Why Millions of U.S. Employees are Quitting Their Jobs and How Companies Can Navigate
The past two years have been anything but consistent.
The pandemic left the United States in the worst recession in history. People struggled to adjust to remote work, and what we defined as “normal” varied day-by-day.
And yet: Out of that turmoil and inconsistency, we now see a record number of people quitting their jobs in pursuit of better opportunities.
According to the U.S. Bureau of Labor, 4 million people quit their jobs in April 2021, and July saw another 4 million leave.
Which leads me to question: Amidst the past two years of unpredictability — and a resulting lack of security — why are so many people taking the leap now?
Here, we’ll explore what employee turnover is, how much it could be costing your business, and how to calculate employee turnover. Plus, how employers can minimize the effects of what’s being called the Great Resignation, according to experts.
What is employee turnover?
Employee turnover refers to the percentage of employees who leave your company during a given period of time.
Your company’s employee turnover rate includes anyone who leaves for any reason. This includes resignations, terminations, or retirements. However, turnover rate typically doesn’t include internal movement, such as an employee switching teams or being promoted.
Turnover can cost a business thousands — if not millions — of dollars, and can negatively impact team morale and performance.
All of which is to say: The lower your turnover rates, the better. Low turnover rates signal a healthy, engaging company culture— which is critical for any business’ long-term success.
To determine how your company’s turnover rates compare, let’s explore average turnover rates by industry next.
Employee Turnover Rates in 2020 (By Industry)
Employee turnover rates vary by industry, so you’ll want to do your own research to determine how your company’s turnover rates stack up against competitors.
However, to give you a sense for an appropriate range, let’s take a look at a few turnover rates by industry as reported by the U.S. Bureau of Labor(it’s important to note, these turnover rates are from 2020, which had unusually high turnover rates):
- Professional and business services: 69.2%
- Health care and social assistance: 45.2%
- Trade, transportation, and utilities: 60.5%
- Retail trade: 69.7%
- Leisure and hospitality: 129.3%
- Government: 24.2%
- Real estate and rental and leasing: 49.4%
Next, let’s look at average employee turnover rates.
Average Employee Turnover Rates
In 2021, the overall turnover rate across industries was 57.3% — but that drops to just 25% when considering voluntary turnover alone.
Voluntary turnover trends continue to rise. In fact, the Work Institute’s 2020 Retention Report states that there’s been an 8% increase in turnover rates since 2018, and an 88% increase since 2010.
Average turnover rates varies significantly depending on your industry. However, a 90% employee retention rate is generally considered good — which means the closer you can get to a 10% turnover rate, …read more
Source:: HubSpot Blog
