How to calculate and improve your attrition rate

It’s a universal truth that people leave organizations.

But knowing your attrition rate is only part of the picture. What matters more is what those departures tell you about who is leaving, where attrition is concentrated, why people are moving on, and what that means for the business.

Every departure represents a person’s experience and a change for those who remain. Looking at the patterns behind the rate can help distinguish healthy workforce movement from motifs that warrant a closer look.

As Stacey Staaterman, CEO of Staaterman Strategic Advisory, puts it: “There is a strong relationship between retention and organizational change… Being curious about the WHYs behind attrition and resistance is job #1—from there, an organization can deploy solutions.”

That context can support better decisions around retention, workforce planning, management, skills, and investment, helping protect capacity, productivity, and critical knowledge.

<< Calculate attrition with this free Excel template >>

Attrition rate key takeaways

• Attrition rate is a starting point, not a diagnosis. The headline number shows how much workforce movement is happening, while segmentation and other workforce data help explain what that movement means.
• Every departure changes the workforce. People leave for many reasons, and each transition can affect workloads, relationships, knowledge, skills, and team capacity.
• Benchmarks provide context, not targets. Compare attrition with relevant peers and historical trends, then look at where departures are concentrated before deciding what action to take.
• Context turns attrition data into action. Looking at patterns across teams, roles, tenure, location, and departure type can help HR focus retention, workforce planning, management, and investment where they matter most.

What is attrition rate?

Attrition tracks the percentage of your workforce that leaves through both voluntary and involuntary departures within whatever window you’re measuring.

On its own, that figure only tells you the volume of change taking place. It doesn’t tell you why people left, where departures are concentrated, or whether there’s a need to take action. Segmentation and other workforce data fill in that context.

Types of attrition

Attrition takes different forms, and each one can point to a different workforce pattern.

• Voluntary attrition. Someone chooses to leave for reasons such as career moves, relocation, education, compensation, entrepreneurship, retirement, or personal circumstances.
• Involuntary attrition. The organization ends someone’s employment, for example, because of restructuring, redundancy, misconduct, or performance concerns.
• Internal attrition. A person moves out of their current role but stays with the organization. It’s related to internal mobility, but can still affect team capacity and succession planning.
• Demographic-specific attrition. Departures are tracked within a particular group, such as by age, gender, ethnicity, tenure, or location. A higher rate can show where to investigate, but not why it’s happening.
• Retirement attrition. People leave the workforce through retirement, which can affect succession planning, knowledge transfer, and future skills needs.
• Functional attrition. Workforce movement reduces a mismatch between current organizational priorities and available roles or skills. It’s best understood in context rather than treated as inherently positive.
• Dysfunctional attrition. The organization loses skills, knowledge, relationships, or talent it would have preferred to retain.

How to calculate your employee attrition rate

To calculate attrition, divide the number of departures in a given period by the average headcount for that period. Then multiply by 100.

Attrition rate = (Number of departures ÷ Average headcount) × 100

You can use this step-by-step method to calculate your attrition rate for any time frame:

1. Choose the period. Measure monthly, quarterly, or annually.
2. Count departures. Include voluntary and involuntary departures.
3. Calculate average headcount. Add the starting and ending headcount, then divide by two.
4. Divide departures by average headcount. This gives you the rate as a decimal.
5. Multiply by 100. This gives you the percentage.

Attrition rate calculation example

Say your company starts Q2 with 500 people. During the quarter:

• 35 people leave
• 20 people join

• Ending headcount = 500 – 35 + 20 = 485
• Average headcount = (500 + 485) ÷ 2 = 492.5
• Attrition rate = (35 ÷ 492.5) × 100 ≈ 7.1 percent

That means around 7.1 percent of the workforce left during Q2.

The calculation gives you the headline rate. Segmenting the result by role, team, tenure, location, or departure type can reveal where the most meaningful patterns are.

<<Answer the question behind your attrition rate with real-time people analytics.>>

Attrition rate calculator

Use this Excel template to calculate attrition across different periods and support workforce planning without manually setting up the formula.

It includes:

• A built-in attrition formula
• Fields for starting headcount, departures, and new hires
• Automatic calculation of average headcount and attrition rate
• Space to track multiple periods side by side

<<Download the calculator to determine your attrition rate.>>

What is a good or average attrition rate?

There is no single “good” attrition rate. Rates vary by industry, role, location, labor market conditions, and departure type. Benchmarks can provide context, but they’re most useful as a starting point rather than a target.

Average workforce separation rates by industry

The United States Bureau of Labor Statistics reports annual averages of monthly total separations rates, including quits, layoffs and discharges, and other separations. These figures measure monthly turnover, not annual attrition, so they’re most helpful as a general point of comparison rather than direct attrition benchmarks or targets.

How to use attrition benchmarks

Use benchmarks to prompt investigation, not as a pass/fail score.

If your attrition rate is 14 percent and a relevant, like-for-like benchmark is 12 percent, the gap alone doesn’t tell you what action to take. 

Instead, ask:

• How has our attrition rate changed over time?
• How do we compare with relevant peers?
• Where is attrition concentrated?
• Which departures create the greatest risk?
• What do exit, engagement, compensation, performance, and manager data tell us?

The cost of attrition

Attrition can create direct costs through recruiting, advertising, onboarding, training, and administration. Indirect costs can include vacancy time, lost productivity, manager time, redistributed workloads, lost institutional knowledge, strained customer relationships, and reduced team capacity.

A simple planning estimate is:

Estimated attrition cost = Number of departures × Average estimated cost per departure

Treat this as an estimate, not an accounting figure. The more useful question is where attrition creates the most business risk or cost. Losing several people from one critical team, for example, may matter more than the same number of departures spread across the organization.

Top causes of high attrition

Attrition data can show you where to look, while other workforce data points help explain what may be happening. The same overall attrition rate can reflect very different underlying experiences, so the next step is to test possible explanations against the evidence you have.

Pay levels

Compensation can contribute to attrition when pay feels unfair, unclear, or out of step with the market.

In Gallup’s 2026 research, pay or benefits was the most commonly cited reason among people looking for a new role. Compare this with compensation data, offer declines, exit feedback, and pay-positioning data.

Growth and development

Limited visibility into career opportunities can affect whether people see a future with the organization.

Gallup also found that growth and advancement were the second-most-cited reasons people were looking for a new job. Internal mobility, in development opportunities, career-path data, and exit feedback can indicate whether progression is part of the pattern.

Company culture

Culture can influence attrition through people’s experience of leadership, trust, inclusion, and collaboration.

In the same Gallup research, 27 percent of dissatisfied job seekers cited leadership or management as a top-three problem. Engagement surveys, manager-level attrition patterns, and qualitative feedback can show where experiences differ.

Stress and workload

Persistent workload pressure can contribute to burnout and attrition. Overtime, absence, engagement, wellbeing, and capacity data can help show whether workload or role design may be affecting particular teams.

How to reduce high attrition

Reducing avoidable attrition starts with understanding where it’s happening and what may be driving it. From there, HR can focus its action where it’s most likely to make a difference. 

• Segment attrition before acting. Break the headline rate down by team, role, tenure, location, and departure type before responding.
• Use stay interviews. Ask what keeps people engaged, where friction exists, and what could make them consider leaving.
• Strengthen career paths and internal mobility. Give people clearer visibility into development, skills growth, and potential next moves.
• Review compensation regularly. Look at fairness, market positioning, transparency, and exit feedback.
• Invest in manager capability. Managers shape feedback, development, workload, trust, and everyday experience.
• Strengthen onboarding and early-tenure support. If first-year attrition is high, examine role clarity, manager support, and early development.
• Build meaningful recognition. Connect recognition to contribution and the value people create.
• Offer flexibility where the work allows. Consider location, hours, working patterns, and employment arrangements.
• Address workload and wellbeing at the source. Look at capacity, role design, expectations, management, and flexibility.
• Use people analytics to spot patterns earlier. Analytics can highlight teams, roles, or groups worth investigating and help identify attrition risk sooner. Decisions still require context, privacy and governance safeguards, and human judgment.

<<See how Bob’s Data & Analytics turns workforce data into decisions.>>

Understand and improve your company’s attrition rate

Attrition rates aren’t an HR report card. Their value lies in helping you understand what workforce movement means for your organization.

By looking at patterns across teams, roles, tenure, location, and departure type, HR can see where to look more closely at attrition and where taking action could make the biggest difference. That might mean strengthening retention strategies in one area, addressing workload or manager challenges in another, or simply recognizing that some movement is healthy and expected.

Turn attrition data into better workforce decisions

Your attrition rate is the beginning of the question, not the answer.

The most useful insight comes from understanding where people are leaving, which departures matter most, and what other workforce data and context reveal. That context can help HR set more focused HR goals, from retention and workforce planning to skills, management, and business resilience.

<<See how a single source of truth turns attrition data into decisions >>

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