April 4, 2018
Employee turnover is a real problem with real expenses. They’re not just monetary. An abundance of time and work is also lost when an employee leaves. Add in the investment you’ve made in the employee to this point in terms of salary, training, and enrichment. Voluntary employee turnover costs add up quickly. Plus, you just prepped your competition’s next great employee. These five stats will make your head spin!
1. Finding and training a replacement costs roughly 6 to 9 months’ salary.
This is the all-in monetary cost of losing an employee: advertising, recruiting, interviewing, and onboarding. The average interview process takes 23 days. That’s 23 days of displaced work. Don’t forget the opportunity cost of not having an experienced pro for those days as well.
2. It take 8 months to 2 years for a new hire to reach full productivity.
Yikes. Time is money. New hires must get to know coworkers, acclimate to a new environment, and learn all of his or her new responsibilities. Additionally, even if new hires receive proper training, he or she spends time to reach the productivity of a seasoned associate. And that time spent is your money.
3. One third of new hires quit their job after about six months.
Do the math. At least six months’ salary to replace an employee minus six months of work equals nothing. Some turnover is unavoidable. But, when you hire, be sure the position and company culture are a good fit for the new hire. If it’s not, it’s best to know early. See our FailSafe program for more information on how we can help.
4. Poor Training accounts for 40% employee turnover within a year.
This demonstrates how important onboarding is in reducing employee turnover. What does your new hire training look like? Trial by fire? Are you using the ADDIE development model? Do employees report they are fully equipped to handle their new role? Effectively introducing a new hire into company culture can make or break their career with your company. And your bottom line.
5. One third of employees knew whether they would stay with their company long-term after their first week.
It’s true. One week is all it takes! That’s 40 crucial hours that make or break long-term retention. Set up all new hires to succeed in their first week. Training, communication, and culture increase long-term retention. Make them feel welcome.