Staff turnover, or simply called employee turnover, is the number of employees who leave the company and need to be replaced within a certain period of time. Also read our article “what is turnover rate” on how to calculate staff turnover.

Table of contents of this article

What does staff turnover tell about a company?

Staff turnover should be viewed in context, as certain industries, such as hospitality and retail, traditionally have higher than average staff turnover. Therefore, a company should compare its employee turnover with similar companies in the industry to get an idea of how well one is retaining talent

Is there an ideal rate of staff turnover? 

There is no magic percentage that indicates low employee turnover. But comparing employee turnover with the Dutch average and the sector in which you operate is a good start. Average employee turnover in the Netherlands is about 17% per year. 

Is staff turnover undesirable?

There is nothing wrong with low staff turnover. In fact, when a small number of employees leave, it can be beneficial because it brings in new people who are bursting with enthusiasm and fresh ideas. It is especially important to look at who is leaving the company. Valuable employees leaving the company have a greater impact than when unproductive personnel leave

High employee turnover does not necessarily mean the company is a terrible place to work. Employees may retire, travel or change career paths. In that case, there’s not much you as an organization can do about these leavers

Staff turnover and offboarding

Offboarding is crucial in staff turnover, especially if you are losing valuable employees to a competitor or because they are unhappy at work. Organize exit interviews to understand why they are leaving. Translate that into a plan to encourage staff to stay. Every time an employee leaves the company, an investment must be made in hiring and training a new employee, and it takes an average of three months for someone to become fully productive. 

What is the ideal staff turnover rate?

Ten percent or less is a generally accepted turnover rate that should be met in any industry. But a “good” attrition rate depends on the company and its retention goals. Again, it is important to look at the average employee turnover rate in the industry. For example, a clothing store often employs a lot of young staff. Young employees tend to stay until they go to college or get another job, which may be why this industry has a relatively high employee turnover rate

If your employee turnover rate is higher than the industry average, it’s important to consider why. But don’t get too hung up on the numbers. Low turnover compared to industry standards seems great at first glance, but what if it’s only the best employees who are leaving? To avoid making assumptions and overlooking areas for improvement, consider the context of turnover

What is the most important reason that employees leave?

Several research shows that the main reasons employees leave are:

1. 1. Poor pay
      Compensation and fringe benefits are incredibly important to employees.
   2. Lack of career opportunities
      Another major reason why employees leave is the lack of career opportunities. Employees want to learn, grow and develop. They want to be able to see a future with the organization. 
   3. Feeling disrespected at work 
      This is an interesting topic, but a top reason why employees (especially many women) leave their jobs.
   4. Child care problems
      The pandemic also led to a crisis in child care. Suddenly, working parents became teachers, nannies, counselors, nurses and workers — all rolled into one. The pandemic exposed cracks in the industry regarding working parents and child care providers. Many workers need better options. 
   5. Not enough flexibility 
      Some employers have fully embraced hybrid or remote work environments, where others stick to the office environment. 87% of employees want some flexibility. 
   6. Difficult work-life balance 
      The pandemic mixed work and personal life into one big mush. People continued to work late from kitchen tables and couches. Like flexibility, employees want to be able to find harmony between their work and personal lives. 
   7. Burnout 
      Burnout is on the rise and employee well-being is stagnating. When employees have reached the end of their fuel tanks at an organization, they are likely to seek better opportunities elsewhere. 
   8. A bad manager 
      Employees are leaving managers, not companies. 57% of employees leave their jobs because of their boss 
   9. Finding a new purpose 
      A lack of purpose in work may be another reason workers found new jobs. Especially during the pandemic, workers revisited and reevaluated their priorities. 
   10. Company culture 
       Finally, company culture. Culture plays a big role in the employee experience. And if a toxic corporate culture affects an employee’s experience, it’s a major reason for leaving. 

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Staff turnover and onboarding

Focus attention on retaining loyal, hard-working employees. And realize that the likelihood of employees staying long depends largely on the first few weeks. When employees feel connected to the culture of their workplace, employee engagement increases. So invest in good pre- and onboarding, for example, with ENBOQ. 

Want more informative articles from ENBOQ such as:
What is Onboarding
What is Gamification