what is a good employee turnover rate?

A zero percent employee turnover rate simply isn’t realistic or desirable. So what is a realistic turnover percentage, then? The answer varies depending on the region, industry and roles within those industries. In addition, data methodology and world circumstances affect rates. For example, a press release by Gartner in April 2022 forecasts that U.S. companies could expect a significant spike in turnover percentages post-pandemic.

LinkedIn's 2021-2022 survey of turnover rates among members shows that while the average was 10.6%, certain industries had much higher rates, with professional services topping the list at 13.4% and tech and media only slightly lower at 12.9%. Government workers (8.4%) and construction crews (9.2%) scored below-average rates.

Turnover rates among job positions placed human resources at the highest level with a rate of 14.6%, and administration recorded the lowest at 7.8%.

By tracking your employee turnover rate, you can easily spot alarming trends and see where your business falls when compared to competitors or other companies within your region. Before we focus on improving your staff turnover rate, let’s discuss why employees move on.

what causes employee turnover?

Employees may leave a position for many reasons, including a toxic work environment, better pay elsewhere and new career prospects. Some motives are out of your control, such as a change in a family situation, relocation or illness.

However, most voluntary resignations happen because of management problems, lack of opportunity or burnout. The State of the Global Workplace 2022 Report from Gallup provides insight into workers’ mental states and reasons for job dissatisfaction. Let’s dive deeper into some common turnover triggers.

top reasons for employee turnover

management problems

When managers constantly berate employees, work environments turn hostile and people resign. Supervisors who micromanage — or take the opposite tack and leave employees entirely to their own devices — also increase staff turnover. People who find their line managers difficult to work with often dread coming to work.

uncomfortable work environment

Sometimes the problem isn’t the boss but coworkers. When the company culture doesn’t provide a safe, inclusive work environment, people feel stressed and are quickly willing to jump ship.

burnout

High-pressure working environments and too little downtime invariably cause employee burnout. When people feel overworked and overcommitted, they begin to feel overwhelmed. Unless they’re given opportunities to restructure their schedules, these workers seek new jobs.

boredom

Not every job can be as exciting as we would like it to be. However, companies need to find ways to challenge their employees. Changing up tasks and providing chances for reskilling can help prevent workers from feeling disengaged — a feeling over three-fourths of the workers in the Gallup poll admitted to.

not enough flexibility

Workers are requesting and receiving flexible schedules and opportunities to work remotely. If your company is lagging in these offerings, you may need to prioritise a hybrid workplace to attract talent.

reducing employee turnover

To retain good employees, you must understand how the above key triggers relate to your organisation. Only then can you devise a specific strategy to combat each situation.

With the knowledge of how your organisation works, including its chain of command and current employee training and incentive programmes, you can make changes that directly address the above problems. For example, here are three actionable steps to boost employee retention.

create training opportunities

When training abounds, employee turnover plummets. According to the 2022 Learning & Development Report by Findcourses, over two-thirds of the employees that ranked themselves as highly satisfied with their jobs also said their company promoted a learning culture. Ideally, training should start at the onboarding stage and continue throughout the worker’s tenure.

Training programmes allow employees to develop new skills and explore different career paths within your company in a practical way to combat boredom and reduce burnout.

Furthermore, management training can help develop the traits necessary to create effective leaders. Employees desire a fair, encouraging boss that provides positive feedback and recognises their talent.

offer flexible scheduling

Many employees benefit from flexible schedules and the opportunity to work remotely, such as parents who need to pick kids up from school or employees with long commutes. Other individuals prefer to work on a per-project basis rather than a per-hour basis.

In the manufacturing industry, multi-shift days lend themselves well to flexible scheduling. Likewise, many companies in the logistics sector operate 24 hours a day, 7 days a week, making them well-suited to flex scheduling.

In a July 2021 quarterly report, McKinsey noted a vast disconnect between employers who want employees back in the office and employees who wish to remain working from home. Understanding what employees really want and adapting to their needs allows you to get ahead of competitors when recruiting and retaining talent.

implement a recognition programme

Well-designed employee compensation and recognition programmes give workers a lift and help to improve retention rates. Traditional awards like Employee of the Month still work well, as do bonus cheques and project-based awards. To make the most of your recognition programme, acknowledge achievements promptly and provide meaningful feedback.

If you’d like to learn more about strategies to reduce employee turnover, the first step involves understanding the top causes of employee turnover. Click on the link below to download our handy guide.

want to discover other causes of employee turnover and ways to resolve them?

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