Turnover calculation5/25/2023 Here are five ways to reduce employee turnover: 1. It is crucial to monitor the employee turnover rate and to find ways to lower the turnover rate. Ways to Reduce the Employee Turnover Rate In addition to lower existing employee productivity due to a decline in morale, additional productivity is lost as existing employees must teach new employees how to adapt to the organizational culture of the company and the new position. For example, working in the fast-food industry is seen as undesirable due to its notoriously high turnover rates. Brand imageĬompanies with a high employee turnover rate may suffer from an unfavorable public image. Existing employees may face additional stress, resulting in lower productivity. Decline in moraleĪ high employee turnover rate results in an unfavorable effect on the morale of the remaining employees. In addition, there are costs of lost productivity when the employee is attending a training program. When an employee leaves the company, the company incurs costs to find a replacement – recruitment costs, advertising costs, administration costs, background check costs, and testing/interviewing costs. Here are several reasons why a high employee turnover rate is detrimental: 1. Therefore, it is in the best interest of the company to reduce it. To every company, high employee turnover is undesirable and can have a significant adverse impact. The following employee turnover rate figures are provided by CompData Surveys: It should not be compared across industries, as the turnover rate differs significantly in various industries. Therefore, it should be compared to the average within the company’s industry. The employee turnover rate by itself does not provide much insight. Employee Turnover Rate in Various Industries Therefore, Company A saw an employee turnover rate of 2.09% for the month of January. Note: The number of employees separated is three because employee transfers and employees on furlough are not included in the calculation. The January employee turnover rate for Company A would be calculated as follows:
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