Business 101 April 18, 2026

How to Retain Employees in 2026

The Philippines recorded a 20% employee attrition rate in 2025, marking the highest turnover rate in Southeast Asia. To stop losing talent, local businesses must rethink their workplace culture and employee experience.

The Philippines had the highest employee turnover rate in Southeast Asia in 2025, according to a study by the British-American consulting firm Aon. The 2025 study reports that the country had a 20% attrition rate last year, higher than the regional average of 17.5%.

64% of Filipino workers are “either in the process of moving between employers or might/will seek new employment in the next 12 months,” reports another 2025 Aon study on employee sentiment.

Constant employee turnover impedes business growth, as employers spend resources filling positions that may be vacant again in a few months.

Businesses also lose days of productivity when an employee resigns and leaders look for a replacement. Between recruitment, onboarding, and training, a business loses about 100 days of productivity, according to data from Drake International.

Given the high costs of employee resignations, Filipino entrepreneurs should develop strategies to ensure their workforce not only remains in their roles but is also empowered to grow professionally within and alongside the organization.

Crissy Rollan, a veteran human resources (HR) practitioner who helped build workforces and work cultures at GoTyme and Growsari, spoke with The Business Manual in a March 17 interview to share her insights and advice on retaining employees.

What is Employee Retention and Why Does it Matter?

Employee retention can be defined as an organization’s ability to keep its employees and reduce turnover.

It’s not only about having retention rates lower than the industry average, said Rollan, who is currently the founder, CEO, and managing director of HR service firm Qubel Group.

Take note of productivity as well, she said.

“How do you build your organization to be a place where people choose to stay with you happily?” asked Rollan.

“Employee retention is about retaining the people, but also making sure that the people that are staying are the right people, and they’re happily producing and contributing to the company.”

Top Reasons Why Filipino Workers Resign Today

Two out of three Filipino employees are attracted to companies that offer “better than average pay and meaningful benefits,” Aon’s 2025 employee sentiment report found.

Better compensation is the main reason workers leave their jobs, based on Rollan’s conversations with workers.

More workers also seek remote and hybrid work, a trend that accelerated during the COVID-19 pandemic.

“Balancing rising compensation costs with the need for agility is key. The most successful firms are leveraging real-time market data and total rewards strategies to stay ahead,” Aon’s Southeast Asia head of talent solutions Rahul Chawla noted in the firm's turnover survey.

The employee sentiment report by Aon lists the top five valued benefits among Filipino workers as follows:

Medical coverage
Paid time off
Work-life balance programs
Career development
Retirement savings

The top five employee expectations, moreover, are:

Wellbeing support (70%)
Emergency fund assistance (66%)
Retirement savings assistance (65%)
Access to financial education (58%)
Access to financial guidance (55%)

An HR Expert's Tips On Employee Retention

At a time when organizations compete with local and foreign companies that offer better pay and provide resources to improve work culture, leaders should consider the following ways to incorporate into their retention strategies.

Tip # 1: Clarify the Manager's Role to Reduce Turnover

47% of surveyed employees who resigned said they “loved their job, but not their manager,” said another 2025 study, this time by HR information system provider BambooHR.

57% said management style was the main reason they quit; 45% said good working relationships with their manager were important in their decision to stay.

Rollan believes that an employee may leave their job because their manager fails to set clear expectations.

“A lot of times, when people say that employees leave their managers, it’s often misunderstood," Rollan said. "It’s the lack of clarity that makes them so agitated and puts them in a place where [they] don’t know what’s gonna happen next."

Because of the complexity of managerial work, which involves dealing with people and their emotions while still delivering results for the team, organizations should recognize that not everyone is meant to be a manager.

Frequently Asked Questions

Why does the Philippines struggle with the highest employee attrition rate in Southeast Asia?

The Philippines recorded a 20% attrition rate in 2025 due to a combination of stagnant compensation and a lack of workplace flexibility. While the regional average sits at 17.5%, two out of three Filipino workers are actively seeking better pay and meaningful benefits, such as medical coverage and work-life balance programs. This high turnover costs businesses roughly 100 days of productivity per resignation, making retention a critical financial priority.

How does a manager’s lack of clarity contribute to high employee turnover?

Nearly half of employees who resign cite their manager as the primary reason, often due to a lack of clear expectations and transparent communication. When leadership fails to define roles or provide co-accountability, employees become "agitated" and uncertain about their professional future. Organizations must recognize that technical performance does not equate to managerial capability and should provide specific leadership training to establish trust.

What is "Workplace Friction" and how can leaders proactively audit it?

Workplace friction refers to daily drains on employee energy, such as approval bottlenecks, fire drills, and unclear ownership of tasks. HR experts suggest that leaders must "pre-empt" losses by identifying where systems fail before an employee reaches the point of resignation. By implementing systems that remove these hurdles, companies can restore employee energy and improve the overall day-to-day work experience.

How should organizations redefine career growth for a multi-generational workforce?

Growth is no longer a linear climb; it must be tailored to an individual’s life stage, from Gen Z’s desire for purposeful work to a parent’s need for flexibility. Modern retention strategies include internal career paths, capacity-building opportunities, and positive work environments that allow employees to align their roles with personal priorities. Providing this autonomy helps retain talent that might otherwise leave for roles with higher fulfillment rather than just higher pay.

Why should businesses treat their employees like customers to improve retention?

Treating employees like customers means viewing the entire "employee experience"—from recruitment to offboarding—as a journey that requires constant optimization. This shift in mindset forces leadership to introspect on whether they are providing enough value and support to earn an employee's loyalty daily. Improving this journey often requires more time and effort than financial investment, focusing on building consistent, top-down trust.

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