Five Employee Retention Strategies to Keep Top Talent Engaged

Why employee retention matters for your company

Employee retention is a direct business growth lever. When top-performing team members walk out the door, the cost to replace them hits the bottom line hard. Recent studies show the average cost of replacing an employee in 2025 is around 33 percent of that employee’s base pay — and for more senior roles, it can easily hit 200 percent of salary. 

One survey found businesses spend an average of $36,723 annually in rehiring and lost productivity tied to turnover — and for one in five hiring managers, that number tops $100,000.

The implications are clear: every time you lose a valued employee, you’re paying for job ads, recruiting time, onboarding, training, lost project momentum, and diminished institutional knowledge — and you’re paying again while the replacement ramps up. Given this, retention should be one of your top strategic business priorities. By keeping your best people longer, especially those with hard‐to-replace skills or institutional knowledge, you reduce cost and sustain competitive advantage.

Luckily, there are plenty of employee retention strategies. After all, Gallup also found more than half of workers voluntarily leaving their jobs report that their bosses or companies could have prevented their exit. 

Here’s a list of ways managers and organizations can invest in their employees and retain top talent.

1. Employee retention and engagement starts at the leadership level

Leaders set the tone for everything. According to Gallup’s mid-year 2025 study, only 32 percent of U.S. employees say they are engaged in their work. That stagnation signals a major leadership challenge.

Gallup found that fewer than one in five employees (19 percent) are “extremely satisfied” with their employer as a place to work, and more than half are actively looking or keeping an eye out for job openings elsewhere. The authors note that when “ambiguity from leadership creates uncertainty,” trust breaks down and retention becomes an uphill climb.

In other words, retention and engagement cannot be delegated. Your frontline manager or team leader influences whether their team feels seen, heard, and anchored to the company’s mission. To make this tangible, tracking leadership-level metrics (such as turnover by manager) is critical. This gives HR teams insight into which leaders deepen engagement and which may be losing talent.

Leaders must also focus on transparency and connection. As the Gallup article puts it:

The implication is clear: a weak leadership culture is a risk to retention. An engaged leader builds trust, supports growth and keeps people from wondering what’s next.

2. Really listen to employee feedback, and follow through

Engaged leaders are strong communicators and, more importantly, active listeners who build trust among their employees — and trust is still the foundation of employee retention. Recent Gallup research found that when employees receive meaningful feedback at least once a week, they’re nearly four times more likely to feel engaged at work.

That engagement comes from more than just asking questions. As Gallup’s researchers note, “Feedback has the most impact when it’s timely, specific, and followed by action.” Employees who see their input lead to real change are significantly less likely to leave. A 2025 Amazing Workplaces study echoed this finding, reporting that organizations with consistent, transparent feedback systems experience roughly 15 percent lower turnover than those that gather feedback but fail to act on it.

To make feedback meaningful, leaders should set the tone from the top. Encourage regular one-on-one check-ins, share survey results openly, and follow through on commitments made. Employees can tell when listening is performative and when it’s genuine. The follow-through is what turns feedback into trust, and trust into loyalty.

3. Create and support an inclusive culture

An inclusive culture is something leaders have to build and sustain every day — it doesn’t happen by accident. The 2024 Women in the Workplace Report by McKinsey and Company and LeanIn.Org shows that while women now hold 29 percent of C-suite roles, only about 7 percent are women of color. The study also found that fewer than half of women of color say their manager shows interest in their career advancement.

As Rachel Thomas, co-founder and CEO of LeanIn.Org, says, “You can’t hire your way to equality. Lasting progress comes from changing the culture so that women and underrepresented groups can thrive.”

In other words, hiring diverse talent is just the first step — keeping them requires inclusion, visibility, and consistent support from managers. The same report revealed that women who have strong allies and advocates at work are far less likely to consider leaving their jobs.

“Senior leaders set the tone at an organization,” says Lorraine Hariton, president and CEO of Catalyst. “If you want to change culture, you’ve got to do it at every level of the organization.” Organizations that prioritize inclusion strengthen innovation, morale, and trust. Building that kind of workplace means giving every employee equal access to opportunities and belonging.

4. Invest in employee growth opportunities

When people leave their jobs, salary is rarely the only reason. More often, employees leave because they don’t see a future for themselves in the work they’re doing. The 2025 Work Institute Retention Report found that career and growth issues account for nearly one in five resignations.

A LinkedIn Learning Workplace Learning Report echoes this finding, showing that organizations with strong internal mobility and visible career paths retain employees significantly longer than those without.

Managers play an important role in creating those paths and helping employees take control of their careers. As the LinkedIn report puts it, “Employees who feel in control of their careers and are inspired to build their own best future” is a key driver of growth. 

One effective strategy is to create more in-role growth opportunities. For example, break entry-level positions into smaller stages with defined milestones every six to 12 months. That way, employees can see their progress and stay motivated, rather than waiting years for the next step. When leaders invest in helping people develop, they’re also investing in loyalty, engagement, and long-term performance.

5. Go deep with exit interviews

Known as a leader on work-life balance (read: mandated employee surf breaks) and for its unusually low employee turnover rates, outdoor clothing company Patagonia is known for doing things differently. Its approach to exit interviews is no less unique.

Dean Carter, the company’s chief human resources officer, told an audience at the Qualtrics X4 Experience Management Summit that he has been moved to tears during exit interviews. He suggested starting the conversation from the beginning, with how employees came to join the company in the first place, rather than why they are leaving: “After that, it’s ‘Did we do that?’ ‘What was the experience we delivered for you?’ ‘Where was the difference in that?’” he said.

Increasingly, many organizations are adding “stay” interviews to their employee retention toolbox. These interviews involve discussions with employees to explore and understand why they want to work for their company and what it will take to keep them.

Common challenges in employee retention

Even the strongest organizations face challenges that make retention difficult. When engagement slips or communication breaks down, turnover rises. Understanding these common issues helps leaders address problems before they grow.

Disconnected communication: When updates are scattered across emails, meetings, and chat tools, employees can feel left out or uninformed. Missed context often leads to frustration and lower trust. Centralizing communication in shared spaces helps everyone stay aligned on goals and progress.

Limited growth opportunities: A lack of visible career paths can make even top performers feel stuck. Employees want to see how they can grow within the company. Regular check-ins, mentorship programs, and open discussions about development plans help keep ambition connected to opportunity.

Inconsistent recognition: Recognition that’s rare or impersonal can make employees question whether their work matters. Genuine, timely appreciation builds motivation and belonging. Encourage managers and peers to share quick shoutouts in team channels or through async tools like Clips.

Lack of feedback loops: When feedback flows only one way (top down), employees can feel unheard. Create regular opportunities to gather input through surveys, one-on-ones, or other channels. Just as important: follow up on what’s shared, so employees see their voices lead to action.

Burnout and overload: Even highly engaged employees can lose motivation when workloads stay high without flexibility or support. Encourage balance through focus-time scheduling, async collaboration, and clear boundaries around communication outside work hours. Sustained engagement depends on rest and well-being as much as productivity.

Employee retention means investing in your employment brand

Effective, multifaceted engagement with employees of all types and stripes is hard — but replacing them is even harder and more expensive. Leaders and organizations that invest the time to figure out what employees need to stay engaged in their jobs will be most successful in keeping them. A strong employee retention strategy will also appeal to a happier, more productive workforce that inspires and elevates others around them. 

Enable employee retention with Slack

Slack helps teams strengthen communication, connection, and transparency, the foundations of lasting engagement and retention. Channels keep everyone aligned on updates and priorities, while tools like huddles and clips make it easy to share quick updates or async messages without adding more meetings. With Workflow Builder automating check-ins and Slack AI summarizing long discussions, leaders can stay closely connected to their teams’ needs and morale. 

Together, these features make it easier for employees to feel engaged, supported, and valued. Engaged employees are loyal employees. Slack helps teams stay connected, recognized, and motivated, creating the kind of workplace people want to stay in.

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