Looking through employment sites, you will notice that the same companies periodically place ads for the same vacancy. Why is this happening? This is due to such a problem of the modern organization of labor as staff turnover in the enterprise. It would be a great understatement to say that the “turnover” negatively affects the construction of a business. Moreover, staff turnover is one of the reasons why it is impossible to form a permanent and harmonious team, which significantly reduces the corporate spirit of the company. What caused this negative phenomenon and how to deal with it?
The essence of the "staff"
Staff turnover is the movement of personnel (labor force), which is due to dissatisfaction of employees with the position (workplace) or dissatisfaction of the company with a specific specialist. This is the norm that shows how often the employee loses and gains work. The staff turnover indicators are also called the “revolving door index”, because they make it clear how long an employee of the company has held his position.
It should be noted that this phenomenon is a kind of “organizational plague” for most modern domestic companies. Staff turnover is also the voluntary official dismissal of an employee from one firm with his subsequent employment in another organization on the basis of his independent decision. Lack of consideration of factors of social efficiency can cause constant “trickle”. High turnover rates can also signal a threat to the integrity and stability of the company.
Types of staff movement
Performing a staff turnover analysis, five main types can be noted:
- Intraorganizational - is associated with personnel changes within the company.
- External - labor movements occur between organizations, individual sectors and sectors of the economy.
- Physical - is associated with the voluntary departure of an employee from the organization for various reasons.
- Psychological (hidden) - occurs when physically the employee does not leave the company, but actually ceases to participate in organizational activities.
- Natural “turnover” (up to 5% per year) - is a natural process in personnel policy, contributes to the renewal of labor potential.
Taking into account the last point, it can be noted that a low level of staff turnover has a beneficial effect on the company, as it brings fresh thoughts and strength to the team. However, the frequent change of the head of the organization or managerial staff can lead to stagnation and lower performance. Plus, sometimes this leads to the so-called “ripple effect”, when other employees of the company leave after the management team. Another unpleasant moment is the dismissal of “fresh” personnel, if the funds spent on its training have not yet paid off.
The reasons for the negative movement of staff
Staff turnover is a “disease” of many companies. As you know, you need to fight not with the symptoms, but with the causes that caused this phenomenon. What are the sources of "fluidity"?
- Poor selection of personnel often becomes the root cause for early dismissal. The desire of the head of the company to quickly close the free space, the desire of the recruiting agency to get his fee, the desperate attempts of the applicant for a vacancy to find a better place for themselves lead to 99% of cases of early or late dismissal.
- The failed adaptation process or the absence of one at all causes the employee to quit on a trial period, in the first weeks of work.
- Uncomfortable working conditions also often lead to the loss of labor. A person spends the main part of daylight hours at his workplace. And his decision to dismiss or continue to be in the organization depends on how comfortable he will be.
- The level of staff turnover also largely depends on the degree of staff satisfaction with their management. Personal hostility, dissatisfaction with management methods quite often cause dismissals.
- Impossibility of career growth. Any employee who has ambitions and has worked for some time at the company begins to think about career advancement or raising salaries. In the absence of proper motivation and the possibility of growth and self-development, the employee leaves the company. It should be borne in mind that the level of wages is not always the necessary motivator for quality work. It can also be recognition, popularity, and other not material, but psychological factors.
- A person is subject to emotional influence, therefore situations periodically happen when one employee leaves after his colleague, relative, friend.
- And, of course, the incompetence of the employee, his inability to do his work on time, the inability to work in a team can cause dissatisfaction with the employee on the part of the manager, which can also be followed by dismissal.
What contributes to the care of staff?
A staff turnover analysis also helps to identify several factors that have a direct impact on labor turnover:
- age restrictions (it is considered that the most risky is leaving people under the age of 25 to another job);
- insufficiently high level of qualification (the higher the level of qualification of an employee, the less often he changes his job);
- the actual place of residence of the employee (the closer a person lives to his place of work, the lower the risk of his leaving the company);
- seniority (an increased level of staff turnover is observed in a group of employees whose work experience in the organization is less than three years).
How to eliminate the causes of staff turnover?
There are certain methods to reduce the influence of the main factors of the negative movement of labor.
- Competitive pay. It is necessary to revise rates, sick leave payments, benefits and holidays with the involvement of specialists in this field. Underpayment or overpayment leads to unreasonable economic losses.
- The introduction of a fair wage structure. It is necessary to adequately assess the complexity of the work of each employee in order to identify possible inconsistencies in rates. The bonus system also needs to be reviewed and reviewed.
- Stabilization of earnings. Unstable payrolls can lead to higher staff turnover.
- Improving the working conditions of workers: a flexible schedule, comfortable office furniture, a room for rest and eating.
- Refusal to perform unnecessary work. All instructions that are performed by company employees must be truly necessary. However, you should not lead people by the principle of “juicer” - this leads to a rapid depletion of labor potential.
- Creating a positive image of the company. Employees more often prefer firms with a good reputation, which may interest candidates for employment with interesting work, excellent working conditions, career prospects, the possibility of self-realization, an insurance and bonus system.
Staff turnover - calculation formula
To find this value, it is necessary to divide the number of employees who have worked for at least one year by the number of employees who got a job last year, and multiply the result by 100%.
The staff turnover formula may also include finding the coefficient of half the duration of the work. This allows you to determine how much time passes before half of the employees of a particular group, who simultaneously started working in the company, left it. The calculation of staff turnover is needed in order to determine what level of expenses incurred due to the dismissal of new employees. Leaving employees from the organization can cause serious economic losses for the employer.
The calculation of the turnover rate
This indicator can be determined based on:
- layoff ratio (you can calculate the number of employees quitting in one year);
- staff turnover (the number of layoffs for a certain period of time is divided by the average number of personnel for the same time period and is multiplied by 100%);
- index of stable labor - on the basis of this formula, you can determine the number of workers working in the company for a year or more.
The layoff ratio is quite widely used, since this phenomenon always causes certain losses for the company. This indicator and the calculation of staff turnover helps to determine the costs of the company that arose during the dismissal of employees.
Coefficient calculation formula
The calculation of the turnover rate is carried out according to the following formula:
- Ktek = (Hsj + Hdps) * 100: S, where
- Ktek is, in fact, the staff turnover rate;
- Hszh - the total number of those who left voluntarily for a specific period;
- CDPS - this is the number of those dismissed for absenteeism, criminal record or violation of labor discipline for a specific period;
- S - the average number of employees for a particular period (often an independent indicator, since it reflects the dynamics of changes in the composition of the team).
The calculation of the average number
To find this indicator, you must monthly (on the 1st day) note the payroll number of employees of the enterprise, which falls on this day. At the end of the reporting period, it will be possible to determine the average number by the formula:
- S = ((S1 + S2): 2 + (S2 + S3): 2+ ... + (Sn + S1n): 2)): n, where
- S is the average number;
- S1, ..., Sn - list number on the 1st day of each month up to the reporting one;
- S1n - payroll on the 1st day of the month following the reporting.
Fluctuations in employee turnover rates ranging from 3% to 5% are considered normal. Deviation to the smaller side can be calculated as stagnation in the team, and excess as a decrease in stability and an incorrect approach to personnel management.
What does the cost of "turnover" consist of?
Each enterprise is faced with such a problem as staff turnover. The formula for calculating the cost of movement of personnel consists of the following indicators:
- the volume of production that will be lost in the event of dismissal of an employee;
- additional remuneration for employees who temporarily perform the duties of the resigned employee;
- attracting highly skilled workers to easier work;
- the cost of waste and marriage received during the development of work by a new employee;
- costs associated with attracting and selecting candidates for a vacancy;
- expenses aimed at training or retraining employees;
- administrative costs associated with the removal of the dismissed from the payroll;
- decrease in labor productivity during the training of new workers.
Methods to minimize staff turnover
The decrease in staff turnover is achieved through the following personnel management methods:
- determination of the reasons that caused the dismissal of each employee, and statistical accounting of these reasons;
- maintaining general statistics on layoffs;
- implementation of programs for horizontal and vertical movement of personnel;
- development of methods for selecting and adapting employees, as well as the use of mentoring;
- increasing the image of the company in the labor market;
- the creation of temporary teams to work on projects;
- formation of personnel reserve;
- attracting HR managers and consultants to work with personnel.
Retention Methods
To retain valuable personnel who are at different levels of the career ladder, companies resort to various means and methods. So, for example, various benefits packages for ordinary employees and senior staff can be formed. For example, ordinary employees may be paid for travel in public transport at the expense of the company, medical insurance, free meals and continuing education courses. The package of privileges for managers may consist of such positions as a flexible work schedule, granting loans and loans on favorable terms, remuneration for the implementation of the plan, special promotional offers.