The history of Employee Retention can be traced back to the industrial revolution when businesses initially started focusing on keeping their labor force satisfied. This was a novel thought in times when the prevalent practice was exploiting workers to achieve maximal productivity, regardless of worker conditions and job satisfaction.
In the early 20th century, the idea of employee retention began to gain momentum. Prominent psychologists, like Frederick Herzberg and Abraham Maslow, presented theories emphasizing the importance of job satisfaction, hence adding a new dimension to employee retention strategies.
The era post World War II saw a major shift in employee attitudes. Workers now sought more job security and better prospects for growth. This period marked the beginning of the concept of ‘job for life’. The 1950’s saw companies offering generous fringe benefits, defined benefit pension plans and promoting longevity of tenure.
Since the 1980s, the dynamics again began to change. With more women entering the workforce and the advent of new technology, the concept of flexible working hours was introduced. Due to an increasingly competitive market environment and globalization, organizations had to come up with innovative retention strategies.
It was within these evolving parameters, the term “Employee Retention” was coined as a strategic business practice. This became further refined in the 21st century with the introduction of work-life balance approaches, employee wellness programs, and the advent of remote working, particularly post Covid-19 pandemic.
As we look ahead, it’s clear that employee retention has evolved from a mere concept to a vital business strategy. Undoubtedly, its future will be characterized by more innovation, flexibility and a deeper understanding of employee needs and aspirations.