Employee turnover

Staff turnover and employee turnover

The terms staff turnover and employee turnover are often used interchangeably in HR practice, especially when it comes to departures and the need to fill vacancies. However, they do not mean exactly the same thing. Turnover is a broader concept because it encompasses the entire flow of employees: intakes, departures and internal movements. Turnover, on the other hand, mainly refers to the departure of employees from the organization and the hiring of new people to replace them.

The importance of employee turnover

Turnover analysis allows you to check how employment is changing. The mere fact of fluctuations does not have to be a problem. The influx of new people can enrich the company with new competencies and experience, and promotions and internal transfers can testify to the development opportunities of employees.

On the other hand, a fluctuation that is too high, sudden or affects people with key competences may be worrying. Frequent departures can lead to an increase in the costs of recruiting and onboarding new people and a loss of organizational knowledge.

Causes of employee turnover

The reasons for personnel changes are varied. Departures may result from dissatisfaction with salary, working conditions, lack of development opportunities, overload of responsibilities or relationship with a superior. Some of the reasons are beyond the company’s influence, e.g. moving, changing family situation or retirement.

Turnover is also influenced by processes taking place inside the organization. Growing a company can lead to an increase in employment, and reorganization can lead to job changes and transfers between teams.

How to measure staff turnover?

There is no single indicator that describes all the elements of fluctuation. Depending on the purpose of the analysis, the number of admissions and departures, job changes, promotions, and internal transfers can be observed.

One of the most commonly used metrics is the employee turnover rate. It is usually calculated as the ratio of the number of people who left the organization in a certain period of time to the average level of employment in the same period, multiplied by 100%. It shows the scale of departures, but does not present all the changes that make up the turnover of staff.

How to interpret fluctuation?

The level of turnover alone is not enough to assess the personnel situation. What matters most is who is leaving, in which teams the changes take place, after what period of employment and for what reasons.

Regular analysis helps to notice worrying trends earlier, better plan recruitment and development of employees, and assess the effectiveness of HR activities.

Therefore, staff turnover is not an unambiguously positive or negative phenomenon. The most important are its scale, causes and impact on the organization. Only the combination of data on the flow of employees with the analysis of their sources allows for a proper assessment of the situation and making accurate personnel decisions.