Employee turnover is the rate at which employees leave a company. The cost of a single departure tends to be underestimated, because only recruitment is counted. The real figure includes the time the manager and team spend on selection, any fee paid to a recruitment agency, the period when the position is unfilled and others cover the work, onboarding and lower output during the ramp-up period, the loss of knowledge and customer relationships, and the impact on team morale. For more specialised positions, this amounts to several times the monthly salary. Measure turnover separately for the first year and for longer-tenured employees, because the causes differ – in the first case it is most often a mismatch with expectations set during recruitment and weak onboarding, in the second a lack of growth and the relationship with the direct manager.
See also: Employee onboarding, Exit interview, Customer retention.
