Employee turnover is one of the biggest challenges facing organizations in 2025, with 51% of employees seeking new job opportunities. This is the highest rate since 2015, according to Gallup’s latest measure.

Employees’ long-term commitment to their organizations is at an all-time low. Many leaders struggle to understand the causes behind this shift. Meanwhile, the costs of turnover are staggering. Replacing a frontline employee can cost up to 40% of their total salary and replacing a leader costs up to 200%, according to the same Gallup data.

The reasons for turnover can vary. However, three often-overlooked factors contribute heavily to the current wave of resignations — financial strain, career stagnation and a lack of managerial communication.

By addressing these underlying issues, organizations can mitigate turnover while fostering employee loyalty and satisfaction.

1. Financial strain

A Bank of America report found that 64% of U.S. workers feel stressed about their finances. Meanwhile, 67% of workers feel their cost of living is outpacing growth in their income. Financial stress challenges workplace productivity, retention and overall organizational success. Employees who struggle with financial stress are likely to feel discontent at work.

The retention cost is equally stark. Data from Morgan Stanley’s Graystone Consulting found that around 40% of turnover can be attributed to employee stress. What’s more, even employees who don’t leave their companies can still be impacted by poor financial health. Stress-related absenteeism costs organizations more than $3.6 million per year.

These numbers underscore the need for employer action against financial stress — a need that employees fully endorse. In the same Morgan Stanley data, 74% of employees felt it was important for their employer to offer financial wellness support. Another 60% of employees said they would be more likely to stay with an employer who provided financial benefits.

Solution: The right financial wellness benefits to combat employee turnover

To combat employee stress, organizations must prioritize comprehensive and personalized financial wellness programs. Here are strategies to consider:

Financial education programs. Equip employees with knowledge about budgeting, saving, investing and debt management through workshops, webinars or online courses.

Emergency savings plans. Offer tools or incentives to help employees build emergency funds, providing a safety net for unexpected expenses.

Student loan assistance. Recognize the burden of student debt, especially for younger generations, and offer repayment support or refinancing options.

Retirement planning support. Provide access to retirement savings plans with employer contributions, along with resources to help employees plan for long-term financial security.

Personalized financial coaching. Partner with financial wellness platforms to offer employees one-on-one sessions with financial advisors tailored to their unique circumstances.

Pay transparency and adjustment. Regularly review and adjust pay to align with inflation and market rates, ensuring employees feel valued and financially stable.

Supportive organizational culture. Ensure employees understand the financial resources and support available to them. Normalize conversations about financial well-being in the workplace to reduce stigma and foster a supportive environment. Refine financial wellness programs based on employee feedback.

2. Lack of career opportunities

In today’s competitive labor market, talent retention is critical for organizations. The talent pool is shrinking. There were only 6.8 million unemployed workers in the U.S. and 8 million job openings as of September 2024, according to Forbes data. Experts anticipate this trend will continue, potentially leading to a deficit of over 6 million workers by 2030. Against this backdrop, professional stagnation emerges as a top threat to employee retention heading into 2025.

A lack of growth opportunities can drive away employees who may search for professional fulfillment elsewhere. In fact, a joint survey by Amazon and Workplace Intelligence revealed that nearly three-quarters of these younger workers would leave their current roles if career development options were insufficient. Such dissatisfaction often leads to frustration, disengagement and burnout. Forbes also found that 40% of HR experts predict burnout will increase in 2025 and 38% believe it will persist at current levels.

Solution: Personalized career growth programs

Employees increasingly demand professional development initiatives tailored to their unique needs, aspirations and learning styles. Personalized development fosters engagement, strengthens loyalty and equips employees with skills that align with both their career goals and the company’s needs.

Employers can cultivate growth through mentorship programs and job shadowing opportunities. These allow employees to map out their career goals and broaden their professional horizons through ongoing guidance. This might include workshops and seminars that focus on skill development. Employers can also offer financial support for certifications, courses or degrees relevant to employees’ roles.

Organizations can leverage AI-powered tools to provide scalable, personalized learning experiences. These technologies identify skill gaps, curate individualized learning paths and offer insights for continuously improving development programs. Employee-led growth initiatives, which empower individuals to shape their career trajectories, are also gaining traction. Providing diverse resources allows employees to take ownership of their professional development, mitigating the risks associated with professional stagnation.

3. Missed managerial conversations

A key, yet often overlooked, cause of employee turnover is the lack of proactive communication from managers. A Gallup survey revealed that 45% of employees who voluntarily left their jobs in the past year reported that neither their manager nor another leader engaged with them about their job satisfaction or career goals in the three months leading up to their departure.

Furthermore, many employees leave without ever discussing their intentions with their manager. Around 44% of voluntary leavers did not talk to their manager before resigning. At the same time, 42% of them say their departure could have been prevented.

This communication gap can make employees feel disconnected from the organization and undervalued. Without the right conversations about career development, job satisfaction and future prospects, employees are more likely to seek opportunities where they feel more supported.

Solution: Proactive conversations to address employee turnover before it occurs

The solution is clear: Managers must initiate meaningful conversations with their direct reports before it’s too late. Regular check-ins focusing on job satisfaction, career goals and work-life balance are essential. Managers should also take the time to ask about employees’ challenges and frustrations, not just about their successes.

One of the most effective ways to boost retention is to discuss career development. Managers should work with employees to outline clear career paths and offer development opportunities, ensuring employees understand how to contribute to the organization’s long-term success.

Positive reinforcement and employee recognition can go a long way in increasing engagement. A manager who shows genuine interest in an employee’s growth is far more likely to retain that talent.

Employee turnover is a complex issue with far-reaching consequences. But an employee’s exit is not always inevitable. Addressing financial stress, career opportunities and communication gaps can help reduce turnover rates and increase employee retention.

Looking for the right wellness benefit in 2025? Try Best Money Moves.

Best Money Moves is an AI-driven, mobile-first financial wellness solution designed to help employees with varying levels of financial knowledge dial down their most top-of-mind financial stresses. As an easy-to-use financial well-being solution, Best Money Moves offers comprehensive support toward any money-related goal, ranging from debt management to purchasing a home. With 1:1 money coaching, budgeting tools and other resources, our AI-driven platform is designed to help bolster employee financial wellbeing.

To learn more about Best Money Moves Financial Wellness Platform, let’s schedule a call. Contact us and we’ll reach out to you soon.