Since the Great Resignation, salary and benefits are no longer enough to retain top talent. Employees are more tempted than ever by new opportunities and this threatens the stability of your company with an escalating turnover rate.
Don’t overlook the importance of calculating your employee turnover rate! Ignoring this factor can lead to disastrous consequences such as exorbitant recruiting costs, decreased productivity and a compromised brand reputation. Act now to avoid these consequences and ensure the satisfaction and stability of your staff!
Imagine your company is a turnstile at the entrance to an amusement park. Each person who exits the turnstile represents an employee who leaves your company. The number of people entering the park represents the number of employees you hire. The turnover rate measures how often people leave the park and need to be replaced by new people. Similarly, the employee turnover rate measures how often employees leave your company and need to be replaced. In the case of your business, you don’t want the turnstile to keep spinning or your turnover rate may make you dizzy!
To avoid headaches, you need to know how to perform the employee turnover rate formula to calculate your employee turnover rate is essential to maintaining a stable and efficient workforce! Without further ado, here’s the employee turnover rate formula and how to calculate it in 4 simple steps:
Choosing the time frame in your employee turnover rate formula is necessary to get an accurate analysis of the stability of your workforce. Do you want to monitor long-term trends? If so, choose a long period, such as a full year. Do you prefer a detailed, short-term view? If the answer is yes, measure your turnover rate over a quarter. Whatever you choose, be sure to compare the data consistently for a reliable and rewarding analysis!
To do your employee turnover rate formula, you only need to know how many employees were there at the beginning and end of the period you have chosen. This information will give you a clear and accurate picture of your employee turnover and the percentage of employees replaced. Knowing your employee turnover rate will help you make the right decisions to improve the satisfaction and performance of your workforce!
Determining the number of departures during a given period is very simple! To do so, you simply calculate the difference between the number of employees at the beginning of the period and the number of employees at the end of the period.
Let’s say you have 100 employees at the beginning of the period, and 95 at the end of the period. The number of departures would then be 100 – 95 = 5. This number will be important in the employee turnover rate formula.
Now, to determine the employee turnover rate, you divide this number of departures (5) by the number of employees at the beginning of the period (100) and then multiply by 100 to get the percentage.
In our example, the employee turnover rate formula would be 5/100 x 100 = 5%.
There you go, by following this simple formula, you can calculate your employee turnover rate!
Now that you know your turnover percentage, thanks to the employee turnover rate formula, you need to interpret the results to make informed decisions to decrease it. Make the right decisions to retain your talented employees and create an enviable work culture.
High turnover rate
A high turnover can be a sign of significant problems for your company. Causes can include unsatisfactory working conditions, lack of opportunity for employees, poor staff management, inadequate wages, or lack of training and development.
The consequences of high turnover can include additional costs associated with recruiting and training new employees, reduced quality of work, poor brand image, and decreased motivation for the remaining employees.
Low turnover rate
A low turnover rate can be a sign that employees are satisfied with their jobs and that the company has a supportive work culture. Causes can include competitive salaries, benefits, interesting opportunities, good staff management and a positive work environment. A low rate can reduce the cost of recruiting and training new employees, improve the quality of work, enhance your company’s brand and increase employee motivation.
What conclusions to draw from your turnover rate
Employee turnover rate is a key indicator of your company’s performance in managing employees. Regular analysis of this rate can help your company identify potential problems and take action to improve employee satisfaction and performance. Doing the employee turnover rate formula allows you to conclude about the work culture you offer, the quality of the work environment you provide to your staff and the opportunities you offer to your employees.
Employee turnover can be a nightmare for your company! It can result in significant costs to find, hire and train new hires, not to mention the additional costs associated with lower quality of work and productivity. In addition, turnover has a significant impact on the organizational culture and the satisfaction of remaining employees. They risk losing their motivation and commitment which will lead them to start looking for another job.
If you don’t master the employee turnover rate formula and do nothing to decrease the turnover rate within your company, it could quickly become a vicious spiral from which it will be difficult to escape!
To help you, here are some ways to decrease your employee turnover rate:
Combining these ideas with the results of your turnover rate calculation will allow you to target your improvement opportunities. This will allow you to offer the best conditions to your workforce, which will decrease your employee turnover rate. This way, you will be pleased with the results that the employee turnover rate formula brings you!
Are you discouraged by the results of your employee turnover calculation? Are you looking for a foolproof solution to remedy the situation? If so, InputKit’s employee experience software is the right tool for you! It allows you to get concrete and honest feedback from your employees on their job satisfaction. With metrics such as the employee satisfaction score, the engagement rate and many employee satisfaction scores for different aspects of their work, you can target areas that need improvement and implement actions to improve their work experience. With our solution, you can strengthen employee retention and build a strong corporate culture that will decrease your turnover rate!
How do you retain your top talent with the employee turnover rate formula? Follow our tips to make sure you have everything you need to maximize your employee retention
To do the employee turnover rate formula, you must first determine a time frame for your analysis. Next, you need to determine the number of employees at the beginning and end of that period. Once you have determined this, you need to calculate the number of departures during the period and divide the number of departures by the number of employees at the beginning of the period. Multiply this result by 100 and you have your results for your employee turnover rate formula!
Once you have completed the employee turnover rate formula, you need to interpret the results. If your rate is high, you need to review the working conditions, training and professional development opportunities and the staff management you offer your employees. Evaluating employee satisfaction, implementing a recognition program and providing a positive work environment are excellent ways to help you reduce your turnover rate.
Do you need assistance in improving your employee retention and reducing your employee turnover rate? If so, schedule your free, no-commitment demo of our solution now! Our experts will be happy to help you improve the employee experience within your company.
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