Human Resources

How to Reduce Turnover in the Manufacturing Industry

Whitney Beasley / November 17, 2023 November 17, 2023

Reducing turnover in the manufacturing industry is a pressing challenge. As skilled workers are joining the “great resignation” movement, organizations need to develop innovative solutions to retain employees and source new candidates who will help their workforce grow in quality and quantity.

As you aim to reduce turnover in your company, it is crucial to understand why employees leave, how you can encourage them to remain in your employment and how you can employ new, skilled workers who will want to grow with the organization. By addressing turnover effectively, you will enhance your business’s competitive edge and cultivate a workforce committed to driving excellence and innovation in their industry.

Factors Influencing Turnover in Manufacturing

Both internal and external factors can influence turnover in the manufacturing industry. In 2020, this industry had a 44.3% turnover rate. This high turnover rate incurs time and monetary overheads due to decreased productivity, potential customer dissatisfaction, hiring and new employee training and knowledge loss when critical personnel leave. Key factors that contribute to staff attrition can include:

• Employee burnout: Working overtime due to a skills shortage can cause employees to burn out, which is especially concerning as manufacturing is a physically demanding job. This physical labor can put employees at an increased risk for injuries.
• Mismanaged expectations: When employees have no clear idea of their roles and responsibilities, they may feel instability in their employment, choosing to leave the company.
• Compensation: A lack of competitive total compensation packages often motivates people to seek other job opportunities that match their financial needs.
• Training and development: Training and development opportunities empower employees to grow their skills.
• Employee appreciation: Employees need workplace recognition, gratitude and respect. These motivations encourage them to remain with the company and share potentially game-changing ideas to streamline manufacturing processes.
• Health concerns: Employee’s emotional, mental and physical health influences their ability to perform at work and their drive to show up and to keep showing up. Organizations with an employee wellness program may see lower staff turnover rates.

Strategies to Reduce Turnover

Reducing turnover in manufacturing requires a multifaceted approach to address organizations’ challenges concerning employment practices in this sector. In an industry that relies on the precision skilled workers offer, retaining experienced employees is paramount to achieving long-term success and efficiency.

Short Term

Part of this retention is investing in employees to foster a sense of loyalty from a happy work environment. This is achievable in the following ways:

• Provide recognition: Recognize hard work, highlight good work and set up a reward system to keep workers engaged with your organization and their career development.
• Connect team members: Engage with employees and involve them by sharing company news and goals, fueling communication from the bottom up.
• Employee feedback: Regular feedback based on employee performance encourages them to discuss their job satisfaction and how they hope to improve their skill. Acting on their input from these sessions puts these improvements into practice and encourages employees to remain with their employer.
• Efficient workstations: Health and safety should be every organization’s top priority. Ergonomic seating, mobile-powered workstations and anti-fatigue floor mats are a few ways in which you can add to employees’ comfort.
• Exit interviews: Workers will inevitably leave for many reasons, some quite out of your control. Exit interviews allow you to gather insights into why the employee is leaving — this information makes it easier for your organization to improve and address specific issues you may have been unaware of.

Long Term

It is essential to invest in your employees. Continuous training and development programs will contribute to your business’s success through more efficient employees. Honing in on the right program may take time, so as you work on this, have one-on-one meetings with team members, cross-train employees with great potential and offer mentorship opportunities to grow more camaraderie in your workforce.

Retention and Growth Ideas for Manufacturing

As you work on how to reduce employee turnover in manufacturing, remember that how you grow your workforce plays an equally critical role. Reducing staff turnover involves a combination of retention and growth strategies that create a workplace that attracts, engages and trains skilled workers. Some ideas that start with the hiring process and extend right into employment, include:

• Optimize sourcing: Place vacancies on reputable job boards that source candidates specific to the role for which you are hiring.
• Cultural fit assessment: Ensure you hire the right people by conducting a cultural fit assessment during the selection process and sharing relevant details about the work environment with candidates.
• Diversity and inclusion: Foster an inclusive and diverse workplace that makes staff feel welcome regardless of their background. A diverse workforce can also lead to a broader range of ideas and perspectives to support your production flow and quality.
• Manage expectations: Be specific about the role the candidate will fill. Detail expectations, responsibilities and necessary skills to ensure applicants know what to expect of them and what they can expect from the position.
• Skills assessment: Cognitive abilities, learning agility, personality traits, situational judgment and multitasking abilities should be part of your pre-hire assessments. These tests will indicate if the candidate is well suited to your hiring role.
• Career growth opportunities and measurement: Career growth can be an indicator of job security. Indicating various ways in which employees can grow within the company and sharing information on progression measurement solidifies these opportunities.
• Scheduling options: Another retention idea for manufacturing companies is to offer flexibility in scheduling. Choosing their schedule encourages employees to come on board and remain with their employer.
• Thorough onboarding and training: Comprehensive onboarding reassures employees about their role and security at work while contributing to expectation management efforts.
• Incentive programs: Profit-sharing and production bonuses are just two types of incentive programs that keep staff engaged and motivated to meet or even exceed performance targets.

Put These Strategies Into Practice With Exude Human Capital

High employee turnover disrupts operational continuity in manufacturing and incurs significant overheads due to new recruitment processes, lost productivity and training processes, which take time. Understanding these contributing factors and taking proactive steps to mitigate them can help your organization reduce voluntary attrition to create a more productive and stable workforce. It’s important to have Human Resource departments partner with the leaders and employees to make people feel supported and valued. This may require outsourcing parts of your HR team for strategic initiatives or extra support.

Exude can provide assistance in human resources consulting, HR outsourcing and implementing your strategies for employee retention in the manufacturing industry. For more information, fill out our online form or call us today at 610-403-9909.