Employee turnover

What Is Employee Turnover?
Employee turnover refers to the rate at which workers leave an organization within a specific timeframe. This turnover can be voluntary, when employees resign by choice, or involuntary, when departures are the result of dismissals, layoffs, or other employer-driven decisions.

Types of Employee Turnover

1. Voluntary Turnover:
   This occurs when employees choose to leave on their own. Common reasons include accepting a better job offer, pursuing further education, relocating, or making a career change. In some cases, individuals may resign without having another position lined up, simply to explore new opportunities.
2. Involuntary Turnover:
   This type happens when an employee is let go due to reasons such as poor job performance, misconduct, failing background checks, or redundancy. It can also be caused by external factors like economic downturns, restructuring, or loss of market share to competitors.

Common Reasons Employees Leave

Several factors contribute to high turnover rates, such as:

• Uncompetitive pay: Employees often leave when they believe their compensation doesn’t match their skills or industry standards.
• Lack of engagement: Workers who don’t feel connected to their roles or the company’s mission may seek more meaningful work elsewhere.
• Burnout: Excessive workloads, limited resources, or unrealistic expectations can lead to exhaustion and, ultimately, resignation.
• Insufficient recognition: When employees don’t receive feedback or acknowledgment for their work, they may feel undervalued and consider leaving.

Can Turnover Be a Positive Thing?
While high turnover is usually seen as a negative, it can sometimes be beneficial. For instance, when a low-performing employee leaves, it creates an opportunity to bring in someone more aligned with the role. In some cases, turnover can highlight weaknesses in your hiring process, onboarding, or culture, giving you a chance to make needed improvements.

How to Lower Employee Turnover

Reducing turnover starts with understanding why employees leave and taking action to address it. Here are several strategies:

• Benchmark against competitors: Review what similar businesses offer in terms of salary, benefits, and perks. Tools like Beyond can help analyze compensation trends and HR data.
• Gather employee input: Use regular performance reviews, surveys, and exit interviews to collect honest feedback about your workplace environment.
• Implement changes based on feedback: Whether it’s improving work-life balance, offering flexible scheduling, or adjusting policies, employees need to see that their input leads to action.

Calculating Your Turnover Rate

To determine your employee turnover rate, use this simple formula:

1. Find the number of employees who left during a set period (quarter or year).
2. Divide that number by the average total number of employees during the same period.
3. Multiply the result by 100 to express it as a percentage.

Turnover Rate = (Departures ÷ Average Employee Count) × 100

This calculation can help you track workforce trends and evaluate whether your retention efforts are working over time.