How to Calculate Employee Turnover Rate

how to calculate employee turnover rate

How to Calculate Employee Turnover Rate

Calculating employee turnover rate is a matter of dividing the total number of employee separations in a given year by the average total number of active employees working in the organization over the same period of time. This simple equation yields a percentage value that may be more or less than the industry norm.

Employee turnover rate can be analyzed in a number of variations that shed light on the weaknesses of the business in question, isolating the what, the why and the how of voluntary quits.

Employee Turnover by Location: Employee turnover percentages should be calculated by the individual branch for companies with several locations. This will give you an idea of how the turnover rates vary by each location.

New Employee Turnover: Dividing the total number of new hire quits in a year by the average number of active new hires over the same duration can indicate the effectiveness of your orientation program. If the result is less than the general employee turnover rate then it may be the line managers and work environment that are disillusioning recruits. Or maybe it is the onboarding process that needs to be improved.

HRsoft has found that the practice of stay interviews cut down turnover by 20% making a tangible positive impact on retention. Stay interviews are candid one-on-one conversations between line managers and employees geared towards building a trusted employee-manager bond. They result in the creation of stay plans that take active steps towards retaining an employee. Stay Interviews ensure that talent is nurtured rather than taking a “too little too late” approach like exit interviews do.


HRsoft is a leading provider of strategic talent management software that improves manager effectiveness and business results. Our full suite of cloud-based HR software solutions includes applicant tracking software, compensation planning software, total rewards software, stay interview software, performance management software, and content management software. To learn more about our Stay Interview Software, STAYview, click the button below!

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