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Why Investing in Your Employees Is So Crucial

Why did you leave your last job? Was it for a new opportunity that you couldn’t pass up? Or was it due to an issue at your old job? One of the most frequent reasons that people quit their jobs is due to feeling unappreciated or undervalued by their employers or managers. One of the ways employees feel unappreciated is if they feel as though they are not growing within the company. “Growing’ means more than just getting a promotion. It also means advancing their skills and knowledge-base. 

Things like continuing education, whether through formalized classes or through conferences, books, or training materials, is a great start. Subsidizing part, or all, of the costs of professional development opportunities has high returns in the long run and in the short term. Particularly, if your business is moving into new growth areas with rapidly changing technology. Or if you are attempting to reach new segments of the market with your offerings and services. 

If your business does not have a way of investing in your employees, we will layout several reasons why you should consider creating ways to do so. Here are some powerful reasons why you should be investing in your employees.

Prevents Weakening of Your Team

Attrition in your workforce should be one of your primary concerns if you employ anyone. Whether you are a team of two or a team of two hundred or more, weakening of your team can cause major problems. An employee leaving your company is costly, both in terms of resources, money, and time. It can also be disruptive for months to come as you search to find their replacement. 

While it is impossible to remove all attrition in a workforce, because even if an employee spends their entire career with you they will ultimately age out of the workforce or pass away, you can strategize steps to tackle the issue and remove some of the factors that impact it. Investing back in your team can increase employee satisfaction. And, a happy employee is less likely to leave a job they love.


Makes Employees Feel Appreciated

Employees who feel valued, appreciated, and invested in are far less likely to leave your company than those who do not. Investing in your talent will have returns that exceed your original investment, both in terms of lessening attrition rates but also in attracting employees.

Showing appreciation to your employees should be a continuing part of your relationship with them. Many people prefer to be thanked or shown appreciation in “real-time” rather than after the fact. While consistent real-time congratulations can be distracting from work, a simple thank you or letting them know that you appreciate their hard work on a project or for putting in long hours can go a long way

Every manager, leader, and business owner needs to ask themselves, what do you do to appreciate and invest in your employees? It is far easier to write off employee appreciation and investment as simply thanking your employee for their contributions during an annual review or during bonus season. Those are certainly two ways that you can appreciate and invest in your employees, but they can’t be the only ways.

Good leaders understand that those they lead do so for their own interests. It is the leader’s job to create a system in which people want to follow them because they see those two sets of interests as overlapping. For instance, employees want to feel valued in the work that they do. As a leader, that should be a priority that you share. Not one that conflicts with your own priority of wanting to feel valued by those you lead. 

It Builds Healthy Connections With Co-Workers

When you invest in your employees, you create a culture of growth and advancement. Co-workers can share in the growth process and will be able to relate to each other has they grow together. But it is important that the method you use to invest in your employees is something they will actually benefit from.

Know and understand what your employees want and need from you. Offering incentives and perks that no one wants or needs will be a waste in terms of resources and time. It may also end up backfiring if employees see you as out of touch with their needs. 

Talking to your employees about what they value and need is a good way to determine ways you can be a part of their personal and professional development.  A formalized way to approach this is through Individual Development Plans. These empower employees to think critically about where they are now, where and what they want to be in the future, and the steps that it will take for them to get to that place. 

A large part of investing in your employees is interpersonal. Cultivating a healthy and supportive working environment, both in terms of the relationships your employees form with each other and with leadership, is critical for the success of your business. 

It Builds Company Loyalty and Trust

As a leader, make yourself available to hear from your employees. Whether it is their questions, comments, and suggestions, and yes, their complaints. Ask for feedback whenever appropriate and implement it. Utilize your employees’ creativity, and encourage them to have a stake in the success of your business. Having skin in the game is mutually beneficial for both parties. Employees who are invested in the success of your company beyond ensuring their next paycheck are far less likely to leave their job. 

All of these things can increase your employee’s loyalty to the company and build trust between management and support staff. When you invest in your employees you are telling them that you care about them and their growth. You also send the message that they are there for reason beyond filling an open job position.


Combating attrition in your workforce takes a considerable level of awareness about your relationship with your subordinates. Investing in your employees and offering them meaningful opportunities to engage with your business and to grow professionally, as well as showing your appreciation for the work that you do, is a key way to combat employee loss.


This article was first published in December 2017 but has been updated and expanded

Cassidy Welter on Twitter
Cassidy Welter
Staff Writer: Cassidy Welter is a Chicago based researcher at a consulting firm specializing in nonprofits. When she's not working, she's reading anything she can get her hands on, debating politics, watching the Pittsburgh Penguins and eating her way across the city's food scene. See more from Cassidy on Twitter at @CassidyWelter.

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Find Your Way · Grow Your Business · Leading Your Team · Productivity · Your Mindset

Staff Writer: Cassidy Welter is a Chicago based researcher at a consulting firm specializing in nonprofits. When she's not working, she's reading anything she can get her hands on, debating politics, watching the Pittsburgh Penguins and eating her way across the city's food scene. See more from Cassidy on Twitter at @CassidyWelter.

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