to larger goals, and by ensuring that values aren’t just words on a wall but principles lived out in everyday decisions.
Read More: Are you a strong leader in a multi-generational workforce?
While money isn’t everything, it still matters. Pay that’s far below market rates or benefits that don’t meet employees’ needs can undo even the strongest culture. Compensation alone won’t guarantee retention, but fair pay paired with the other drivers above creates a compelling reason for employees to stay.
Organizations that review salaries regularly, benchmark against industry standards, and offer meaningful perks like wellness programs or extra time off stand out in a competitive market.
Strong retention isn’t about chasing every new HR trend, it’s about understanding what employees need and consistently delivering on it. When teams are hired with alignment in mind, led by capable managers, given chances to grow, recognized for their work, supported with balance, connected to purpose, and paid fairly, they’re far more likely to stay and thrive.
Retention isn’t solved in one initiative or policy. It’s built through ongoing effort, informed by data and reinforced by culture. Tools like McQuaig’s assessments can help along the way, providing insights into how employees think, what motivates them, and how managers can support them better.
The payoff is worth it: stronger teams, lower turnover costs, and a culture where people want to build their careers.