The Bureau of Labor Statistics reports that the annual total separation/turnover rates in 2020 was 57.3%. You may look at this number and think you’re doing great. But before you pat yourself on the back, realize that calculating turnover actually is more complicated.
There are three things to consider as you establish turnover and rate guidelines for your company:
- Measure the right metrics. You need to consider how much turnover is voluntary versus involuntary and how much involves high performers. For instance, you might have 30% turnover, but it drops to 20% when you consider only voluntary departures but rises to 25% when you limit it to voluntary turnover for high performers.
- Consider the context of your industry. Different industries have different standards for turnover and different challenges associated with attracting and recruiting talent.
- Take action. If your turnover rates are high, do something about it. Focus on initiatives such as increasing flexibility, recognition, transparency, and engagement. Even if your rates are low, don’t rest on your laurels.