The Surprising Employee Retention Risk Factor

Any good human resource team monitors employee retention to try to identify areas for improvement.

But the biggest risk to employee retention may come as a surprise.

It’s babies.

Yes, those bundles of joy, clothed in adorable onesies may look all sweet and innocent, but they’re the source of your biggest retention problem.

You’ve likely heard the news stories of the shocking number of women who left the workforce during the pandemic in 2020 (that would be more than 2 million women) - mostly due to caregiving responsibilities. But even pre-pandemic, the US has had a retention problem, with one in five new moms exiting the working scene after their baby’s birth.

In other words, whether it’s because they want to be stay-at-home parents, feel the work/family “balance” is unsustainable, or for any other reason that needs no justification or explanation, 20% of new mothers quit working entirely.

Interestingly, we don’t have solid stats on how many dads and non-birthing parents leave the workforce in a “normal” non-pandemic year, but as of 2016, 17% of stay-at-home parents identified as dads. That’s up from 10% in 1989 - a slow, but steady increase. Seeing trends of gender- and role-equality in the parenting world leave us to believe that more men and non-birthing parents will join the ranks of “stay-at-home parent” in the years to come.

And that’s just the obvious tip of the retention risk iceberg.

Understanding the intricacies of this retention risk means peering into a bit of human biology and psychology.

Becoming a parent for the first - or second, or fifth - time is a time of change, and not just in lifestyle or routine. There are biochemical forces at work here, particularly for birthing women, but for non-birthing parents too, that actually change how the brain functions. These changes to the amygdala, the part of the brain that controls decision-making, memory processing, and emotional response, often result in shifting priorities and a recalibration of life goals. When a baby is born, so too is a parent, and suddenly there’s a lot of self-discovery that has to happen (in the midst of feedings, diaper changes, and sleepless nights).

And for your organization, that translates to a sizeable financial risk; after all, losing employees is expensive, with the cost to find and onboard a replacement as high as 200% times the employee’s salary.

While building a career may have been the main focus pre-baby, parents engage in an intricate dance to have it all - a stable, rewarding career and a happy, healthy family. They are always on the lookout for ways to find that enigmatic work/life balance.

They’ll leave their organization if they find a different employer that better supports them in this quest.

After all, life works better when work life is better.

What are parents looking for?

  • More paid time off (Translation: More time to spend with family, better mental health)

  • More flexibility (Less guilt when needing to step away from work to tend to family needs, increased trust in the employer/employee relationship)

  • Better pay (More financial stability for the family and more opportunities for the future)

  • Better benefits (Additional financial, medical, or social supports that increase physical, mental, or emotional health for the family)

  • A different work location or shorter commute (Less stress, less wasted time, and more availability for family needs)

  • A more “parent-friendly” or empathetic culture (Clear work & family boundaries, defined expectations)

Smart organizations are utilizing a variety of techniques for monitoring and mitigating this retention risk, and if your organization wants to take a closer look, here are a few questions to get started:

  • What do your competitors - both for market share and employee talent pool - offer for benefits? How do your policies and benefit offerings compare?

  • Are there discrepancies between how the organization defines its culture and how employees perceive it?

  • Does the organization utilize a variety of channels to solicit feedback from employees?

Check out our assessment to learn how your organization stacks up and see steps you can take now to address common concerns from working parents.

Luckily for the human race, those babies are going to keep on coming. Parents are going to continue to look for ways to have the best of both worlds - a successful career and a fulfilling family life. How organizations respond and support their working parent employees has a direct impact on the financial bottom line.

What are you doing to minimize this risk?