Attrition Rate: A Key Metric for Employee Retention Success
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staffing attrition, how to reduce attrition of employees, employee attrition, staff attrition

Attrition Rate: A Key Metric for Employee Retention Success

People who start and finish their careers with the same companies are extremely rare. After some time, the majority of people leave, or the corporation involuntarily terminates them. Even though leaving a company seems to be a fairly simple journey, there are many complex issues involved in this attrition process.

In this blog, we will discuss what staff attrition is and how to determine your attrition rates. In addition, we’ll discuss how to control employee attrition within your company.

Employee Attrition Meaning

Employee attrition is the term used to describe the process by which an employee quits an organization, including voluntary resignation, layoffs, failure to return from a leave of absence, illness, or even death.

The term “staffing attrition” describes the regular departure of workers from a business or organisation. Employees departing for resignations, retirements, or other reasons like being laid off or fired are included in this. Because it may result in the loss of talented individuals, higher hiring and training expenses, and interruption of workflow, attrition can have a big effect on a business.

In order to address any underlying issues and lessen the negative impacts, it is crucial for businesses to monitor and understand the causes of attrition. Attrition rate is another indicator that businesses may use to gauge their performance in keeping personnel.

Employee and staff attrition are used interchangeably. This process occurs whenever someone leaves the organization for whatever reason and is not replaced for a very long time (if ever). Most people usually mix it with employee turnover, which is slightly different from it. Let’s talk about them;

Employee Attrition and Turnover

Although both phrases are commonly used interchangeably, the key distinction is that staff turnover includes all job terminations, even those that are afterwards filled. Attrition is used to evaluate long-term vacancies or full position eliminations.

A high staff attrition rate might indicate that your company is contracting as well as a “war of attrition” in the workplace, when workers are often departing because of subpar management and a toxic work environment. High attrition rates are a warning indication for possible problems in the organisation, although high turnover rates are acceptable as long as a business is stable or even growing.

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Types of Employee Attrition

Over 47 million Americans willingly left their jobs in 2021, according to the U.S. Bureau of Labor Statistics. This unprecedented mass exit of employees from the job market known as the Great Resignation is also leading to staff attrition.

Attrition refers to the loss of employees from a company or organisation, it can be either voluntary or involuntary. Both may have a big effect on a business, so it’s crucial to understand the reasons to address them, including providing development opportunities for employees to help retain employees.

1. Voluntary Attrition 

It occurs when a worker decides to quit the company. Any excuse an employee gives for leaving on their own, whether it’s actually voluntary or not, falls under this category.

You’re probably most familiar with true voluntary terminations, like leaving your job to start a new one. However, a worker who leaves for medical reasons or merely because the working environment is poisonous might also be considered voluntary attrition.

2. Involuntary Attrition 

It is not voluntarily chosen by the employee. A post may be eliminated by reformatting, layoffs, termination for misconduct, or unsatisfactory performance.

After then, the corporation either removes the position or doesn’t backfill it.

Why Does Your Staff Attrition Rate Matter? 

To make sure you’re not losing more employees than you need, you should constantly review your staff attrition rate. Although sometimes, businesses consciously seek out high attrition rates because they wish to hire fewer employees.

So, how to calculate employee attrition rate? The number of full-time employees who leave each month (also known as “separations”), divided by the average number of employees, is multiplied by 100 to determine your employee attrition rate.

The equation is as follows:

Employee Attrition: Everything You Need to Know

By summing together all 12 months, you can also determine the staff attrition rates for the entire year and the previous 12 months. However, to perform the calculation, you must first gather your data.

Keep in mind that your calculated attrition rate tells you nothing without context. It must be taken into account within the framework of your company. How has it changed, for instance, over the course of a year, a month, or since you started managing it better?

Additionally, it could be crucial to examine staff attrition rates by department or location while examining them. While attrition may be low across the board for your business, you might observe that one site is losing staff while another is adding more, cancelling each other out.

You’ll need to group this information more often as your business grows larger. Additionally, you can utilize it to view your diversity data.

How to Control Employee Attrition in the Workplace

If you’re having trouble on hiring and employee retention, which is leading to high staff attrition rates, you can work on some major channels to fix the issues.

1. Provide Training and Learning Opportunities

Give your managers the necessary training and education they require to manage the employees well. Investing in management training while maintaining the company’s budget will help your company lower the staff attrition rates. This will assist you in keeping both managers and employees intact.

2. Keep Check on Salary Trends

One of the major reasons behind resignations is below-market wages. Your company should conduct annual salary surveys and benchmark the salaries. This step will help you retain your staff by making them happy.

3. Encourage Employee Feedback

Encourage employee feedback and work on the issues highlighted by them. Do this only if you are eager to make adjustments in light of what you discover. Otherwise, it can build resentment among the employees.

4. Offer Benefits to Employees

Your company should focus on offering the employees benefits and perks that they like. It increases their loyalty to the company. Remember to provide an update every few years to keep up with the market and employee demands.

5. Allow Flexibility

Think about offering more flexibility, either with regard to start times or remote work. Many firms learned in 2020 that many jobs could be performed just as well from home as they did in the office.

6. Improving Hiring Strategies 

Make sure you initially recruit the right person for the available job opportunity. To do that, it is important to post jobs with accuracy. Look for someone who is qualified as well as motivated to do the job.

Promote job positions within the company as well. Use succession management and strategic workforce planning to ensure that you’re filling in the leadership and skill gaps. This way, you can promote individuals and make plans for the future of the company even when your employees retire or leave for other reasons.

You can take the help of Employee Connect to track the trends over time and revamp your HR strategies.

Additionally, it is possible to control involuntary attrition. For instance, carefully thought-out hiring strategies will aid in preventing overstaffing and the subsequent need to let employees go when your organization doesn’t expand as planned.


Many businesses only pay attention to their staff turnover rates, but this can omit crucial information. If your business is losing employees, you need to understand why this is happening as well as what you can do to manage skills gaps.

You may utilize long-term workforce planning tactics to control employee attrition by being aware of the reasons why employees leave your company.

Employee Connect can facilitate your business in effectively controlling attrition rates by assisting in finding the right talent, incorporating training needs, and measuring various trends over time. Get the free demo to test these trends by yourself!


In the world of HR software, EmployeeConnect continues to be one of the leading industry providers of innovative solutions. We helps Australia business owners and people managers be more efficient, cost-effective and compliant by taking the hassle out of HR and payroll admin. If you spend more than an hour every day on HR administration (like on/off-boarding, performance review, or employee timesheets), then EmployeeConnect is here for you.

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Byron Conway

Content Coordinator at EmployeeConnect