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Why is employee turnover in the Real Estate Sector so high?

Recently I’ve been working with some clients in the real estate sector and wow what a fast paced, dynamic industry! I really loved being immersed in this work environment which is a fabulous mix of corporate and hospitality. With pretty much every role being customer-facing in its own way, there are so many opportunities to exceed customer expectations and drive growth. But to drive sustainable growth in this sector, it takes highly engaged team members and an understanding at management level of what the key drivers of engagement actually are.

The one HR element each client had in common – high staff turnover. There are so many varying statistics floating around out there on how much it costs a business to replace a team member so I won’t quote any here other than to highlight the tremendous savings potential available to Agency owners by reducing employee turnover rates.

Why & What can be done?

Here are 3 of my suggestions:

Poor hiring decisions – For those Agencies that handle their own recruitment processes there is often a distinct overemphasis on gut-feeling when it comes to selecting amongst candidates, with little consideration for best-practice recruitment methodologies and selection tools. Often there is no standardised process, no specified interview questions and no use of candidate profiling tools – all of which bring added rigour to the decision-making process.

Another shortfall Agencies can fall into is not providing hiring managers with training in interview skills. And while it’s obviously important to document the tasks required in the position descriptions for each role, it’s equally essential to document the specific capabilities and personal qualities required in each role. Each of the selection tools used in the recruitment process can then be designed to elicit the right information from candidates (eg. application form questions, phone screening, interview questions & reference check questions).

Untailored onboarding processes - For those newcomers who have completed their theoretical legislative training, there is often a gap in learning between getting their registration and actually being hired. And if the employer doesn’t have a well designed onboarding process in place to develop these newcomers across this gap, it can be a very stressful time travelling such a steep learning curve. This seems to be leading some to question their future in real estate.

After only months of employment, these tired, stressed and overworked new recruits literally sink so it’s no wonder they leave their job, or in some cases the industry.

Lack of either real or perceived career opportunity – availability of career opportunities is a key driver of engagement and within the sector there seems to be a lack of either real or perceived career opportunities. While more forward-thinking Agencies are looking at developing customised career paths and more emphasis on longer term goal setting, it’s important to remember that promotion is not the only answer.

Not every employee has the skill set or even interest in taking the next role on the ladder. This is where finding other career growth opportunities for these individuals is useful. It might be a sideways move into another team that will revitalise the team member and maintain their engagement, or maybe giving a longer-serving experienced team member responsibility for training newer team members, or even responsibility for reality testing new technology or procedures before they’re implemented.

Even taken together, intelligent hiring, elevated career opportunities, and tailored onboarding processes will never reduce employee turnover to zero. But just a 5% decrease in turnover can improve your position in this highly competitive market.

Article written by:
Jackie Strachan, HR Tactics
Specialists in HR for SMEs