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The high cost of post-recession turnover –
and 5 steps you can take to lower it
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With the job market heating up, job-jumping is on the rise. Top performers are usually the first to leave. This churn has a cost. According to human resource experts:
- Employee turnover can cost up to 150% of an employee’s salary.1 At that rate, an 8% turnover rate at a company with 100 employees paid an average of $50,000 a year will result in annual turnover costs of $600,000!
- It costs 16% of pay to replace an employee who earns less than $30,000 and 20% of pay for those earning $30,000 to $50,000. When a highly educated executive leaves, it’s even more painful – 213% of annual salary.2
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Fortunately, there are steps you can take to help lower these costs. A survey conducted by Deloitte Consulting ranks five measures that could discourage turnover. While not necessarily cost-free, they may still offer savings over an excessively high turnover rate.
What would keep you with your current employer?
Source: “Talent Edge 2020: Building the recovery together – What talent expects and how leaders are responding.” Deloitte, April 2011.
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Get expert advice on improving employee relations. With ADP Resource®, a designated ADP® HR Business Partner gives you HR guidance on-site or via the phone.
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This article was condensed from an in-depth write-up in ADP’s BottomLine magazine, offering expert insight into today's most pressing HR management and compliance challenges. Visit the BottomLine home page to download the current and archived issues.
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