Did you know that employee attrition and turnover cost American businesses nearly a trillion dollars every year? To put it in perspective, that's enough money to buy every NFL team in the league — and then some.
The strength of your team depends on how well everyone works together (which is why improving workplace culture is so important) and how well you take care of your team (i.e., the benefits that attract top talent and improve employee retention). When these two important components are missing or lacking, businesses experience high employee turnover and attrition rates.
So, what can you do to reduce the rate of employees leaving? Get ahead of the curve with employee survey questions that predict the potential of employees quitting and take action by partnering with a PEO who can help with retention rates.
What is Employee Attrition?
Employee attrition refers to the natural process of gradually losing employees — including retirement, layoffs/downsizing, resignations, personal reasons like moving, death, etc. — without an immediate need to replace their position.
The cause behind employee attrition is not often malicious or even a result of poor benefits, company culture, or management. It is often due to a company requiring a smaller staff if they have money troubles or simply losing team members to retirement or unavoidable life events.
To calculate employee attrition, you must follow this formula:
(Number of Attritions/Average Number of Employees) X 100 = Attrition Rate)
What is Employee Turnover?
On the other hand, employee turnover refers to positions that must be filled immediately through a rehiring process. Keeping turnover low is an ideal goal considering it's often the result of poor:
- Workplace culture
- Hiring
- Management
- Benefits
- Job development opportunities
Essentially, the employee left because they were not happy with your company or felt like they weren't reaching their full potential in the position and decided to move on to something better. To calculate employee turnover rate, you need to follow this formula:
(Employees That Left/Average Number of Employees) X 100 = Employee Turnover Rate)
Here's Why Employee Surveys are So Valuable
When gauging the level of engagement and fulfillment your employees have, survey questions can add a lot of valuable insight. During the pandemic and times of uncertainty, in particular, it's important to know how your employees are feeling. Not only will these questions help you improve your workplace culture, morale, training, and more, but they will also make employees feel more appreciated when you check in on them.
In fact, research shows that the average employee survey receives a range of 65% to 85% participation, with most employees appreciating the intent on checking in and considering their feedback for improvements.
For instance, these questions can be given in a survey with a scale from 1 (highly unlikely) to 10 (highly likely), yes or no answers, or fill-in-the-blank:
- On a scale of 1 to 10, how satisfied are you in your current role?
- On a scale of 1 to 10, how likely is it that you will still be working here in the next year?
- What is the likelihood that you would refer a friend or acquaintance to work here?
- If you were to give notice within the next 12 months, what would your main reason be?
- Have you interviewed with another company in the last three months?
- In the previous three months, have you considered quitting your job?
- How likely is it that you would recommend working here to a friend or family member?
- Knowing what you know about working here, what is the likelihood that you would reapply here again?
- Have you considered finding another place of employment?
- If you received another job offer, what is the probability that you would accept?
Partnering with a PEO to Reduce Employee Attrition and Turnover
The impact of employee attrition and turnover on your bottom line is unmistakable. Rehiring costs can cost you on average 50-60% of the original employee's salary, with training alone costing more than $1,500 per employee. It's more cost-efficient to take care of existing talent and make more informed hiring decisions.
After all, a business that isn't focusing on employee satisfaction and engagement will not score well in attrition and turnover rates. Utilizing survey questions and regular reviews (exit reviews, in particular) will allow you to identify where to improve and how to make your employees happier.
This is where the benefits of working with a PEO like PRO Resources can make all the difference.
Our team of experts works closely with your team to identify weaknesses and build on strengths within your staff and work environment. More often than not, your team is just too overwhelmed with work to tend to employee needs.
By partnering with us, you will gain access to better benefits, payroll processes, retirement plans, HR compliance, and more. Contact us for more insight into reducing employee attrition and turnover with the help of a trusted PEO.
