How to Reduce Employee Attrition by 25%

What if I told you that there is one thing you can do at work that will make employees less likely to leave, create a more agile workforce, increase employee engagement, support the creation of a robust succession plan, increase trust, attract better talent, drive engagement, and improve employee satisfaction?

Just one thing.

You would probably conclude that this one thing must be vitally important to employees if it positively impacts so many different areas—and you are correct.

So, what is so important to employees that if they don’t get it, they quit their jobs to find it elsewhere? Indeed, it is the #1 reason why employees leave their jobs.

Before I answer that question, let’s briefly examine the history of the employer-employee dynamic. No worries, this won’t be a boring repetition of what they teach in Economics 101. At the same time, it is worth briefly reviewing, as it offers an important backdrop that helps us better understand the significance of what you are about to read.

Understanding the employer-employee dynamic: A brief history

We are all familiar with the concept of trading time for money. This model was introduced on a large scale hundreds of years ago, at the beginning of the Industrial Revolution. Employees went to work under harsh conditions in environments that offered little employment security to earn money so that they could put food on the table to feed their families. It was a straightforward and effective exchange for the time.

While work conditions are safer today and job security has somewhat improved, overall, this critical relationship between employers and employees hasn't changed much and is still deeply grounded in the concept of trading time for money that dates back to 1760, the beginning of the Industrial Revolution. Nevertheless, this outdated model is still today’s default.

The evolution of employee expectations

Can you think of anything else that we still use today that is over 250 years old and hasn’t changed much since? Are your employees still coming to work in horse carriages or on horseback? Are your employees still writing their correspondence with feather and ink? Clearly, these are rhetorical questions but questions we might need to ask to encourage us to take a closer look at some of the fundamental aspects of the employer-employee relationship that need to be reviewed or even updated for the 21st century.

Everything in our lives has changed, including employee expectations. Today’s employees expect more than just money, which accounts for only 37% of employees’ overall employment expectations, according to UKG research. Don’t get me wrong, everyone wants to receive fair pay and relevant benefits, but once employees receive fair pay and relevant benefits, the focus starts shifting. Thus, the financial side of employment accounts for only 37% of what today’s employees want. The other 63%? We will get there.

The importance of career growth and development

One of the most important expectations for employees beyond money is the opportunity for career growth and development. The reason for this is sound. The better employees’ skills and abilities, the better they align with higher-paying jobs, and the better their opportunities to be promoted and advance in their careers. In addition, roles with more responsibility support employees in fulfilling their potential to a higher degree and improve their perception of self-worth. Providing opportunities for career growth and development ticks a lot of different boxes on Maslow’s Hierarchy of Needs.

You have probably already concluded that the one thing that delivers all the benefits listed above is employee development. Based on what we have covered so far, employee development appears to offer a great win-win opportunity for employees and employers. If that is indeed the case, why is it that a lack of employee development opportunities remains one of the top preventable reasons employees leave their jobs? Considering only preventable reasons, a lack of employee development makes up close to 25% of why employees leave, based on the 2025 Work Institute Retention Report.

Why employee development is crucial

There are many different reasons why a lack of employee development can rise to the top of the list of why employees leave. There is the obvious scenario: Some employers offer little-to-no development opportunities. Other companies may be too selective on who they develop. Combine that with a tendency to hire from the outside, which prevents a promotion, and the message employees receive is pretty cut and dry. Another variable that significantly impacts an employee’s satisfaction level with development opportunities and career growth has more to do with perception than reality.

To better understand this aspect, let’s go back to the employer-employee dynamic. While the key parameters of the employment relationship—such as compensation, vacation time, and holidays—are covered in writing, there is a larger agreement at play that is known as the Psychological Contract. This contract doesn’t exist in writing and might have never been explicitly discussed between the employer and the employee. Instead, the Psychological Contract includes expectations, assumptions, and impressions employees either bring into a role or that they have picked up through statements made during the hiring process or even opinions from friends or family. While the Psychological Contract is an intangible construct, for employees, it is as real as a physical piece of paper with a signature.

Employee development opportunities, as well as career growth, are at the very core of the Psychological Contract. If employee development opportunities are not provided as expected, they can quickly cause the erosion of trust between both parties. The result is unnecessary friction that might lead employees to disengage, become disillusioned, and eventually leave their employer to look for better development opportunities in a different environment.

Real-world benefits of investing in employee development

On the contrary, when done well, employee development is a critical component that provides equally strong benefits to the employer and the employee and strengthens their relationship. Here are just a few examples:

• Companies that invest in employee development programs enhance their workforce’s skills and foster a culture of innovation and adaptability.
• Employees who see a clear path for career advancement are more likely to stay with their companies, reducing turnover rates and associated costs.
• Development opportunities can also improve employee morale and job satisfaction, leading to higher productivity and better overall performance.

Beyond the above examples, the positive business impact of employee development programs has been documented and quantified many times in some of the most prestigious journals.

Addressing the talent leak: The cost of neglecting development

Even with the business case for employee development comprehensively documented, a lack of employee development is still the number #1 cause for employees to leave their jobs. A lack of employee development is a talent leak companies cannot afford anymore, especially in light of the shrinking talent pool. With a forecast that projects an increase in labor deficiency by sixfold between now and 2032, it is a mission-critical task for every business to reduce the preventable attrition numbers.

Not offering employee development opportunities is similar in logic to not putting gas in your car because it costs money to drive the vehicle. Without a car, you cannot go to work, get groceries, and take your kids to Little League practice. The combined negative impact of losing your job, not having food to eat, and, maybe worst of all, having your kids miss out on fun activities, will cost you much more than putting gas in your car.

In summary

Today’s employees want to feel seen, heard, and connected, which makes up 63% of their employment expectations. Providing employee development opportunities is a non-negotiable component in building a strong employer-employee relationship. Employees who feel seen, heard, and connected will do amazing work that drives business performance.

Now is a great time to critically examine your organization’s effectiveness in providing employees with development opportunities—from the perspective of the employees. There is so much more at stake than just not meeting employee expectations.