What is employee turnover?

Employee turnover is an HR metric that measures the rate at which people leave their jobs, voluntarily or involuntarily, during a specific period of time.

How can we calculate the employee turnover rate?

Employee turnover is an easy HR metric to calculate. Simply divide the total number of employees by the number of departures at your organization during the period.

Why should HR leaders care about turnover?

An excessively high turnover rate means that people are leaving in droves. It’s usually a sign that people aren’t happy with something (or many things) at work. Moreover, the departure of so many skilled professionals can weaken morale and burden the company with significant recruitment and training costs.

What is a healthy employee turnover rate?

There isn’t a one-size-fits-all healthy turnover rate. It depends on the industry, the size of the company, and economic and social factors. Following COVID-19’s disruption of the economy, for example, the nursing-home worker turnover rate rose to a detrimental 94 percent while the tech industry benefited from a lower rate of 18.3 percent.

What is the cost of turnover?

Turnover per employee can cost from one-half to twice a person’s annual salary. Its cost involves the time, effort, and money a company invests in recruiting, onboarding, hiring, and training people. Not to mention, job vacancies also lead to lost productivity.

Who is responsible for employee turnover?

HR is responsible for helping the organization better understand what their people want and how to deliver it.

Why should lowering turnover be part of the modern HR strategy?

Turnover rates indicate a company’s internal state of health and its ability to retain talent. By approaching turnover with intentional, strategic planning, HR professionals can build an engaged workforce, improve the bottom line, and boost the company brand.