Staff Retention
Is the staff entrance to your building a revolving door? It is impossible to stress the importance of retaining high performance, and yet:
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two out of three employees would rather work somewhere else
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staff turnover costs thousands of pounds for every departing employee
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eighty percent of staff turnover is unnecessary
Employee turnover is inevitable, but when it is excessive, it can put a
business into the red. The costs of turnover are easy to overlook or
ignore - but you ignore them at your own peril.
Excessive employee turnover has obvious costs you can track, but the real costs take a greater toll. Many new employees do not become fully productive until they've been trained and gain experience, a process that usually takes several months. The time, effort, and money invested in those employees walk out of the door when they leave.
And yet, in any workforce, in the last 6 months:
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50% of employees considered looking for another job
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27% of employees actively looked for another job
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20% of employees applied for another job
- The cost of losing a High Performer is up to 2.5 times their annual salary
The CIPD's Recruitment Retention and Turnover Survey, 2005, reported that 69% of UK companies experienced a negative impact from staff turnover. In addition, 73% of respondents reported having retention problems with average staff turnover at 15.7%.
Trying to apply a cost to employee turnover is difficult. However, we have set out below an example of a Employee Turnover Cost Analysis and Return on Investment:
Example:
A company has 100 employees. Turnover is 20% per year.
Employee turnover cost is 3 months wages (very conservative)
Minimum wage is £5.50/hr. plus 20% benefits.
Existing yearly employee turnover cost = 100 employees X 20% X £1839 (including benefits) = £36780 per year.
This cost is avoidable.
Do you experience this kind of problem? Would you like help in reducing staff turnover? The Profile XT can help you to identify what motivates your people on a one by one basis and enables you to coach them to maximise their potential in your organisation.
Contact Profiles and let us show you how psychometric testing will help you to improve your staff retention.
