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Employee Engagement and Retention – Are They Connected?

April 19, 2022

The Great Resignation

Employee engagement and retention are frequently associated with each other. Why? They are equally important, and more importantly, connected. 

During The Great Resignation, businesses have began to take an in-depth look at their engagement, retention, and recruitment strategies. Most companies found that while company culture directly impacts recruitment, employee engagement directly impacts retention.

Companies should focus on driving performance and retention through employee engagement. There are many employee retention challenges. But it’s possible to overcome them with employee engagement and retention strategies. 

However, learning how engagement and retention affect each other could help organisations find long-term solutions for decreasing turnover and building improved company cultures.


Why Does Employee Retention Matter?

The bottom line is that poor employee retention is an expensive problem for any business.

Do you know the cost of high turnover? It includes lost profitability, lost productivity, higher budgets for recruitment, the loss of quality candidates, training and so much more.

This can cause a domino effect for companies to allocate resources to those issues instead of providing raises, bonuses, etc. Additionally, high turnover affects engagement, company culture, and the employee experience. 

Improved Employee Experience 

The employee experience includes each stage of the employee life cycle from recruitment to retirement. With retention strategies in place, companies can focus on improving the employee experience in a meaningful way.

More Experienced Employees 

With high turnover, the likelihood of having experienced employees who understand the business and champion its mission is low.

Therefore, those who stay gain more experience and grow. These employees are invaluable and contribute more to the bottom line. 

Stronger Work Relationships 

Employees who spend a lot of time together are more likely to collaborate better, support each other, and build strong relationships.

Engagement increases when you have teams who care about each other’s successes. This also helps to build a strong, fun, and collaborative company culture.

Happy Workers

Increased Profitability and Time

Businesses save time and money by not consistently onboarding and offboarding employees.

Moreover, when employees are invested in their work and company, they’re more likely to work harder for the company (and stay). This leads to higher profitability and increased employee engagement.


What Impacts Employee Engagement and Retention?

So, why does employee engagement impact retention? 

Employees who are engaged are more likely to stay with their organisation rather than search for a different job opportunity. Those who feel engaged act as champions of the company.

They typically have a stronger connection with the company’s mission, goals, and colleagues. Highly engaged employees help to drive performance as well as become advocates for recruitment. 

Actively disengaged employees often have negative emotions associated with the organisation and/or their work. However, disengaged employees should be considered a great opportunity for improvement.

With the proper retention and engagement strategies, you can turn them into engaged and satisfied employees. 

RELATED CONTENT: Spotting the 8 Signs of Employee Financial Stress

Who Drives Employee Retention Strategies? 

It is not just an HR (Human Resource) issue. Employee retention strategies should be solved together including HR, managers, team leads, and yes, C-suite executives.

This is really a team effort! 

Employee engagement with different departments discussing retention

Everyone in the organisation impacts employee engagement and retention. HR is primarily responsible for the policies that help create a safe, positive, and fun workplace.

Managers are responsible for supporting and motivating employees. And C-suite executives make decisions that directly impact the employee experience. 

Do colleagues drive employee retention strategies? They can!

Colleagues can influence the workplace and other employees’ feelings. It’s important to consider the interpersonal relationships within the company. How do team members impact retention? Well, consider the following scenarios:

  • An employee’s work best friend is preparing to leave,
  • A disgruntled employee makes the workplace difficult,
  • Someone actively disrupts the company culture, or
  • The consensus of negative emotions within a group. (Could this be mutiny? Maybe.) 

Just remember the burden of employee retention does not fall on one person’s shoulders. There are different drivers for employee engagement and retention. And everyone plays a role. 


Employee Retention Challenges 

Over 47% of Human Resource professionals believed that employee retention and turnover was the top workplace management challenge. Retention has its unique challenges that all companies must overcome. 

It’s important for companies to look at the bigger picture. Do you offer balanced salary packages? Are the benefits really beneficial? Is our company culture engaging? How can we provide a fun, safe workplace?

Typically, the recruitment process has been “what can this candidate offer us?” Whereas now, potential candidates (and current employees) are asking, “what can this company offer me?” Therefore, companies need to be addressing areas of employee engagement and retention. Companies are competing in numerous different areas:

  • Workplace environment.
  • Support.
  • Employee satisfaction.
  • Remote work.
  • Salary packages.
  • Company culture.
  • Professional growth.
  • Exceptional employee benefits
  • Workplace relationships, and 
  • Recognition and Rewards (of course).

If the needs of these areas are not met, employees are more likely to look elsewhere for jobs. In addition to the challenges that can be monetarily solved, employers need to look at the impacts of the economy and the stress that employees face.  

Burnout and Stress Effects

Over 43% of CEOs noted employee retention was a “significant concern.”

Employee engagement decreases due to signs of stress in employees

Furthermore, CEOs reported elevated levels of stress in their employees.

Regardless of its origin, stress is a leading cause of high turnover. This can be caused by burnout, overwhelming workloads, poor communication, and a lack of company insight. 

Economy Implications

Although it is an overlooked barrier, the economy puts a lot of pressure on businesses. It can ultimately affect employee engagement and retention.

The economy is a volatile factor in employee retention. Talent availability, the rising cost of supplies, and inflation can influence business planning more than we know.

With increased costs and lack of available talent, employers could withhold annual raises, decrease fun engagement events, minimise benefits and rewards, and even forego annual bonuses.


How to Make Employee Retention and Engagement Successful

If you fail to plan, you plan to fail.

Successful employee retention and engagement require adequate groundwork. In order to determine if your company is facing employee engagement and retention issues, research needs to be done.

Businesses need to understand why employees leave in the first place. Once you know the extent of your engagement and retention problem, your company can execute ways to solve it.

  • Research. Turnover analysis can be done through benchmarking (External and internal), pulse surveys, attending trade shows , webinars & performing competitor analysis. 
  • Create an action plan. After conducting research, it’s time to make a plan that will improve your retention. The use of board strategies (company culture, salaries, etc.) and targeted strategies (exit interviews, stay interviews, and focus groups). 
  • Implementation. You’re not done yet! You’ve laid the groundwork, now it’s time to execute strategies that were identified by your company.
  • Evaluate results. After implementing your plan, you should be evaluating (quarterly or annually) the results to assess the impact your strategies are having.

Employees planning for employee engagement and retention strategies


Basic Tips to Improve Employee Retention and Engagement 

While you won’t see dramatic improvement overnight, it’s important to be consistent. Trust us, you will see the results eventually. Building a healthy company culture takes time. At the very least, be mindful of best practices that focus on the “human” aspect. 

  • Keep policies and strategies simple. 
  • Be genuine. 
  • Offer consistent support.
  • Encourage communication. 
  • Value relationships. 
  • Foster ideas and innovation. 
  • Provide opportunities for growth. 
  • Give employees recognition!

Employee Engagement and Retention Strategies

Improving both employee engagement and employee retention will require consistent effort within the organisation. There are multiple ways for companies to formulate strategies on how to improve retention and engagement.

New employee shaking hands

Great Onboarding Experience

In a report from Gallup, only 12% of employees believe their company successfully onboarded new team members. That means 88% of new hires are not being set up for initial success. By creating a comprehensive onboarding program, you can provide new employees with the tools and knowledge necessary to transition comfortably. 

Your onboarding team should comprise employees from different departments including HR, relevant teams, direct stakeholders, and C-suite members (yes, even the CEO). By doing so, you are creating an environment that allows open communication to be foundational. 

Additionally, you can identify goals and measure success during onboarding. Stick with the main Cs: compliance, clarification, culture, and connection. This way your new employees are prepared for everything! 

PRO TIP: And if you really want an great onboarding experience, provide new employees with fun (and personable) items like backpacks, travel mugs, their favourite sweets, and company swag! 

Recruiting Quality Candidates 

Finding exceptionally qualified candidates is like striking gold. But find quality candidates that align with your company culture and will stay for long? That’s a unicorn. And every recruiter’s dream. 

Businesses should focus on finding the “unicorn.” Candidates are expected to sell themselves during the recruitment process, but they are also looking to be sold to the company. Now more than ever, employees value transparency, company culture, fringe benefits, and a superb work-life balance (especially millennials).

Don’t be surprised if candidates ask about your company culture.

It’s important to keep in mind that your best employee may have a unique educational experience. Maybe, it’s not traditional, or maybe they didn’t attend a Russel Group or Oxbridge uni. Be open to diverse paths and backgrounds among candidates. And look for those who align best with your company culture, mission, and goals.

Build Better Work Relationships 

It starts from the top down. And it requires communication. 

Relationship building can feel tricky! But it is vital to the success of any company’s employee engagement and retention strategy. Get to know your employees and encourage managers to have a relationship with their employees as well. This can be done with team-building exercises, 1:1 meetings, and team meetings. 

Just remember, work relationships need to be more than just work. Show a genuine interest in who your employees are, their personal lives, and hobbies. This helps not only establish a healthy line of communication but reinforces bonds. 

Implementing a social recognition programme can also help to strengthen the relationships between employees, colleagues, and leaders. This type of program encourages everyone to interact with each other regardless of status, tenure, or position. Whether it’s a work anniversary, or a shout out for a job well done, you can empower employees to experience moments that are bonding. 

RELATED CONTENT: What is Social Recognition?

Man and woman high-fiving at work


Employee Recognition 

It feels great to be recognized for your achievements. 

Employees who are recognised for their demanding work, milestones, and achievements are more likely to be engaged and stay at that company. Everyone deserves to feel valued & appreciated for their efforts in a meaningful way.

By implementing recognition programmes and other strategies, you can greatly improve engagement and retention. People will stay where they feel valued. Engaged employees will feel empowered to help build a positive company culture, reach, and obtain company goals, and grow professionally.


Focus on Engagement 

Engagement and retention go together. Those who are engaged are not likely to leave. Your strategy for employee engagement is important. It directly impacts retention. Here’s a few ways to focus on employee engagement:

  • Empower your employees. Trust your employees to use their judgment for projects and tasks and give them the opportunity to do more when they ask for it. 
  • Encourage communication. Employees need to feel as if they can talk openly with their leaders, managers, and colleagues.
  • Prioritise work and life balance. Your employees should have a life outside of work, and you should be respectful of that as well. This will help prevent burnout. 

Professional Development Opportunities 

Employees will not stay where they feel stagnant. 

Neglecting employee development can have significant effects on a company’s ROI. Supporting your employees’ career aspirations, professional development, and continued education can improve morale, and boost engagement and retention. 

Not every company needs to have a formal professional development program, but it does make it easier to execute ideas! However, mentor programs and other educational programs inspire employees to be more creative, engaged, and motivated. 

Companies can support their employees’ growth by implementing reimbursement for continuing education and certification programmes, including conferences, industry-related memberships, and events.

PRO TIP: Take it a step further. Implement internal knowledge shares. Allow your employees to share their expertise and teach others new skills (this is a cost-effective idea). 

Company Culture Matters 

Positive company culture has an enormous impact on attracting and retaining employees. Many employees think that the fringe benefits and perks are what make a culture awesome. However, company culture is much more complex than sleep pods, snacks, and a ping-pong table. 

Your company culture should represent the core values of the business. The workplace environment can become very toxic quickly. But with core values being its foundation, your company culture can grow and flourish.

Employees should feel as if they can ask questions, seek support from managers, build relationships with colleagues and grow professionally. When building a company culture, ensure its success by encouraging open communication, offering professional development, and great compensation packages.

Some ideas to build a fun and thriving company culture include: 

  • Team building exercises.
  • Collaborative environments.
  • Wellness initiatives.
  • Professional development opportunities.
  • Company events.
  • Rewards & Recognition.
  • Employer-provided benefits.
  • Open communication.


Employee engagement and retention requires a lot of consistent effort. Despite its challenges, companies can greatly improve their retention and engagement with a simple plan and strategies.  

Finding an extraordinary employee is like finding a golden ticket. Let’s work together to engage and retain your top talent with an awesome recognition programme. If you’re ready to achieve more, contact us today. 

UK 360 Recognition