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Why Good Employees Quit: The Top 10 Reasons and How to Prevent Them

Eric Goldschein

Eric Goldschein

Eric is the partnerships editor at Fundera with nearly a decade of experience in digital media. He has written for a number of outlets including Business Insider, HuffPost, Men's Journal, BigCommerce, Volusion, Square, RetailNext, and Keap, covering entrepreneurship, finance, marketing, and small business trends. He graduated from the University of Pittsburgh with degrees in history and English writing. Email: eric@fundera.com.
Eric Goldschein
Editorial Note: Fundera exists to help you make better business decisions. That’s why we make sure our editorial integrity isn’t influenced by our own business. The opinions, analyses, reviews, or recommendations in this article are those of our editorial team alone.

There are few faster ways to cause major problems at your company than to forget that a good business is staffed by satisfied, energetic, and engaged employees. Happy workers are the lifeblood of businesses, and although you can’t do everything to make employees stay, there are many reasons why good employees quit—most of which directly relate to their employer and work environment. 

Some of what employers do to make their employees unhappy enough to leave altogether stems from the basics of human interaction. Other things correlate more specifically to the work itself, whether the environment, the job, or the culture. At a small organization, keeping good employees is even more important to the success and growth of the business. This being said, we’ll explore the top 10 reasons why good employees quit and hear directly from employees of small and medium-sized businesses about what led them or other coworkers to leave their jobs.

Top 10 Reasons Why Good Employees Quit

Despite all of the other complex and nuanced parts of running a business, you may find that managing your employees is actually much more complicated than you would have originally thought. Employees have different personalities, goals, needs, and it’s not always easy to balance business human resources with your general operations. Taking this into consideration, however, there are common reasons why good employees quit, that you can keep in mind as you interact with your employees on a day-to-day basis.

Many of these reasons directly relate to the work environment that your business fosters and how you manage your employees as a leader. Although you may not always be able to prevent good employees from leaving, you can try to avoid these pitfalls and instead foster ways to put your employees—and your business—on the best track for success.

1. Lack of Respect or Trust

It may seem like a simple thing, but one reason why good employees quit is that they don’t feel like they’re respected or trusted at work. Whether they feel like they’re not respected by their boss, or by their coworkers, these negative feelings can build up, eventually causing them to decide to leave. Employees may perceive this lack of respect in many ways—it could be the way that they’re spoken to, the kind of work they receive, or the way their managers oversee their work.

As an example, employees who are micromanaged by their superiors often feel that they aren’t being trusted and given the authority to perform their duties autonomously. If employees feel particularly restricted or stressed in this manner, they’re not encouraged to do their best work and often seek an opportunity with a more conducive work environment for them.

To prevent this issue within your business, you should have an open and honest relationship with your employees. You should encourage them to work with you and ask questions, but ultimately trust that they have the skills, knowledge, and responsibility to do the work you hired them to do. It may surprise you, but ultimately, your employees’ happiness can actually increase productivity.

2. Low Pay

Paying employees only the legal minimum, or below what they might make at other companies, could seem like a good idea on paper. Paying people less costs less money. However, low wages is another reason why good employees quit—and it could end up costing your business more in the long run. Although you may think that an employee’s salary is fair, you have to consider how it compares to industry standards. If your employee feels like they’re not being paid well for the work that they do, but they can find better pay for the same job elsewhere, they’re going to look for that higher-paid opportunity.

“I worked for a digital media company where the boss was obsessed with keeping costs low,” says a man who has since moved on to another digital property. “All we’d talk about amongst each other was how miserable we were and how little we were getting paid. It was like a virus. Our mindset was always that were weren’t paid enough to do almost anything we would ask, and people were constantly in and out of the company.”

Even if an employee likes working for your business, sometimes money is key. Therefore, you’ll want to think carefully about how you pay your employees. Although it may seem like a weighty cost to increase an employee’s salary, it might actually cost you more if that employee leaves and you have to find and hire someone else.

3. Poor Company Culture

You may think company culture is just another business buzzword, but in fact, it’s a large contributor to how employees feel about their jobs overall. If an employee feels connected to your business and engaged with the whole of your operations, not just their specific responsibilities, they’re more likely to stay at the job and produce the best work. Conversely, of course, poor company culture is another top reason why good employees leave. Poor company culture can consist of a range of issues—from unclear company values to a lack of transparency to simply not providing employees with the tools they need to do their job.

One woman who works in marketing told us: “After a sizable round of layoffs that was handled poorly and resulted in more people quitting in the three months that followed than were laid off, they decided to try to lift staff morale with ‘hot-desking.’ This entailed everyone taking home all personal items—like pictures of your kids—so that people could sit wherever they want. We were asked to clean off our desks on a Friday and everyone was joking that it made quitting that much easier and maybe we should just walk out forever.”

Therefore, it’s important to foster positive company culture, one with a clear mission, long-term plan, and encouragement and support for your employees. Creating a company culture doesn’t necessarily mean you have to tear down your office’s cubicles and start implementing hot-desking, it simply means developing a work environment to positively affect the way an employee learns, performs, and interacts with others.

why good employees quit

4. Feeling Overworked and Underappreciated

We’re all human and we only can give so much. Another reason why good employees quit, therefore, is they feel overworked. Employees may feel like they have too many responsibilities and they have to try and work behind their means to get everything done. Although in many organizations, especially small businesses, you may have to ask your employees to wear many hats, you should always be conscious of what employees have on their plate and how they’re handling their workload.

Ensuring that your employees aren’t overwhelmed may be as simple as meeting with them to discuss their work, help them prioritize their tasks, and encourage them to talk to you when they have a problem. Similarly, feeling underappreciated is another factor as to why employees ultimately leave a job. It may seem like a small thing, but telling employees that they’re doing good work and recognizing their accomplishments goes a long way.

5. Bad Manager 

Unfortunately, having a bad manager can ruin a job for an employee. Many good employees quit their jobs, in fact, because of their manager and not because of the job itself. Whether the manager has little training, is overwhelmed themselves, or simply has a different personality that clashes with the employee, a manager can often make or break an employee’s experience. To prevent this issue, manager training is essential. You want to make sure that your managers have the tools they need to work with and support their employees.

Additionally, you’ll want to make sure that when you hire a manager, that person is actually suited for managing and working with people. Although a senior employee with years of experience might seem like the right person to move into a manager role, not all people will be good managers, and some may not even want to manage. To keep your good employees from leaving your business, therefore, you’ll want to make sure you’re setting them up for success with a competent and experienced manager.

6. No Growth Opportunities 

Even in a small business, employees need the opportunity to grow. It’s hard for anyone to be stuck in the same place for a long period of time—and this is another key reason why good employees quit. If an employee has been doing the same job for years without any opportunity for growth and change, they’re going to seek that growth and change at another organization. Although you may not always be able to offer your employee a clear path for career advancement in your company, there are other ways you can encourage their growth, both personally and professionally.

Some organizations offer fringe benefits, like education stipends, or hold office seminars for employees to gain knowledge on a particular subject or skill. Another significant action you can take is simply having an open conversation about your employee’s future. Ask them what they hope to be doing in five years: What are their goals? What would they like to learn? See how you can work together to promote their growth and let them know that you’re available for honest conversation regarding career progression.

7. Disconnect With Company Values

If you have a business, you likely have a vision for it. The worst way to achieve that vision is by muddling it or by sacrificing overarching values for an end-result. Unfortunately, a reason why good employees quit their jobs is that they don’t connect with their company’s values—or they don’t see the values being implemented in the workplace. 

As one digital media employee said:

“We were ostensibly a news media company, but we chased after anything we could get our hands on that we thought would get views. We wasted all kinds of time posting rumors, live streams to random events, and Twitter beefs instead of focusing on reporting.”

If your employees feel disconnected to your company’s values or, like in this case, that you’re willing to sacrifice them at any given moment, they’re not going to feel compelled to stay in their role. Employees want to understand a business’s mission: What is the business’s ultimate goal? What is everyone doing to reach that goal? What are the values the organization stands for on a day-to-day basis? Instilling consistent values and goals in your employees will give them a sense of purpose, inspiration, and camaraderie—all of which will create an environment (and foster a positive company culture) in which they’re more likely to want to stay.

why good employees quit

8. Team Issues

Cultivating an effective team can be a difficult task—especially as your business is growing and changing. This being said, however, considering the team environment that your employees are working in on a day-to-day basis is an essential part of small business management. Certainly, a reason why good employees quit is that they have problems within their team. Unfortunately, this is a broad reason and there can be many facets within a poor team environment that causes an employee to leave.

Generally, though, employees want to work with like-minded individuals who contribute equally, are professional, and communicate well. If they feel that their team members increasingly don’t fulfill these qualifications, they’re more likely to search for a position with a better team environment. Similarly, if certain employees feel they work harder while other members slack off, this too can create resentment and problems within a team.

Or, team issues can be as straightforward as a lack of diversity. A female on a consistently all-male team may be disheartened by the lack of diversity in her environment and look for a job where she can find a more diverse workplace. To prevent issues within the various teams in your organizations, you’ll want to consider many of the points we’ve discussed thus far. Promoting a healthy work environment, training and hiring the right managers, establishing your company’s values—all of these factors can help foster positive team interactions and growth as well.

9. Poor Leadership 

It’s not only important for your employees to have the right managers, but for them to have good leadership across the wider sphere of the company. Although employees may be satisfied with some facets of their job, if they feel the higher leadership is poor or ineffective, this can greatly affect their willingness to remain in a job. After all, transparency, hard work, and company values start from the top. Employees want to have faith in their leaders and see that they’re working hard to grow the company and foster a positive work environment.

As one former employee of a software startup described, “While the team would work long hours, deal with difficult clients, and struggle to acquire new business, the CEO would travel the world speaking at conferences and having extravagant dinners with other ‘thought leaders’—only to pop in every few weeks to give us a hard time about how things weren’t going well with the company. The company had a huge problem with employee turnover, with more than 30% employee churn each year.”

To prevent your employees from leaving due to these kinds of issues, you’ll not only want to hire competent, experienced leaders but also ensure that your management is working and acting in a way that benefits the organization as a whole.

10. No Work-Life Balance 

Our last reason why good employees quit is perhaps one of the most important. Although people may casually throw around the phrase “work-life balance,” it’s still a significant concept to consider within the context of your business. At the end of the day, therefore, all work-life balance means is that you respect the fact that your employees have lives outside of work.

More than likely, your employees will be more productive, enthusiastic, and engaged when they know that their company trusts them and encourages them to have a life when they leave the office. You don’t want your employees to feel like they have to work 24 hours a day or can’t take a vacation day when they want one. Similarly, although compassion and understanding are not required in these situations, they often go a long way to keeping employees in your organization.

As one former business employee said, “I lost two people close in my life within days of each other, which was obviously upsetting. Rather than providing support they kept questioning when I’d be back in the office, and made me take unpaid days even though I had two funerals to attend within days of each other on two different continents.”

Although this situation might not reflect an everyday occurrence, simply considering the fact that things like this happen in people’s lives and giving your employees the support and freedom to deal with them can make a huge impact.

Reasons Why Good Employees Quit and What Your Business Can Do

As you can see, unfortunately, there are a number of reasons, including these top 10, why good employees quit. At the end of the day, even in the best environments, good employees will leave their current jobs for new opportunities. However, there are ways that you can prevent your employees from quitting due to the reasons we’ve discussed. Ultimately, it boils down to fostering a well-organized and positive work environment.

Although it may not seem like there’s a straight path for creating the environment your employee’s need, your business will be all the better when you try. By recognizing that nothing is perfect, and yet remaining fully engaged in the way your business runs on an interpersonal level, you will be well on your way to keeping good employees at work in your organization.

Eric Goldschein

Eric Goldschein

Eric is the partnerships editor at Fundera with nearly a decade of experience in digital media. He has written for a number of outlets including Business Insider, HuffPost, Men's Journal, BigCommerce, Volusion, Square, RetailNext, and Keap, covering entrepreneurship, finance, marketing, and small business trends. He graduated from the University of Pittsburgh with degrees in history and English writing. Email: eric@fundera.com.
Eric Goldschein

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