What Is Employee Attrition?
Rekha Kumbhat
Serial Women Entrepreneurs | Helping Corporates with complete Spectrum of HR Solutions | Facilitating Import & Export of Metal |
Employee/Staff attrition is a process by which employees leave the workforce through resignation or retirement and are not replaced immediately. Though in some cases, Attrition can reduce costs during financial turmoil. Generally, it leads to a considerable reduction in the size of the overall workforce of an organization, like attrition among minority employee groups could reduce diversity in an organization or attrition among senior leaders can lead to a major gap in organizational leadership.
The loss of staff greatly weakens the organization and this reduction in the number of people increases the workload for people who stay back. Attrition can be due to various reasons and its types include,
- Voluntary Resignation
- Involuntary Attrition
- Retirement
· Demographic
Formula for Calculating Employee Attrition Rate:
Attrition Rate = Number of Attritions/Average Number of Employees x 100
Ideally attrition rate should be less than 10% or this could lead to poor image and risk damaging the brand of an organization.
Why does attrition happen?
The few ways in which attrition happens are
· Lack of Recognition
· Lack of employee benefits/ Better pay
· Absence of Training and Developmental programs
- Mismatch of job clarity and skill of the employee.
- Limited Growth opportunity.
Ways to Reduce Employee Attrition Rate:
1. Assess for job and culture fitment right at the time of hiring
2. Offer Opportunities for career advancement
3. Regularly gain feedback on employee satisfaction questions
4. Ensure a competitive pay package/compensation
5. Conduct detailed exit interviews to spot attrition trends
Attrition can be solved if it is addressed as early as the hiring process. Calculating the attrition rate educates the management to understand the staff turnover issue and then developing a data-driven hiring procedure to target job candidates who possess the qualities necessary to perform well improves attrition rates.