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Why Onboarding Affects Retention (And What to Do About It)

Hiring

4 min read

You’ve worked hard to find the right person for the job. You’ve invested time in interviews, reference checks, and paperwork. Then—three months later—they leave.

Sound familiar?

For small and midsize businesses, turnover is expensive and exhausting. But one of the most overlooked solutions to long-term retention is one of the first experiences a new hire has: onboarding.

The quality of your onboarding process directly affects how long employees stay, how well they perform, and how committed they feel to your company. Let’s break down why onboarding matters more than you might think—and how you can make simple changes that lead to long-term success.

First Impressions Are Lasting Ones

Your onboarding process sets the tone for an employee’s entire experience with your business. It communicates more than just policies and procedures—it shows how much you care.

If onboarding is disorganized, inconsistent, or rushed, new hires are left wondering:

  • Did I make the right decision?

  • Am I set up to succeed here?

  • Does this company have it together?

On the flip side, when onboarding is thoughtful and structured, employees feel confident and supported from the start—which builds the trust and clarity they need to stick around.

The Link Between Onboarding and Retention

According to multiple studies, most new employees decide whether they’ll stay with a company within the first 90 days. And nearly one-third of new hires leave within the first year—often citing confusion, lack of training, or culture misalignment as key reasons.

Strong onboarding helps prevent this by:

  • Clarifying expectations from day one

  • Providing the tools and information needed to succeed

  • Connecting new hires to their team and manager

  • Reinforcing company values and culture early on

In other words, good onboarding reduces early turnover by eliminating uncertainty—and increasing engagement.

What Happens When Onboarding Falls Short

Even if your intentions are good, a weak or inconsistent onboarding experience can lead to real damage:

Employees feel lost. Without a clear roadmap, new hires can quickly become overwhelmed, unsure of who to ask for help or how to contribute.

Managers get frustrated. When employees aren’t properly trained or equipped, managers spend more time troubleshooting and less time developing talent.

Morale drops. When new hires don’t feel integrated, it creates friction with existing team members and can drag down productivity.

Turnover increases. When employees don’t feel supported early on, they’re more likely to look elsewhere—costing you time, money, and momentum.

How to Strengthen Your Onboarding Process

You don’t need a massive HR department to improve onboarding. You just need a consistent process that supports people from day one.

Here are a few areas to focus on:

1. Structure the First 30 Days
 Create a checklist that covers everything from technology setup to policy review to role-specific training. Give managers and employees a clear plan to follow.

2. Assign a Buddy or Mentor
 Pair new hires with a peer who can answer questions and help them adjust socially and professionally. This accelerates relationship-building and reduces isolation.

3. Set Clear Expectations Early
 Don’t wait for the 90-day review. Use weekly 1:1 check-ins to set goals, offer feedback, and track progress in real time.

4. Introduce Company Culture with Intention
 Share your values, mission, and what “great work” looks like at your company. Don’t assume culture is absorbed—make it part of onboarding.

5. Streamline HR and Payroll Tasks
 Delays in things like direct deposit setup, time tracking, or benefits enrollment can create unnecessary stress. Use a connected system like CadenceHCM to ensure a smooth and timely setup.

Final Thoughts: Onboarding Isn’t Extra—It’s Essential

Hiring is expensive. Losing great people early is even more expensive.

Onboarding isn’t just a new hire formality—it’s the foundation of long-term retention. When done right, it builds trust, reduces ramp-up time, and helps employees feel like a valued part of your team from day one.

At CadenceHCM, we help businesses like yours create onboarding processes that are easy to follow, legally sound, and built to grow with your team.

Notice: This generic information is not intended to be taken as tax, legal, benefits, financial, or HR advice. Since rules and regulations change over time and can vary (by industry, entity type, and locale), consult your accountant, lawyer, and/or HR expert for specific guidance.
Scott Patterson

Scott Patterson

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