First, the bad news.
LinkedIn discovered that the tech turnover rate is the highest of any industry, at over 13.2%.
The highest of any industry. And we’ve seen it much worse in specific technology hubs.
As a technology company that’s just as passionate about our people as we are about using technology to enhance our community, culture, and lives, that number doesn’t sit right with us.
So, why? Why are so many people leaving their tech jobs at this alarming rate? Well, here’s the short answer:
Why is the tech turnover rate so high?
In this industry, many employees jump from company to company to gain experience. They need that experience to propel them forward in their career so they can land a top job at a large tech company.
Sounds like it’s out of our control, right? Not quite!
Because of this, many of the rest of us “non-giant” tech companies have unfortunately made the tech turnover problem much worse. By subconsciously assuming all our talent will leave as quickly as they can for the next opportunity, tech companies have stopped prioritizing their people, therefore allowing their work environments to become hypercritical and stagnant.
This, in turn, motivates employees to advance their careers elsewhere.
It’s a bad cycle. But here’s the good news:
We lowered our turnover rate and kept our team members engaged. You can, too:
Our solution is actually a very straightforward one — culture. Technology companies that create a strong, positive culture for their employees see a dramatic decrease in their turnover rate.
If you stop and think about why your employees want to snag top tech jobs with industry giants like Google and Facebook, it very often boils down to the quality of life that they’re pursuing. They’re looking for a work environment that gives them purpose, challenges them, pushes them to grow, and allows them to advance, all while providing substantial enough financial rewards for them to make a good living for themselves and their families.
So, if you can offer your employees the same quality of life they would find elsewhere, or even a better one, many may rethink the decision to leave.
For over seven years, our focus has been on investing in the kind of company culture that beats the tech turnover rate, and we want you to benefit from our years of learning. Here are the five key investments we recommend for creating a strong culture for your company.
#1: Invest in your people
To be honest, we feel like we had to start this blog post backwards. Lowering the tech turnover rate is incredibly important for employers, but here’s what we’ve discovered about creating a strong culture:
“Seeing results for yourself cannot be the primary motivation of creating a strong culture for your employees. Otherwise, it won’t be authentic.”
It’s a paradox! If you want your tech company to buck the tech turnover rate by creating a strong culture, you have to create a strong culture out of genuine care for your employees rather than the motivation to lower your turnover rate. Yes, we can personally attest that a lower turnover rate is a byproduct of a strong culture, but it’s too shortsighted to be its purpose.
The first investment you need to make to create a strong culture for your tech company is in genuinely caring for the people that come and go through your doors, no matter how long they stay with you. Invest your time, energy, and heart in knowing and caring about the people you employ. Be passionate about seeing them grow and concerned about what they’re going through. Be interested in their motivations, work amiably with their personalities, and put their unique skills to use.
#2: Invest in your vision
Every tech company has a vision statement. However, we’ve discovered that most companies fail to successfully implement their vision and values throughout the workforce. Anyone can create a vision, but what are you doing to actually live it out?
We urge your leadership team to write a strong culture statement for your company. Be specific about the environment you want to create in your business, the priorities you and your team must have, and the actions that embody your company values. Then, once it’s written, go over it with your team. Create activities that allow them to internalize the purpose behind your culture statement, and gently call them out when you see behaviors that don’t align with your company values — especially in members of your leadership team. Purpose is an important part of why people want to work for your company, or why they’ll stay. So remind them often.
#3: Invest in their livelihood
It’s common practice to look at what other companies in your area are paying for their talent and copy their salaries. But Donny, our Vice President, made a commitment to refuse to settle for only paying Steele Consulting employees the standard amounts for the area. As Donny puts it,
“I want to pay my team based on worth, not standard. That’s why we regularly pour the resources we make into our most important asset: our team.”
And believe us, we’re not naive when it comes to the cost of paying high salaries. After all, your company can’t afford to pay anyone well if you can’t afford to pay anyone at all. But the reality is, companies that financially invest their growing resources back into the livelihoods of their employees see better results than companies who don’t.
Why? Well, not only are you investing in your most critical asset, you’re answering your employees’ unspoken question, “Does this company actually care about me?” Yes, your company actually does.
#4: Invest in their lives
We can sum up this section in one word — empathy. When you can authentically empathize with your employees, you demonstrate how you see them as the valuable human beings that they are, not just cogs in your system. Managers and leaders that cannot effectively connect with their employees are a major factor contributing to the high tech turnover rate.
Empathizing with your team starts with intentionally building a trust-based relationship with them. It also means knowing them well enough to watch for the warning signs of burnout, external pressure, and discouragement.
#5: Invest in their growth
If your team feels a sense of ownership in the work that they do, they will work harder and better to see the company’s vision accomplished. Everyone (with very few exceptions) is searching for the ability to work hard at work worth doing.
We not only hold our team to high standards, we provide them with the coaching, training, and development they need in order to meet — and exceed — those standards. Invest in your team’s growth by setting high goals and giving them resources. Partner alongside them to learn where they want to go, how they want to grow, and what their ambitions are.
Here at Steele Consulting, we’re incredibly passionate about empowering technology companies to combat issues like the tech turnover rate through the creation of a strong company culture. If you have questions, concerns, or are looking for guidance in this area, please don’t hesitate to contact us. We can (and love to) talk about this all day long!