#TURNOVER DEFINITION HOW TO#

Turnover measures how many employees are leaving the company and tries to determine the reasons for their resignations. Retention measures how long employees remain with the company and includes strategies for keeping valuable employees.

While retention and turnover are closely related, they focus on opposite trends in a company's staffing. Many companies measure turnover more frequently, often on a monthly basis, although they may do annual turnover calculations. Retention is often a long-term metric that businesses calculate annually. One important difference between retention and turnover is the time frame companies use to calculate them. These are some ways retention and turnover differ: Time frame Although companies often use these two metrics together, there are several important differences between them. Retention and turnover are related measurements businesses that use to gauge their employees' engagement and satisfaction with their company. Read more: 10 Benefits of Employee Retention Differences between retention vs. The ability to attract new staff can help a company innovate and expand its operations. Businesses that attract good employees with the right skill sets may deliver their products and services more effectively and gain customer support and loyalty. These two factors can also affect a company's ability to perform its core mission. Monitoring retention and turnover might also help businesses save money since it's often cheaper to keep employees than to hire and train new ones. Ensuring low turnover can allow businesses to create a stable work environment for their employees and allow staff to create reliable working relationships. High retention and low turnover may show business leaders and managers that their hiring processes are effective and that they have high employee satisfaction. Retention and turnover can help companies understand how their employees feel about working with them. Why are retention and turnover important? Companies may consider this a type of turnover and monitor employees' reasons for transferring. Transfers: Internal transfers occur when an employee moves from one department to another. While retirement can increase hiring costs and decrease productivity, it rarely shows retention issues in a company. Retirement: Some businesses consider retirement a type of turnover. It's often important to track and prevent this type of turnover to retain valuable staff members. Regrettable turnover: Regrettable turnover occurs when a company loses an important employee on its team. This may occur at the end of certain projects or development phases. Healthy turnover: Healthy turnover refers to a situation in which a company and an employee benefit from a resignation. It may be helpful for managers to develop strategies to prevent similar resignations. Involuntary turnover: Involuntary turnover happens when a company ends a staff member's employment because of staff reductions or performance issues.Īvoidable turnover: Avoidable turnover occurs when employees leave voluntarily for preventable reasons. Voluntary turnover: This type of turnover occurs when an employee leaves a company by choice, either for new opportunities or because of dissatisfaction with their employment. Here are some types of turnover a company may experience: Analysts usually express turnover as a percentage of the total number of employees who leave during a certain time frame, typically a month or a year. Turnover is a measure of how many employees leave a company. Read more: Definition of Employee Retention What is turnover?

Retention strategies can include increased opportunities for advancement, salary raises, improved work environments or team-building exercises. Retention often includes strategies for keeping employees working for a company. Companies usually measure retention over a specific period of time, usually a year. Retention is a measurement that tells companies the rate at which their employees stay with them.

#TURNOVER DEFINITION HOW TO#

Related: How To Calculate Employee Turnover What is retention? In this article, we define retention and turnover, explain how they differ, show how to calculate them and offer tips to use these concepts in your company. If you work in management or human resources, understanding these concepts can help you optimize your staff and create a healthy work environment that prioritizes your employees. They can help companies understand the satisfaction of their workforce and evaluate the strength of their company culture. Retention and turnover are two important concepts for analyzing the relationship between businesses and employees.

Turnover definition