What is employee turnover?
It is when another employee replaces one employee.
You can calculate your turnover by taking the annual average number of employees and divide it by the number of departures in a year, then multiplying that number by 100.
Acceptable turnover is 10% or less.
But the average turnover rate in America is 45%.
About 33% of an employee's salary is the cost of replacing an employee.
For highly skilled or long-term employees, this can be as much as 200% of their salary.
So an employee that earns $50,000 a year will cost about $16,500 to replace.
The cost includes training and onboarding, the cost of development, and the cost of having any vacancies within the organization.
Multiply the cost of turnover by the number of employees who leave your organization, and it's easy to see how expensive it is.
It's estimated that employee turnover costs organizations in America a combined amount of over $1 trillion each year.
What's the solution?
Here are some ideas that work:
Get to know your employees. How do they prefer to work? What motivates them? What are their strengths and blind spots?
Hold regular team meetings to bond and communicate as a team. This sense of belonging and togetherness reduces turnover.
Meet regularly with each employee individually. Let them know you value them as an individual.
Use employee engagement surveys to monitor engagement levels. Keep them anonymous. There are many great survey tools out there.
Provide ongoing opportunities for development, and create a development plan with each employee.
Celebrate your people often! Find out what motivates them and customize the celebration.
Provide unique perks at work that speak to your people that you value them highly. Remember, just because you think something is a great perk does not mean that your employees will agree. Get their feedback; feedback creates ownership.
What do you do to build employee engagement?