Do Flexible Work Arrangements Improve Employee Retention?

With staffing shortages continuing, small businesses need to find ways to reduce turnover and improve employee retention rates. One proven way to do that is by offering flexible work arrangements, such as remote work, flexible hours, and part-time positions.

Surveys show desire for flexible work options

Surveys repeatedly show that employees prefer the flexible work options that have become more prevalent since the outset of the Covid-19 pandemic. McKinsey & Company found that 87 percent of workers who were offered at least some remote work took their employers up on the opportunity.

Business leaders are also recognizing the connection between giving employees flexible work options and retention rates. A 2023 survey by the Conference Board found that 71 percent of employers with mandatory on-site work policies find it “difficult” to retain workers, compared to 46 percent of businesses that offer more flexibility. And a 2023 survey by Targus found that 88 percent of the 1,000 business decision-makers surveyed agree that flexible working options positively impact staff retention and recruitment. 

Choose the right flexible work option for your business and your employees

Fully remote work might be the most commonly discussed flexible work arrangement, but there are many different options worth exploring for different businesses. 

Fully remote work can be a great option for small businesses that want to attract top talent regardless of location and that want to diversify their workforce. Moreover, fully remote work is popular with many employees who report that it fosters a sense of autonomy and work-life balance, leading to increased job satisfaction and reduced turnover. 

Hybrid work options, with some portion of each week spent in the office, provide advantages to businesses that want employees in the office for meetings, teamwork, and other reasons. Hybrid work limits the talent pool to the nearby area, but it also gives those local employees some of the flexibility that they often desire.

Flexible hours are another viable option for small businesses. The traditional 9-to-5 model no longer fits many people’s lifestyles, so offering flexible hours demonstrates a commitment to employee well-being. It also supports those with unique needs, such as parents who need to balance work with childcare responsibilities, which can result in reduced turnover. 

Part-time positions are gaining in popularity. Whether it’s seasonal peaks or project-based work, part-time positions allow businesses to scale their workforce without the overhead costs associated with full-time employment. Additionally, part-time roles can be attractive to retirees or individuals pursuing further education, bringing added experience and diversity to the workplace.

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