How much is turnover costing your organisation?
Everyone knows that excessive employee turnover can be hugely expensive to any functional organisation, but you may be surprised to learn just how much losing a valuable employee can cost your business.
Obviously there is the upfront cost of recruitment and hiring a replacement. Job advertisements will need to be placed and valuable time will need to be spent conducting interviews and assessing new candidates.
Following this, your organisation will then need to invest in training and support for the new employee. There will undoubtedly be lost productivity as the individual is onboarded and educated on the various processes and systems involved.
An often underestimated cost of employee turnover is the effect that losing a colleague can have on your remaining staff. They may become disengaged and unproductive as they adjust to operating without a co-worker who may have also been a friend.
All of these internal and external factors make it near impossible to actually calculate the cost of replacing an employee, however, there’s no denying the fact that a high rate of turnover can be significantly detrimental, and can have a notable effect on the bottom line of any business.
In fact, the Australian Human Resources Institute has estimated, based on data from the Australian Bureau of Statistics, that staff turnover costs Australian businesses around $20 billion each year – and that’s a conservative estimate!
Fortunately, there are a number of things your organisation can do to combat staff turnover, boost employee engagement and minimise the affect this trend is having on your bottom line.
Human Resource Management Software (HRMS) that is designed to streamline HR processes is one such solution.
Because this technology can allow your HR department to monitor ongoing employee performance and turnover trends, it is ideal for identifying the factors that may be driving high turnover, and developing measured solutions to this problem.
HR management software can also help with factors such as employee engagement and motivation, making it the ideal tool for getting high turnover rates under control.