
A nationwide survey states that about a staggering 80% of employees would leave a job within six months if their expectations weren’t met. Gallup estimates this turnover costs companies a trillion dollars- every year. And you know many of those employees would have been retained only with the effective employee retention strategy.
So, of course, on-the-job training or OTJ increases the employee retention rates . It helps to retain the top talent as the training program keeps the employees engaged and motivated. Moreover, the training improves skills, job satisfaction, and promotes a positive work environment.
Well, that does not cover the whole query- does on-the-job training increase employee retention rates? So, how does on-the-job training correlate with employee retention, or what are the best practices for the OTJ? – comprehensively know it here.
On-the-Job Training: A Key to Employee Retention

Your offered effective on-the-job training motivates employees to stay longer with your company and lower the turnover rates.
The LinkedIn study shows that 30% of employees are happier with their career and development when you offer them on-the-job training than those who do not receive any training in their workplace.
Moreover, LinkedIn’s 2018 Workplace Learning Report shows that 94% of employees will stay in the company longer if the company invests in their career development.
However, here let’s see how the on the job training or the OTJ correlates with the increased employee retention.
1. Relevant Training
When you hire new employees for your company, they need to understand their roles and their contribution to your team. If you offer them on the job training, the employees feel invested in your company and understand their roles.
But without a formal training program, your employee may feel like they are wasting their time in your company and may be willing to check out. Your offered on the job training provides relevant and targeted training to your employees and helps to feel them connected to their roles.
2. Enhanced Morale
A noted point is that if your company has high employee turnover, it comes with significant costs. You know when the turnover is high, potentially higher costs lead to the loss of morale.
If your newly hired employees are coming and resigning in a matter of just a few weeks or months, it creates a negative effect on your company or organization.
Of course, no one wants a company where its employees are constantly changing, the employees are not skilled enough or the employees are working under pressure.
But if you invest in the OTJ program and specialized courses, it will show that your company is dedicated and keeps its hires for the long haul.
3. Increased Satisfaction
You know when you want higher employee retention in your company, higher job satisfaction is the powerful driver. When your employee participates in the OJT program, they are mostly seen to report having a higher job satisfaction level.
The newly joined employees feel more confident in their roles when you provide them with proper training. Ultimately, it leads to increases in job performance and a sense of fulfillment.
Your on-the-job training or OJT offers them a hands-on learning period and enables them to make a difference from day one.
4. A Skilled And Loyal Workforce
Now let’s come to another benefit of on-the-job training for your company or organization. You know your on the job training program not only affects your employees but also your company by building a skilled and loyal workforce.
When you offer on the job training programs to your employees, they learn new skills and knowledge. The training makes them skilled enough to tackle any situation or challenge. No doubt, your well-trained employee will be a positive addition in the way of the success of your company.
As your employees become confident about their skills, they could better support your other employees. Moreover, they can handle challenges together, and you will feel more loyalty towards your company or organization through them.
Study That Links On-The-Job Training With Employee Retention
The study ‘Educational job mismatch, job satisfaction, on-the-job training, and employee quit behavior: A dynamic analytical approach’ is the first to test the impact of on-the-job training on the job retention among job-mismatched employees. It shows that the value of on-the-job training can’t be underestimated.
The study found that over-learned and over-skilled employees are less likely to quit their jobs if the training is available.
The researcher, study co-author and professor of economics, Sholeh Maani, said that only over-education or along with skill under-utilization increases the job resignation incidence from roles. He said it using the unit record data from the Household, Income, and Labour Dynamics in Australia (HILDA) Survey.
However on-the-job training minimized the over-educated and over-skilled employees quitting. He finds that the over-skilled and over-educated employees may stay with their present employers if they have high job satisfaction.
“Australia has a system in which the prevalence of government financial support for training, industry standards requirements and established training providers, facilitate on-the-job training,”
“As such, this study provides other countries with evidence for policy considerations from the Australian case in which on-the-job training receives widespread support and uptake.”
Andrew Lewis, CEO of an online hospitality training platform Allara Global, finds that the study resonates with staffing realities in the hospitality sector.
“From a hospitality industry perspective, the study’s findings hold significant relevance and accuracy. Empowering our employees with knowledge enriches their journey within our industry.
Training and upskilling not only equip them to excel in their roles but also cultivate a strong sense of belonging and enhance job satisfaction. Furthermore, on-the-job training broadens employees’ appreciation and deepens their understanding of the dynamic and rewarding aspects of the hospitality industry.”
Structuring Your OTJ Program: Roles and Responsibilities

Another study by LinkedIn showed that 77% of employers of a company focus on employee experience to increase retention. When they do so, their profit is maximized up to 4x with a high retention rate.
Moreover, it says that 35% of workers are likely to quit if they do not get a raise. The study clearly states the importance of both having a higher retention rate and effective training for your company.
So, let’s have the guidance to create effective on the job training.
1. On The Job Training Goals
First of all, ensure that your OTJ program clearly answers the question, ‘what is actually my OTJ program goal or plan to teach my employees?’
You can get a better answer by working with your partners to understand better what they intend to cover to ensure that your OTJ program complements through related instruction.
2. On The Job Training Types
Now outlines for your OTJ program on how you will conduct the training. You have to choose the type of on-the-job training. Such as you have to choose whether it should be job shadowing, assignment-based project evaluation, mentorship, cohort-based training, or discussion-based training. These are the common ways of leading to employee training.
3. On The Job Training Tracking
Now that your OTJ program is ready, your program should have a system tracking the progress of the training for the employee(s). For this, the employees should know what competencies you are expecting from them to be mastered or how long the training will last.
As an employer, you have to ensure that each employee in the program is making progress toward the completion of your OTJ.
4. On The Job Training Roles
Your employees who are leading the OTJ program or the ones who are participating in the program must know what their roles are in the program.
No matter whether the whole management team of your company or it is a single manager, all participants, trainers, or trainees, you have to offer them a point where they can ask when they have any questions or need any type of progress of your on-the-job training program. Always make yourself available to assist the employee in person, if not possible via phone or email.
FAQs
Now at this point of the discussion, we will cover some of the most common queries and their straightforward answers to get a better idea about the matter. Get going reading.
1. What are the 3 R’s of employee retention?
Rewards, recognition, and respect- these are the major 3 R’s of employee retention. You need to implement each of the 3 R’s for employee retention and to keep the satisfaction high. When you apply these 3 aspects ultimately it will also reduce the turnover.
2. What are the six factors influencing employee retention?
If we go deep down, we notice that 6 factors greatly influence employee retention. They are workplace culture, employee engagement, growth opportunities, flexibility, leadership, and recognition. Your implementation of these six factors will drive better employee retention.
3. What is the HR theory of employee retention?
The HR theory- is an employee relation theory that impacts employee retention. The theory suggests that employee retention will be high when you will offer a strong organizational culture, effective communication, and clear leadership. You have to create a sense of unity to apply the theory.
4. What is the most effective method for managing employee retention?
a number of strategies can help you manage employee retention. Some of these strategies are offering competitive salaries, Recognition and rewards, and building Work-life balance. You can also provide wellness offerings, give other job perks, or offer professional and personal development.
Final Words
In the company or organization, the use of on the job training or OTJ greatly impacts employee retention. Through an on-the-job training program, you provide the employee with the opportunity to learn and develop new skills while they are on the job.
On-the-job training enhances the job satisfaction and engagement of the employee. It, in turn, increases their stay with your company or organization.
You can create more opportunities for your employees by following the 80% – 20% ratio of the on-the-job training. It can be split between the on-site and off-site, where 80% for the on-site training and 20% for the offsite training of the total training period.