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While is may be ‘cheaper’ for retention on paper, it takes a lot to turn a Titanic. Good retention requires effort, engagement, consistent feedback, a lot of times a culture shift, a commitment of individuals to stick to retention, and a steady leader, who is willing to accept mistakes made in the past, own them, and redirect. And as with most things, it starts at the top. If the leader isn’t willing to accept and change mistakes from the past, or have the exec buy in, it’s honestly easier to keep things as status quo. There’s a level of humility mixed with dedication and buy in that a lot of companies aren’t willing to have.
Honest reply
Because they’re going to leave anyways. Unless money the sole driving factor, they’ll go.
Agreed 100%. Once an employee decides they're leaving nothing can really stop it. Most feel even more disgruntled because they feel you should have paid them that all along.
Typically to capture work forces from competitors. These "budgets" both come from the same place, the staff you have doing the work. Paying out more to hire new workers at the cost of your existing staff is unethical in the best situation.
I have seen this across organisations. It is easier to justify new spend than adjust existing salaries. It creates frustration internally.