What is attrition?
Simply put, turnover is the number of employees who leave your company and must be replaced within a certain period of time. You can have high or low employee turnover. We talk about low employee turnover when a small number of employees leave your company within a certain period of time. High employee turnover means that a large number of employees leave your company within a given time. Measuring employee turnover can provide many insights. For example, what the costs are.
When do you have high or low employee turnover?
Unfortunately, there is no magic percentage that indicates when you have high or low employee turnover. To find out if your turnover rate is too high or low, the easiest way is to compare your average with the average of other organizations working in the same industry. In the Netherlands, the average is around 17%. Are you way above this? Then you probably have too high a turnover rate.
Is it bad to have high or low employee turnover?
There is nothing wrong with low employee turnover. In fact, it can be very good when few people leave your company. That's how you keep the knowledge inside. A high turnover, however, can be detrimental to your organization. However, it is important to look at who is leaving the organization for what reason. After all, it does not always mean that your organization is not a nice place to work. For example, employees may also retire, travel or change careers. In these cases, there's not much you can do about it. It is a bigger problem when valuable employees leave the organization, for example, because they go to work for a competitor or because they are unhappy in the workplace.
Why can high turnover be a problem?
Replacing employees can be expensive. While costs vary by organization and employee, several studies have shown that these costs can be as high as 60% of the old employee's salary. Moreover, the total cost of replacement, including training and lost production, can range from 90% to 200% of an employee's annual salary. In addition, employees who do remain with the company are less productive because they have to take on the responsibilities of open positions.
What are the main reasons for employee turnover?
The main reasons workers give for quitting a job are:
- Lack of advancement opportunities
- Poor management
- Lack of organizational fit
- Lack of training, support or resources needed to do their jobs well
How do you reduce attrition?
High turnover is costly. In addition, it has a negative effect on the people who do stay. The more often you see colleagues leave, the sooner you will ask yourself whether this is still the right organization for you. If you want to retain good people, take the following steps:
- Select people who fit with you
In your selection process, first look to see if people fit your organization's culture. If so, then look at other selection criteria. That way you avoid a mismatch based on different 'DNAs': the core values and norms. - Make development paths clear
Development and growth are important for employees. And often those opportunities exist internally, but are not clear. So make sure people gain insight into their own competenciesthat others can find them on those competencies, and that it is clear how they can further utilize those competencies in the organization. In other words, offer them growth perspective. - Appreciate your people
Show appreciation when employees do something well. Show that you appreciate their work. That's how you create a positive work environment. - Listen to your people
Be open to the experiences and suggestions of your people. With a pulse survey from Treams you can put the thermometer in your organization and ask anonymous questions about what is really going on in your organization. Get an impression of whether people feel free to speak out. Psychological safety is an important condition for satisfaction, commitment and growth.
Treams' growth platform gives you all the tools you need to get started right away. Easily accessible and interwoven with everyday practice!