The formula for measuring employee turnover is:
According to SHRM, the cost of replacing an employee is somewhere between 90 percent and 200 percent of their annual salary; researchers at Columbia University pegged it at 150 percent, depending on the position.According to SHRM, the cost of replacing an employee is somewhere between 90 percent and 200 percent of their annual salary.Click To Tweet
But the true cost of losing an employee is even more expensive than your organization is likely to realize, because the costs are often hidden, delayed or difficult to attribute.
And the costs of turnover go beyond just dollars. They include:
- Lower organizational morale
- Lower organizational engagement
- Lower organizational performance
- Additional training for new employees
- Loss of knowledge retention (aka “tribal knowledge”)
Additionally, if you’re constantly recruiting because of high turnover, you’re stuck in a cycle of hiring instead of engaging and encouraging high performers.
Want the step-by-step on managing employee turnover? Grab your copy of “Managing Employee Turnover” today!
Tell Us What You Think
How do you reduce employee turnover? We want to hear from you. Share your story in the comments.