Control staff turnover

Cost of staff turnover


There are a number of costs associated with staff leaving your employment. The obvious ones are time and money to replace staff and cover workloads, but there are also some hidden costs of high staff turnover.

Staff turnover: monetary and time costs

When a member of staff leaves your employment, there may be costs associated with:

  • leaver administration tasks, eg exit interviews and payroll changes
  • loss of experienced or skilled members of staff
  • covering a vacancy until it's filled, eg through the use of temporary staff or overtime payments
  • advertising for a replacement or using a recruitment agency
  • dealing with recruitment and selection tasks, eg checking applications, and organising and attending interviews
  • the induction and getting new recruits started
  • training and development of new staff

Staff turnover: hidden costs

High staff turnover may result in the following effects across your business:

  • other staff expressing a wish to leave
  • higher levels of stress-related absence as your remaining staff may need to take on the burden of additional workloads
  • missed deadlines or interruptions to workflow
  • a reduction in productivity, levels of customer service or standards of quality
  • a drop in staff morale, particularly if the leaver was popular and good at their job
  • damage to the business reputation that can negatively impact your effectiveness to attract future staff

Rising employee turnover often develops into a 'vicious circle' as low morale causes more workers to leave, which in turn reduces the morale of those who remain, and so on. Taking practical steps to reduce staff turnover will help your business avoid the costs associated with high employee turnover.