The Key to Retaining Your Employees Is Right Under Your Nose Retention will be the name of the game in 2023 — and the best way to ensure that employees stick around is to invest in initiatives that facilitate fulfilling work experiences.

The year started off with HR continuing to make headlines, as news of massive layoffs within tech and other industries have dominated headlines and discussions about the incredible capabilities of predictive AI — like those displayed by ChatGPT — have complicated the hiring process. It might seem that, after years of record-low unemployment and rapid hiring pushes, 2023 will usher in a new era for managers and employees alike; one that may again favor employers' interests, juxtaposed by a strong desire for employees to feel a sense of purpose and belonging at work.

While candidates will likely have less leverage going into negotiations than they did at the height of the Great Resignation, the power balance in the workforce may not shift as significantly as one might think. Unemployment is still incredibly low and there are still roles sitting unfilled at businesses around the country. News of layoffs elsewhere may even send employees who feel undervalued or at risk in their current roles to seek new opportunities to get ahead of an unforeseen loss of income.

That's bad news for employers looking to cut costs. In general, the reality is that retaining workers costs less than hiring new employees, even if it means paying tenured employees more or working with them to better address needs or concerns. This has always been the case as onboarding and training takes time and effort, slowing productivity until the new employee gets up to speed. However, it's even more important in today's labor market, where workers are regularly seeing their compensation increase by almost 10% when they change jobs.

Retention will be the name of the game in 2023 — and the best way to ensure that employees stick around is to invest in initiatives like these that facilitate fulfilling work experiences.

Related: Employee Experience Matters More Than Ever. Here's How to Elevate It.

Pursue cost savings that don't come at employees' expense

As belts tighten across industries, companies are pursuing cost-savings at every level. Foregoing raises, cutting benefits, reducing bonuses and other measures often rise to the top of the list when budgets need a facelift. It makes some sense; employee compensation is a huge expense — and with news that open positions are few and far between splashed across the front page of papers — cutting back on perks can seem like a no-brainer.

However, doing so can be detrimental to employee longevity. A 2022 Paychex survey showed that health insurance (64%) and retirement plans (62%) are the top two benefits that contribute to people's decision to stay in their roles. Maintaining these benefits illustrates that leadership sees employees as people, not line items, and understands that AI tools may increase efficiency, but can't replace a human touch. To avoid driving loyal workers to pursue other opportunities, leaders need to find alternative ways to keep costs down. Engaging with consultants, investing in technologies that make operations more efficient and identifying federal or local business incentive programs can all help organizations achieve their financial goals without sacrificing employees' needs.

Develop talent from within

So much of an employee's experience at work stems from whether they feel valued by their managers. One way leaders can show employees they're valued is by offering them chances to grow and learn within their existing roles — and it doesn't have to be through classes or training programs. The simple act of challenging team members with new projects or responsibilities can show your investment in employees' futures. Even better, these pursuits make it easier to build a strong leadership pipeline that meets the future needs of the business.

Lean into flexibility

Employees expect more flexibility from their employers than ever before. The merits of in-office policies have been discussed at length in the wake of the pandemic's initial waves, but it bears repeating. Companies that recognize this and work with employees to design schedules and work-from-home policies that align with employee needs will be better positioned to hold on to talented workers. Those that don't pursue this balance may risk losing team members to more flexible organizations.

Related: Take Advantage of This Easy and Effective Way to Improve Employee Experience

Emphasize meaningful connections

Employers looking to foster connections among staff may want to create opportunities for employees to connect about projects — or non-work-related topics — in real time. For companies that are operating in person, this could mean offering employee recognition events, company-wide meetings or lunches. Those with remote workforces may consider offering virtual discussions during which employees can connect to learn about industry-related topics or chat about movies or books.

Regardless of the path you take, offering employees a chance to take a "break" from the grind and share ideas can help make offices a place where employees can build their network, learn new things and take a break from their video meetings.

Focus on technology

Investing in technology that makes workers' lives easier can make all the difference in employee experiences. Across industries, streamlined platforms, automation tools, and advancements in equipment are only becoming more accessible and helpful. While integrating new software or hardware into your organization may come with an initial expense, the improved processes and reduced employee workloads can yield a significant return in the form of happier employees, more connected teams and more productive workers.

Related: Employee Experience Is Changing. Are You Changing With It?

Curate a values-based company culture

Most leaders understand that focusing on a set of values is important in today's business landscape, but just stating those values isn't enough to create meaning for employees. Companies must also let those values guide their policies and procedures. Investing in community-building efforts and corporate policies that reflect your stated values will show employees your dedication to practicing what you preach and help them feel more connected to the company's overall mission. The most successful leaders naturally lead the way by demonstrating a strong commitment to company values.

Workers have become accustomed to certain benefits and policies over the past few years — and they may be willing to look at other organizations to secure those benefits. It's unlikely that general economic uncertainty will lead them to settle for less. The key for employers in 2023 will be continuing to improve employee experiences despite those economic concerns, so employees choose to stick around rather than seek opportunities elsewhere. Those that deliver could find their companies more resilient and productive in the coming months, whatever challenges they might face next.