What Does Turnover Cost Your Company?

Countless studies and surveys have been performed in an attempt to calculate the exact cost of employee turnover. But the simple fact is that the specific number is different for every employee lost and every company affected. What is clear, however, is that the negative consequences are high, and in many cases, more sweeping than employers realize. Before you let another employee walk out the door, consider the kind of impact it will have on your company:

Your Productivity Will Drop

The lost employee was contributing something to your company, otherwise you would have fired them before they had a chance to quit. Now that they are gone, all the productivity they provided is gone as well. Even if they had a relatively minor position, it will prove to be a setback for your company.

Your Employees Will Be Overworked

Unless the person who quit was entirely dispensable, the work they did will have to be done by someone else, usually while they are still performing their own job responsibilities. That causes productivity to drop even further and places a tremendous amount of stress on whoever is picking up the slack. Morale drops, and if the problem goes on too long, it can lead to further turnover.

Your Staff Will be Less Knowledgeable

In a shocking number of companies there are one or two people that have knowledge no one else has. As a result of their skills and experiences, they have gained special insights that can’t be found in any book, website, or computer file. When that knowledge walks out the door, it may be lost permanently. Measuring the impact of this brain drain can be difficult, but you will know it when a problem arises that no one has a solution to.

You Will Pay to Recruit a New Employee

This is when empirical measurements really become possible. Now that you have a hole on your workforce you will have to recruit someone else. This involves a potentially long and expensive candidate search, an interview process with attendant costs, and finally training if and when you find a suitable hire. This can all prove cost prohibitive, especially if you have a small or nonexistent human resources department.

To put things into context, think of the last time you experienced turnover and how long it took you to fully recover. A lot of time and money was wasted all so you could get back to where you started. The best policy is to mitigate turnover as much as possible, and that starts with hiring the right people. Rely on the experienced recruiters at Morris Bixby to connect you with more of the candidates that put loyalty first.

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