Employee Retention Through Career Development

Topic: HR Management
Words: 1014 Pages: 7

Employee turnover has a much more significant impact than it might seem. When talented employees leave a job, they are more likely to join a competitor. Thus, the company loses a good employee and its intangible assets simultaneously – turnover costs can include losing customers, partners, and workplace morale (Rakhra, 2018). In addition, there is a significant investment of time spent searching, referencing, verifying, interviewing, hiring, and finally training a new employee only to get back to where the company started. Therefore, businesses develop specific policies to support current staff in staying with the company, commonly referred to as retention (Kaur, 2017). Retention, organized and communicated transparently and straightforwardly, can prevent many misunderstandings in the workplace. Retention includes implementation of various strategies, such as motivating leadership, personal and professional development opportunities, performance appraisal, and proper compensation. The main goal behind these strategies is to improve employee career development as one of the main reasons for employees to stay.

Retention Strategies

A balanced and fair attitude towards employees directly impacts their desire to stay with the company. Hence, when dealing with people, leaders must question their views, preferences, and assumptions (Kamalaveni et al., 2019). Employee development programs cannot exist without a support from people in top management positions; these people must also serve as positive examples for subordinates. In this context, responsible leadership has three components: support for ethical and social norms of behavior; maintaining fair and inclusive HR practices; fully supporting employee development (Singh, 2019). A positive effect occurs when the employee is given a leadership role through delegation of tasks and independence (Khalid & Nawab, 2018). Therefore, the manager’s attitude directly affects the employees’ commitment to the organization, as their sense of belonging to the company becomes very strong.

Development Opportunities

An important retention factor is a personal and professional growth; promotional opportunities have a significant impact on the feeling of development. They refer to the transparency of the institution’s policies and career opportunities for employees within the institution (Kamalaveni et al., 2019). Promoting employees makes them feel loyal and satisfied and reduce their intention to leave the company; that is why they repay the institution with their dedication, devotion, and engagement (Bibi et al., 2017). In addition, the goal of career planning as part of an employee development program is not solely limited to employees feeling that the company is investing in them (Kaur, 2017). It also helps people control various aspects of their lives and cope with the fact that a path to promotion may not be as clear as they would want.


As mentioned earlier, professional growth is a significant driver of employee retention; another way to obtain it is through training. Investing money in staff training is not an expense—it adds strategic intangible value. Accessibility to training and development programs for all employees is critical to promoting organizational growth, especially with productivity and technology improvements (Kaur, 2017). However, the increase in employee productivity through training must be rewarded according to market value to avoid possible turnover (Rombaut & Guerry, 2020). Work-related learning improves employees’ problem-solving ability by making them confident, motivated, and committed to their current career development, leading to higher retention rates.

Performance Appraisal

Performance appraisal is as a communicational link between management and employees. According to Singh (2019), it can be defined as evaluation of individual performance in the overall contribution of the organization. An effective appraisal will result in a satisfied, motivated, and dedicated employee. Not only does it help companies keep an eye on their employees, but it also helps individuals improve their performance by being aware of their strengths and weaknesses (Singh, 2019). Both employer and employee benefit from performance appraisals since it determines the performance gap between the established standard and the actual state (Ramapriya & Sudhamathi, 2020). Performance appraisal enables an increase in both monetary and non-monetary benefits such as bonuses, management support, individual recognition, career development, and other important factors influencing an employee’s decision to stay or leave an organization.


Compensation is considered one of the main elements of employee retention. It can be defined as something (typically money in various forms) that an employee receives from an employer (Singh, 2019). In many ways, compensation is a key feature that affects employee retention and engagement. If employees — of any rank — are satisfied with their pay and benefits, they are motivated to work productively (Kaur, 2017). Similarly, when organizations do not provide sufficient compensation, employees may decide to leave (Bibi et al., 2017). Many organizations claim to boost pay based on team performance, but often continue to reward people predominantly for individual achievements (Kaur, 2017). These inconsistencies can lead to frustration and cynicism on the part of employees (Rombaut & Guerry, 2020). Thus, for employees to remain committed to the organization, pay must be competitive and aligned with other employees.

For an HR manager, administering the compensation strategy should be of first priority due to several reasons. Although its relationship to employee career development might seem vague in many cases, compensation is intertwined with every strategy mentioned so far. Leaders may use rewards as a form of communication and appreciation. Pay received at the chosen job position contributes to self-esteem; it also provides a measure of professional success. Finally, compensation belongs to the most common practices of employee performance appraisal. In other words, such a deep level of connection stresses the importance of compensation strategy for career development in particular and employee retention as a whole.


Career development is among the most influential factors that impact employee retention; to provide it, companies implement different strategies, such as leadership, development opportunities, and performance appraisal, reinforcing them with rewards. A proper company manager’s attitude toward employees positively impacts their desire to advance their career. The feeling of personal and professional growth directly impacts the employee’s career development. In addition, if their performance in the company is appreciated and rewarded accordingly, employees will be more motivated to pursue their careers at the chosen workplace. Rewarding the employees’ effort has the broadest impact; thus, it should have the highest manager priority.


Bibi, P., Pangil, F., Johari, J., & Ahmad, A. (2017). The impact of compensation and promotional opportunities on employee retention in academic institutions: The moderating role of work environment. Journal of Economic & Management Perspectives, 11(1), 378-391.

Kamalaveni, M., Ramesh, S., & Vetrivel, T. (2019). A review of literature on employee retention. International Journal of Innovative Research in Management Studies, 4(4), 1-10.

Khalid, K., & Nawab, S. (2018). Employee participation and employee retention in view of compensation. SAGE Open, 8(4).

Kaur, R. (2017). Employee retention models and factors affecting employees retention in IT companies. International Journal of Business Administration and Management, 7(1), 161-174.

Rakhra, H. K. (2018). Study on factors influencing employee retention in companies. International journal of public sector performance management, 4(1), 57-79.

Ramapriya, M., & Sudhamathi, S. (2020). Theory of employee retention strategies. Journal of Interdisciplinary Cycle Research, 12(2), 1112-1119.

Rombaut, E., & Guerry, M. A. (2020). The effectiveness of employee retention through an uplift modeling approach. International Journal of Manpower, 41(8), 1199-1220.

Singh, D. (2019). A literature review on employee retention with focus on recent trends. International Journal of Scientific Research in Science and Technology, 6(1), 425-431.

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