cost of turnover

GLC

My boss wants me to do a cost analysis of our turnover. Any good easy ideas on where to start. What things would you include in the analysis?

Margaret Morford

Include advertising costs, cost of everyone's time to interview prospective candidates, training and orientation time for new hire, cost of setting new hire up on payroll and benefits, loss of efficiency during training period, time of person who trains new hire (Maybe a certain percentage of new hire's manager's time)and cost of covering the open position until you hire new person (maybe paying for temp or overtime, etc). Remember when you are figuring in anyone's time to participate in the process that you also need to include the cost of benefits in their hourly rate. Bottom-line, it's a huge number!

Margaret Morford
theHRedge
615-371-8200
[email]mmorford@mleesmith.com[/email]
[url]http://www.thehredge.net[/url]

Cindy Hanna

Don't forget pre-employment physical and drug screen if that is a requirement.

Don D

Also run the meter on how much time at your hourly rate you spend on this study right up to the point of turning in the summary. It's certainly part of this cost of turnover since if you did not have the problem of turnover you would not be doing this study and could do something more productive.

LisaMN

We use a formula

1. Annual wage x .25 =
2. Annual wage x .25 x .30 = (benefits)
3. Total cost per employee (line 1 + line 2)
4. Total number of employees who left
5. Total cost of turnover (line 3 x line 4)

Then of course as Margaret mentions the cost advertising, training, lost productivity, management time for the selection process etc etc. This can be an average cost per separation.

The formula gives you a hard number for the number crunchers........

The rest gives you a soft number for the Board Report.....

SandiF

Here is one I found on an internet site that has a formula.

[url]www.cnxcare.com/Employers/BPS/cost.htm[/url]

Don D

Boy! That really look comprehensive. Thanks for posting it! I'm printing.