Measuring Turnover

April 13, 2006

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While measuring turnover for large companies with many employees is usually more technical and the results more scientific, small businesses can also keep track of turnover and try to spot trends and potential problems.

Did You Know?

The Bureau of Labor Statistics reported that the average turnover rate is close to 9 percent per year.

Follow these steps for tracking turnover:

Keep a list or file of employees that leave. In the file, include:
- the length of time that the employee worked for you
- the position that the employee held
- the reason that the employee left (information from an exit interview can help here)
Over time, try to spot trends in turnover.
- Are there positions that you have trouble keeping filled?
- Do employees tend to stay for the same length of time before they leave your employ?
- Do employees seem to be leaving for similar reasons (like receiving more pay or a more responsible position)?
If you suspect there is a problem with one or more positions, try to remedy or prevent the problem. It is sometimes possible to redesign a job by adding more attractive duties and reassigning some less desirable ones.
If you suspect that you're not paying enough, get some information about what other businesses are paying for similar positions.
If you suspect that people are leaving because positions elsewhere allow them more growth, you can emphasize to future employees that the position has limited growth potential so that they know what to expect, or you can try to find ways to expand the responsibilities of the position.
If the problem seems to be with one specific position, look closely at the working conditions of that position. Were the employees in that position forced to adhere to impossible deadlines, given all the worst tasks, or forced to work with difficult customers or employees more than should be expected? There may be something specific about this position that is driving good employees away.