Calculating Turnover

System · February 2003

We would like to calculate our turnover for 2002. We are not exactly sure of the formula we need to use. Can someone help me out?

sandra_d · February 2003

I believe that there are several formulas that can be used - the important thing is choosing one and sticking with it for year to year comparisons. The formula we use is the annual # of terms divided by the # of ees at the start of the period. We calculate by department as well as by organization as a whole.

POPEYE · February 2003

Something to consider for accurate numbers - are you going to count retirements or deaths? We always figure two rates, one including the above and one not. The number crunchers always like to have both.

Gillian · February 2003

Calculating turnover for 2002 may give you some gross percentages but will not provide any information about high points and low points. If there is benefit to know about fluctuations then the calculations should be done on a quarterly, monthly or some other basis. In addition, you should decide who to count in the calculations. Some employers do not count layoffs, retirements etc.. Other employers are only interested in full time turnover so will not count part timers. Further, it is beneficial to calculate turnover by department.

LFernandes · February 2003

The Calculation I use is:

Number of employees who left x 100 divided by Average number employed. I use this formula for company and departmental turnover rates.

Hope this helps.

Laura

jules2001 · February 2003

We use similar calculations, but one thing that we separate out is the terminations before and after the first 90 days of employment.

Don D · February 2003

I agree with all the formulas listed. My comment is about the process and its results. The only reason, in my opinion, to chart anything in the first place is to be able to claim consistency or to spot variations and explain them. Otherwise, what's the value of the figures to begin with? If I'm looking at scrap rate over time for a factory producing television cable and my chart shows a 'trend line' which is a steady downward trend, the owners are pleased as punch. But to get that trend line, looking deeper, I spot 4 out of 12 months with tremendous spikes, either upward or downward. Overall, the chart shows no reason for concern and invites high-fives. The spikes, however, are the important elements. Why are they there and what is done about not repeating them? Turnover rates on a large scale, like annual rate, are largely useless. Show me the value the figure has, except in comparing that figure with some vague concept of what it should be. In my opinion, turnover rates that are not at minimum, monthly, are, over time, very useless in analysis and corrective action.

Pork · February 2003

Sara: If you have a 10 person organization and you begin the year with 10 people and at the end of the year you have 10 people on the payroll, "Dandy Don" says who cares? Well the work got done or did it? Now assume this is your 10 man accounting department and the significant amount of time required to get each and everyone of them up to speed, even when they are all seasoned book-keepers from other companies. I bet there is a lot of CFOs pulling their hair out going through that year with always a new set of faces keeping the books on month end, quarter-end, and year end close outs.

The above is a 100% turnover: 10 X 100 / 10 = 100%, 10 faces x 100 /10 new faces = 100% turnover.

10 faces to start the year, by the time you reach the end of the year with 10 faces you may have had a total of 5 new faces and 5 faces have gone; you have had a total of 15 faces in that unit; therefore, what percent of 15 faces is 10 faces? Why, it is 66% turnover.

I can't count much higher than 10 because I still have 8 fingers and two thumbs. I lost my toes to the war. I keep it simple for me and every one else. What is most important in this "watch out arena" is your changing racial profile and keeping a watchful out for unit hiring practices, is there a trend? It changes rapidly!

Enjoy your use of this forum, Dandy Don spends most of his day here, he has a bell that rings on his computer every time a new post hits the screen. Regardless, read what the man writes it is usually right on the money I just happen to disagree with him on this one. And don't worry about spelling Rocky, & Don will keep you honest! Pork

cebudragonlady · February 2003

I suggest that instead of Turnover Rate as a percentage of whatever you want it to be ~ use Average Length of Service per employee since Date of Hire. If the Average keeps getting longer and longer as time goes on, then the "real" Turnover Rate gets lower.

Chari

Pork · February 2003

ABSOLUTELY, the most important factor as "Don" stated is the factor of knowing the lost trends with in the departments of quality trained individuals. Longivity is the most important aspects. The loss of trainees as in our case is a "so what drill". The loss of a seasoned herdsman/woman can be devastating to the production and growth of "baby pigs". In Mississippi we are the Swine Industry and there is no one helping us to grow our staff. Our world is not for everyone, but one does not know that until you can live the every day activity. We watch closely the age (time in service) of the work site team of nine. The most successful and stable units are always in the oldest (time in service, total number of days, mandays on the payroll & this does not include the time away on W/C or FMLA)units as a group compared to the other units.

I would think that this should be every HR's scale for determining and comparing work units. My added thoughts, Pork

ray a · February 2003

I track turnover on a monthly basis, but only for the entire facility - not by department. I divide the number of terminations by the average population for the month. But, the term number excludes employees who leave with less than 90 days and all retirees.

pmaher · February 2003

Doesn't anyone do an annualized rate anymore?

mrosari · April 2003

How do you calculate an annualized rate?

Calculating Turnover

Comments