Employee onboarding is a crucial process in the journey of any new hire. It's the beginning of a relationship between the employee and the organization. Effective onboarding can lead to higher job satisfaction, better job performance, and a more profound commitment to the organization, ultimately contributing to the overall success and stability of the company.
How a company handles this phase can significantly impact its employees' long-term growth and engagement. A well-designed onboarding process sets the tone for a productive work environment, ensuring new hires feel welcomed and well-informed from day one.
It's an opportunity to integrate employees into the company culture, align them with organizational goals, and equip them with the necessary tools and knowledge to thrive in their new roles. Let's explore some of the statistics related to employee onboarding.
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69% of employees would be more likely to stay with the company for three years or more if they had a positive onboarding experience.3
90% of HR managers recognize the future importance of AI in HR, with 87% committed to incorporating AI in hiring and onboarding processes.5
The onboarding phase is crucial in retention, with 50% of hourly employees quitting within the first 120 days.23
One-to-one interaction with a direct manager is the most important factor during onboarding for 72% of new hires.24
The average cost of hiring an employee is $4,683, rising to over $28,000 for executives.35
Employee Onboarding, Retention and Success Statistics
Employee onboarding is an important factor in retention and success in the workplace. It's the first step in building a solid foundation for long-term employee engagement and productivity.
A well-crafted onboarding experience helps new hires feel valued and prepared and significantly reduces turnover rates. Understanding the importance of effective onboarding is essential for any organization striving for excellence and stability in its workforce.
Nearly half of the employees surveyed believe they can find better jobs with higher pay elsewhere.1
Within their first year, 23% of new hires leave the company.2
69% of employees say they are more likely to stay with a company for at least three years if they have a great onboarding experience.3
The probability that new employees will stay for three years rises by 58% with a structured onboarding program.3
23% of those who quit in the first six months say they would have stayed if they had clear guidelines on their responsibilities.4
41% of HR managers are planning to adopt an automated onboarding process in the next 6-12 months.5
“Employees are a company’s greatest asset – they’re your competitive advantage. You want to attract and retain the best; provide them with encouragement, stimulus, and make them feel that they are an integral part of the company’s mission.” – Anne M. Mulcahy, Former Chairperson and CEO of Xerox Corporation
89% of employees felt well integrated in their new company culture thanks to effective onboarding.6
49% of employees were able to contribute to their team within their first week due to effective onboarding.6
Effective onboarding also leads to 91% of employees feeling a strong connection to their work.6
Employees who experience a highly effective onboarding process are 18 times more likely to show high commitment to their organization.6
The average new hire completes 54 tasks during onboarding.7
The likelihood of a positive onboarding experience increases by 65% when candidates feel respected throughout the hiring processes.8
Daily interactions between leaders and new employees during the first month makes it 3 times more likely that the new employee will be highly satisfied with their onboarding experience.8
86% of hires decide whether to stay or leave their new job within the first six months.9
The Top Reasons Why Employees Leave Companies
Description
Percentage (%)
Career Development
20%
Work-life Balance
12%
Compensation and Benefits
9%
Work Environment
6%
Involuntary
6%
Employee onboarding is vital for workplace success, and businesses are investing more in the process in an effort to retain employees. An effective onboarding journey enhances employee satisfaction and productivity and significantly reduces turnover, benefiting both the organization and its people.
The average turnover rate in an employee’s first month is 35%.10
With an experience-driven onboarding process, organizations can boost new hire retention by 82% and increase productivity by 70%.11
51% of employees would go the extra mile in their work if they had a positive onboarding experience.12
Re-onboarding, the process of repeating early employee training and redefining their goals, can increase employee retention by 43%.12
76% of HR leaders believe that onboarding practices are not sufficiently utilized in their organization.13
Even though 60% of HR leaders believe that integration into the company culture is the top priority during onboarding, culture makes up an average of just 30% of onboarding programs.13
At 37% of organizations, the onboarding process lasts a week or less, compared to 24% of organizations where onboarding takes place over one month.13
The key to a thriving workplace lies in solid employee onboarding. Effective onboarding goes beyond paperwork and company policies; it emphasizes and nurtures integration and a sense of belonging.
But onboarding is not without its hurdles. Next, we'll dive into the tricky parts of onboarding and explore how to tackle them head-on, ensuring your onboarding strategy stays on point.
Statistics on the Challenges of Onboarding
Onboarding shapes the early experiences of new employees. When organizations get it right, it lays the foundations for long-term employee engagement and retention.
However, there are numerous challenges along the way and it requires time and effort from both sides. There’s a lot at stake, with these early days often being decisive in an employee’s commitment to the organization.
New hires typically operate at about 25% productivity in the first month.14
Only 62% of employees in the Americas report a positive onboarding experience.8
88% of companies don't meet the mark with their onboarding processes.15
81% of employees feel overwhelmed by too much information in the onboarding process.16
63% of employees would consider quitting their job within the first two years if they feel that they’re not thriving in the role.16
20% of new hires were unlikely to recommend their employer to friends and family following the onboarding process.17
Following a negative onboarding experience, new hires are twice as likely to start looking for another job.17
22% of employees felt confused during the onboarding process.17
One in six new hires think the systems they work with are not user-friendly.17
40% of HR professionals highlighted the disconnect between hiring and onboarding as a top onboarding challenge.5
Other top onboarding challenges include lack of employee engagement (13%), slow progress (11%), personalization of the new hire experience (11%), and workflow automation (10%).5
The Most Common Onboarding Challenges for Companies
Effective onboarding in the workplace is essential, yet it presents unique challenges, from integrating employees into company culture to providing necessary training. Its growing importance in businesses lies in its ability to enhance employee retention and productivity. A well-implemented onboarding strategy benefits the company and empowers new hires, making them feel valued and equipped for success.
Only 12% of employees strongly agree that their organization is great at onboarding new employees.18
40% of the average onboarding journey is dedicated to paperwork tasks, such as filling in forms and reviewing documentation.19
40% of new hires experience delayed responses to HR-related queries.17
Despite known issues, 10% of companies still haven’t updated their onboarding processes.20
Only 43% of employees had an onboarding process that went further than day one orientation.21
55% of businesses don't evaluate the effectiveness of their onboarding programs.13
60% of companies neglect to set short-term goals for new hires.22
Onboarding plays a crucial role in staff retention, with 50% of hourly workers quitting their job within the first 120 days.23
It can take up to a year or more for employees to really feel comfortable in their job.5
Navigating the challenges of onboarding is crucial for any workplace seeking long-term success. By addressing these issues, companies can create a welcoming and efficient environment for new hires.
The importance of this process is evident: it leads to better employee engagement and satisfaction. In the next section, we will explore the specific processes and benefits of employee onboarding, highlighting how it can be a game-changer for employees and employers.
Employee Onboarding Process and Benefits Statistics
Employee onboarding is a crucial step in building a robust and cohesive workforce. It's about integrating new hires into the company culture and equipping them with the tools and knowledgethey need to thrive.
Effective onboarding boosts employee morale, ensuring a positive work environment. Understanding its importance helps businesses retain top talent and ensures smoother, more successful team development.
72% of employees say that feeling empowered in their role helps them stray engaged and connected.16
76% of employees are happier at work when they are able to find the information they need without needing to ask.16
According to new hires, the most important factors during onboarding are:
One-on-one interaction with their direct manager (72%)
Outlining performance goals (67%)
Having a plan for the first few weeks of the job (57%)
Being introduced to the company culture and values (53%)
Receiving a list of people to meet (52%)24
56% of new hires found that meeting an onboarding buddy just once in their first 90 days helped them become more productive. This figure rises to 97% for those who met their buddy more than eight times.25
90% of HR managers recognize the future importance of automated processes in HR, with 87% committed to implementing AI for hiring and onboarding.5
68% of organizations have already used AI in their recruiting and onboarding processes.5
50% of HR professionals believe AI and automation can improve the onboarding experience.5
Effective employee onboarding streamlines workplace integration, a vital process increasingly embraced by businesses. It boosts productivity and encourages a supportive environment, enhancing job satisfaction and retention.
77% of HR professionals foresee the growing importance of onboarding.27
78% report that their onboarding programs contribute to a positive candidate experience and quicker role proficiency, with 51% of new hires becoming proficient faster.27
Video content can play an important role in onboarding, with 73% of employees preferring to watch a one-minute video over reading an email.28
58% of businesses have supplied hardware for remote onboarding and work.29
Allocating resources to employee training can boost profit margins by 24%, highlighting the significance of incorporating training into onboarding.30
Businesses are two times more inclined to allocate funds towards acquiring talent and enhancing employee experience than in onboarding processes.31
Only 26% of organizations are automating the onboarding process.31
Employee onboarding is vital to boosting performance and loyalty in the workplace. It goes beyond welcoming new hires; it equips them for success. Focusing on onboarding costs, we see that this investment pays off by yielding long-term benefits for the staff and the organization.
Cost of Onboarding Statistics
Understanding the cost of onboarding is imperative for any workplace. It should be seen as an investment in the company’s and its employees’ future. Effective onboarding can significantly enhance productivity and employee retention. Let's explore why smart spending in this area is essential for long-term business health and employee satisfaction.
The average cost and time to hire a new employee are $4,000 and 24 days, respectively.32
Companies spend an average of $1,280 per employee on workplace training.33
The average training cost is $103 per hour per employee, with an average of 32.9 hours spent on learning and development.33
Companies focusing on employee training report a median revenue of $169,100 per employee – twice as much as companies that neglect this area.34
The average cost-per-hire is $4,683, rising to over $28,000 for executive hires.35
The onboarding software market is projected to reach $1.34 billion by 2025.36
Replacing an employee costs between one-half and two times their annual salary.37
In 2023, U.S. small companies spent about $1,100 per employee on training, while large companies spent around $500.39
35% of organizations allocate no budget for onboarding.4
New hires typically require eight months to reach full productivity, during which companies may incur losses.2
Effective onboarding can increase annual revenue by 60%.39
The Average Training Cost Per Employee
Business Size
Average Training Cost per Employee ($)
Small (100-999 Employees)
$1,105
Midsize (1,000-9,999 Employees)
$544
Large (10,000+ Employees)
$477
Other
$702
Onboarding costs are vital for workplace success, representing an investment in employee development and company culture. More businesses recognize its value in boosting long-term productivity and reducing turnover. This strategic spending streamlines team integration and promotes job satisfaction, benefiting both employees and the organization.
The cost of onboarding is a critical investment in the workplace, essential for both the long-term success of employees and the overall health of an organization. Efficient and comprehensive onboarding processes ensure that new hires are well-prepared and aligned with their roles and significantly contribute to employee retention and satisfaction.
This can reduce turnover costs and create a more cohesive, productive work environment. Recognizing and allocating appropriate resources to onboarding demonstrates a company's commitment to its employees' growth and operational excellence, making it a vital aspect of strategic HR management.
Set Employees Up for Success With Onboarding Software
Save time on onboarding admin so you can focus on integrating new hires. With flair, you can create automated onboarding templates tailored to roles, teams, and locations. Whether your workforce is remote or on-site, flair’s onboarding workflows simplify the full range of onboarding tasks: from signing agreements and filling in forms to sharing video guides for the employee’s tasks.
With integrated features for recruiting, inventory management, and performance reviews, flair gives you a complete picture of your new hires in one system. What’s more, our pre-onboarding portal helps you finalize the admin tasks before day one. So there’s nothing stopping you from providing an outstanding onboarding experience that contributes to job satisfaction, employee retention, and productivity.
Frequently Asked Questions
Why is onboarding important for new employees?
Onboarding is important because it helps new hires understand their role, align with company values, and feel welcomed. This can lead to increased job satisfaction, better performance, and longer retention.
What are the key components of an effective onboarding program?
Effective onboarding includes role-specific training, introductions to colleagues and company culture, setting clear expectations, and ongoing support and feedback.
What role do HR departments play in onboarding?
HR departments typically oversee the onboarding process, ensuring compliance with legal requirements, coordinating training and introductions, and monitoring the progress and feedback of new hires.
How does onboarding differ for remote employees?
For remote employees, onboarding often relies more heavily on technology for training and communication. It may also require extra effort to build connections and convey company culture virtually.
What are some common challenges in the onboarding process?
Challenges include managing paperwork, coordinating across departments, ensuring consistent experiences for all new hires, and adapting to remote or hybrid work environments.
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