What are the most common reasons employees leave small businesses?

1 Compensation and benefits

One of the most obvious reasons employees leave small businesses is that they are not satisfied with their pay and benefits. Small businesses often struggle to compete with larger companies that can offer higher salaries, bonuses, health insurance, retirement plans, and other perks. If you want to retain your employees, you need to offer them fair and competitive compensation and benefits that reflect their skills, experience, and performance. You can also consider offering non-monetary incentives, such as flexible hours, work-from-home options, recognition, and career development opportunities.

3 Work-life balance

A third reason employees leave small businesses is that they struggle to balance their work and personal lives. Small businesses often have limited staff and resources, which means that employees may have to work long hours, take on multiple roles, or deal with frequent changes and emergencies. This can lead to burnout, fatigue, and resentment. To help your employees achieve a healthy work-life balance, you need to set realistic expectations, prioritize tasks, delegate responsibilities, and respect their boundaries. You also need to encourage your employees to take breaks, use their vacation time, and seek help when they need it.

4 Growth and development

A fourth reason employees leave small businesses is that they do not see any opportunities for growth and development. Employees want to learn new skills, take on new challenges, and advance their careers. If they feel stuck, bored, or underutilized, they are more likely to seek other options. To motivate and retain your employees, you need to offer them opportunities for growth and development. You can do this by providing them with training, coaching, mentoring, feedback, and recognition. You can also create clear career paths, set goals, and reward achievements.

5 Alignment and fit

A fifth reason employees leave small businesses is that they do not align or fit with the vision, mission, and values of the business. Employees want to work for a business that shares their passions, interests, and beliefs. If they feel disconnected, indifferent, or conflicted, they are more likely to lose their enthusiasm and commitment. To ensure alignment and fit, you need to communicate your vision, mission, and values clearly and consistently. You also need to hire, train, and retain employees who share and embody them.

6 Change and uncertainty

A sixth reason employees leave small businesses is that they are not comfortable or prepared for change and uncertainty. Small businesses often face changing market conditions, customer demands, and competitive pressures. This can require employees to adapt, innovate, and cope with ambiguity. If your employees feel overwhelmed, confused, or insecure, they are more likely to quit. To manage change and uncertainty, you need to involve your employees in the decision-making process, communicate the reasons and benefits of the change, provide guidance and support, and solicit feedback and suggestions.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?