In a rapidly evolving job market, retaining top talent has become one of the most pressing challenges for organizations. Let’s face it, we are already challenged by the 10,000 Baby Boomers that are retiring every day in the U.S. – basically, our most knowledgeable employees are walking out the door. It doesn’t help that the processing plant across town is offering a 10 cent/hour raise. But are employees really focused only on better wages? 

Over the past two years, employees have been leaving their roles at an accelerated pace — and the reasons go far beyond compensation according to recent workforce data from 2023 to mid-2025. So, let’s explore the primary factors driving employee turnover and, importantly, what companies can do to reverse the trend.

Why Are My Employees Quitting?

One of the most cited reasons for employee departures is a toxic or negative work environment. According to the 2024 iHire Talent Retention Report, 32.4% of employees who quit in the past year named workplace culture as their top concern. Poor leadership followed closely, with 30.3% stating they left due to ineffective or harmful managers, while 27.7% cited unhappy or unsupportive managers as a key reason for leaving (iHire, 2024). 

Alarmingly, culture-related issues contribute to high early turnover: 34% of new hires who quit within 90 days did so because the workplace didn’t meet their expectations — a figure consistent with broader HR trends around cultural misalignment. Research from the Society for Human Resource Management (SHRM) confirms that organizations with poor leadership are up to eight times more likely to experience high turnover, emphasizing that a toxic environment and weak leadership are powerful deterrents to retention. 

These challenges are not hard to understand as companies often promote employees to leadership and supervisory roles because they are dependable and know the operations — NOT because they have effective leadership skills. The old adage holds true: people don’t leave jobs — they leave managers. Arming our leaders with the leadership skills needed to improve communication, reduce favoritism, and increase empathy and motivation will go a long way to retaining employees. Companies should look for leadership training that is tailored to their industry for the best results. 

Another key reason employees move on is limited career growth and development opportunities. Another study from Amazon and Workplace Intelligence showed that 66% of planned job quitter respondents stated lack of career advancement as a reason and it strikingly noted that 74% of Millennial and Gen Z workers say they would leave their job if they saw no clear path forward. Intertek Alchemy’s 2024 Survey of Manufacturing Employee Training Programs found that 78% of companies with a mature upskilling program reported having highly motivated employees compared to just 43% of companies without such programs. 

These numbers reflect a growing demand for purpose-driven work and long-term career vision. A lack of access to learning programs, mentorship, or cross-training sends a strong message that the company does not value long-term growth, pushing high-potential employees to seek opportunity elsewhere.

Prioritizing Employee’s Mental Well-being

Closely tied to engagement and retention is work-life balance and burnout. According to the  2024 Grant Thornton Leaders Survey of 620 HR leaders, 23% said employees leave because their work-life balance “does not match their needs.” In a 2024 SA Journal of Human Resource Management study, 20% of respondents indicated they were likely to quit within the next year due to poor work-life conditions. Meanwhile, burnout continues to drive turnover — an OECD-cited HR survey revealed 46% of HR leaders reported burnout accounted for up to half their annual turnover. 

Given our operational challenges with changing product lines, tariff pressures, new supplier sourcing, and evolving customer demands, our employees will likely feel the organization’s stress. We must remember people no longer accept workplaces that ignore the need for balance and personal well-being. Employees who feel supported in managing their personal lives alongside their professional responsibilities are more likely to remain committed and productive.

Mental health has become a critical factor in employee retention. According to the 2024 Lyra Health “State of Workforce Mental Health” report, 60% of employees reported that mental health affected their performance, and 33% said they had considered quitting their job because of mental health challenges. In a separate survey by the National Alliance on Mental Illness (NAMI) and Ipsos (2023), 83% of U.S. employees said mental health training is important for fostering a positive workplace, and 92% stated that mental health benefits are essential when evaluating a job offer. 

Consider the stark contrast for employees just five short years ago when we were having daily well-being dialogues with employees — checking their temperatures to ensure they were healthy and COVID-free, protecting their workspaces from cross-contamination, and asking about their family’s health — as compared to today’s employee interactions. The data highlights a clear trend: organizations that do not prioritize mental health resources or cultivate psychologically safe environments are at increasing risk of losing talent. These are among the reasons my company continually adds more training courses related to mental health and life skills to our HR library of courses offered to manufacturing and warehousing organizations. 

Although many employers — as reflected in Franklin Templeton’s 2024 Voice of the American Workplace Survey — believe that compensation is the primary reason employees quit (36.3% of respondents held that view), the actual drivers differ. According to a recent Pew Research Center study, just 20.5% of employees cited “unsatisfactory pay or benefits” as their main reason for leaving — placing it sixth among resignation causes. This misalignment highlights a significant disconnect between employer assumptions and employee motivations.

While competitive pay remains important, it seldom outweighs issues like toxic workplace culture, limited career progression, or work–life imbalance, each of which consistently emerges as a top concern in numerous workforce analyses.

Training Can Reduce Turnover

Onboarding plays a critical role in employee retention, yet many organizations underestimate its impact. According to a survey by Leadership IQ, 46% of new hires fail within 18 months, often due to poor cultural fit and unmet expectations. Similarly, a BambooHR survey found that 31% of employees leave within the first six months, with 20% citing ineffective onboarding as a primary reason. 

Additional research from Gallup suggests that only 12% of employees strongly agree their organization does a great job onboarding new hires, contributing to early turnover. These findings highlight the importance of a structured and supportive job role-specific onboarding process, which has been shown to boost engagement, accelerate productivity, and improve long-term retention.

A comprehensive onboarding program should go beyond a checklist of compliance items — it should create clarity, consistency, and connection from day one. The Alchemy Training System helps organizations deliver engaging onboarding that aligns with company culture and operational needs. With tools for tracking progress, reinforcing training, and tailoring content to specific job roles, companies can create a strong foundation that sets new employees up for success.

How to Prevent Employees from Leaving

The financial implications of turnover are enormous. It costs employers an average of 33% of an employee’s annual salary to replace them. In the U.S. alone, turnover has been estimated to cost over $1 trillion annually. These costs include not just recruiting and training expenses, but also lost productivity, morale decline, and the departure of institutional knowledge.

To effectively reduce turnover, companies need to move beyond surface-level solutions and address the deeper issues driving people away as highlighted by this current body of research. This includes building a strong, positive culture; training and supporting managers; investing in learning and career growth; supporting employee mental health and well-being; and improving onboarding. 

Competitive pay and benefits still matter, but they are part of a much larger picture. The deployment of these solutions goes beyond the HR team but must be owned and embraced by all senior leaders collectively in order to make effective changes throughout the organization that will drive employee retention.

In conclusion, employees are no longer willing to stay in environments that don’t align with their values or support their growth. Today’s workforce wants purpose, clarity, respect, and opportunity — and they are willing to leave to find it. By listening to employee feedback and aligning workplace practices and learning and development programs with evolving employee expectations, organizations can build stronger, more resilient teams.