Wow. 75% of all employees are looking to change jobs before the end of the year. The cost to interview, train, and manage an new employee is approximately 70% of that employee's salary (if they earn $50,000 per year, then it costs you - the employer - about $35,000 extra!
This is a good article on the basics of retaining employees. Remember - the single most important reason an employee stays with a company is if they're happy. That should be of paramount importance to you and your managers.