The entire office suffers when talented employees leave. Never mind the cost of hiring, onboarding, and bringing a new person up to speed. Losing good employees leaves the remaining workforce demoralized and stressed with an unaccounted-for workload. Without good employee engagement, everything falls apart.

AI-driven HR software can be vital to retaining employees

As the great resignation continues, many companies are turning to AI features in HR enterprise software to increase retention and reduce turnover. That’s where AI comes in. In June of 2022, workflow company ServiceNow snapped up the AI-skills insights startup Hitch Works despite making a pledge of no new acquisitions.

Keeping valuable talent may seem like an art, but software can help great people from leaving. So, how does AI factor into HR keeping great employees? We’ll get to that, but first, let's examine how serious the problem really is.

How many people are quitting during the great resignation?

More people are leaving their jobs than ever during what the industry calls the great resignation. One in five U.S. workers are expecting to leave their job in 2022, according to the PwC’s Global Workforce Hopes and Fears Survey 2022. 

While this issue is prevalent in the U.S., it’s not unique. One McKinsey study showed that 60% of Indian respondents wanted to leave their current jobs, while 49% of workers in Singapore expressed discontent.

Given this mass exodus of workers, it’s time to examine the actual cost of turnover. It’s difficult to say and varies from company to company. The cost of getting someone new in the door adds up fast, with Zippia reporting most respondents spent about $4,425 for each new hire.

Still, that’s nothing compared to the cost of replacing workers. According to the Society for Human Resource Management (SHRM), it can cost up to one-third of that employee’s salary to replace them. That’s $20,000 to replace a worker who makes $60,000 a year.

Most businesses can’t afford this. So, let’s get to it. How can businesses prevent their workers from leaving? It’s time to turn to AI in HR software.

AI features in HR software can help reduce turnover

So how exactly can algorithms, chatbots, and machine learning prevent a mass resignation? The answer is multifaceted. Here are a few new or improved features AI is spearheading in the current HR landscape:

Natural language processing (NLP)

One way AI helps is by identifying employee engagement trends. Administrators take feedback from employees and boil it down to its core to discover common employee sentiments. Submitting pulse surveys is the traditional method of measuring this metric, but AI takes it to the next level. 

Enter natural language processing (NLP). Going beyond classic keyword searches, NLP identifies specific emotions and areas of contention. It then quantifies that feedback and provides actionable insights. This method prevents confirmation bias, or subconsciously confirming what one already suspects to be true.

This doesn’t replace the tried and true metrics that HR lives and dies by. It’s still important to keep an eye on turnover, absences, performance, and other indicators. However, NLP provides extra context to give the data shape in a more 3D way.

Emotional intelligence 

All the tracking in the world is useless if you don’t know what to track. Asking simple questions like, “Are you satisfied in your position?” doesn’t get deep enough to understand how the staff genuinely feel. According to the Harvard Business Review, the rise of negative emotions in the workforce is higher than pre-pandemic levels, with anger, sadness, and worry as some of the most common negative emotions felt in the workplace. 

On the flip side, it’s essential to track the 10 positive emotions psychology scholar Dr. Barbara Fredrickson identifies in her book: Positivity: Top-Notch Research Reveals the 3-to-1 Ratio That Will Change Your Life. They are joy, gratitude, serenity, interest, hope, pride, amusement, inspiration, awe, and love.

Okay, so tracking “love” may not be feasible for every employee pulse survey, but understanding emotional strengths and weaknesses highlight trends that lose high performers.

Conversational AI or chatbots 

Once used in more simple contexts, chatbots are skyrocketing in importance. To start out, chatbots can improve diversity and reduce bias in hiring. Research shows that people from marginalized groups are more likely to leave tech. By using algorithms to pursue a blind hiring process or measuring diversity initiatives, users create a more inclusive workforce.

Next, there’s the process of onboarding. It’s no secret that a confusing or overwhelming onboarding process can discourage new hires. Onboarding chatbots provide quick answers to common questions, help users find resources, and get them accustomed to the new tech they must master.

Finally, we come to the truly innovative (and somewhat scary). Amber is a chatbot created by the Delhi-based entrepreneur Tanmaya Jain. It’s designed to check up on employees at specific milestones, identify potential flight risks, and gather valuable feedback. Positive reinforcement and curiosity guide the process. The chatbot asks personalized questions to understand where complaints originate and how the organization can help. Ultimately, it provides employees a place to vent without fearing retribution.

Parsing metadata 

Before an employee leaves, they’re probably going to tell someone about it. Most people vent to their coworkers or leave some other indication in their communication that they’re dissatisfied. Screening and reading worker messages are often seen as a massive breach of trust and can make employees feel their organization doesn’t trust them. 

On the other hand, the ability to analyze metadata can provide the same insights without the specifics. Instead of looking through the messages themselves, the algorithm examines the metadata and communication patterns for signs that people are close to leaving. These behavioral trends shine a light on overlooked employees while keeping the specifics private. 

Now that we’ve discussed the state of AI and employee engagement in the industry, let’s examine the data from G2.

Trends in G2's Employee Engagement Software category

Taking a closer look at G2 review data, we are seeing strong interest on the customer side. The average number of reviews for employee engagement software on G2 has risen steadily year over year after a slight dip in 2020.

While 2022 hasn’t ended yet, there’s already a clear increase in the number of new reviews between January and July. The current peak came at 491 new Employee Engagement reviews for in July of 2022.

However, it is worth noting that, over that same period, the average NPS has fallen ever so slightly from 9.48 to 9.43. For the last seven days from July 26, 2022, the Employee Engagement category has ranked 11th of the top 20 for most reviews in categories on G2.

G2 review data for Employee Engagement category (Jan 2022 - July 2022)

How are acquisitions playing into employee engagement?

Between 2020 and 2021, the number of employee engagement acquisitions recorded on G2 tripled. As the Employee Engagement category on G2 is defined by the creation of pulse surveys, it shows companies are prioritizing feedback from their employees.

Combine this with the uptick in acquisitions of AI technology, even in the face of an upcoming recession. Overall, the data shows an increased interest in retaining top performers. Getting uncut data on workplace challenges is difficult. No one wants to be labeled as a “complainer.” However, not fostering an organization where employees can speak their minds openly means losing the single greatest resource of any business.

I predict these numbers will continue apace in 2022 and on to 2023 with the looming recession. The loss of productivity and morale that comes from losing star employees is devastating and the hiring costs are prohibitive. That’s why companies will be doing everything they can to get their best people to stay.

Looking ahead

Keep an eye on employee engagement software in 2023 and beyond. It’s clear there are numerous innovations in AI which could give further insight into preventing turnover. However, it’s still worth noting that none of this means anything if something very basic is missing. Communication. Whether it’s giving workers a clear channel to speak to managers and one another with employee communications software or soliciting and analyzing feedback, it’s all about how comfortable workers feel bringing grievances forward.

Employee engagement and talent management software will continue to evolve. Each new tool can help organizations understand why employees are unhappy and therefore prevent their departure. However, it’s tempting to think a shiny new AI is the be-all and end-all of HR when the reality is much more complex.

People tell you when they’re unhappy in a million different ways without saying a single word. Fostering a safe place where workers feel comfortable discussing potential problems and solutions should be the primary goal. When all is said and done, employees want to know that someone cares about them. Specifically, that a human being cares about them (though Amber is getting pretty close.) When an organization has that, AI tools can help bridge most gaps between workers and employers.

Edited by Jigmee Bhutia