Reduce Staff Turnover

Keeping staff longer by reducing voluntary and involuntary staff turnover is a key performance indicator for many organisations. 

Staff turnover is costly and even small improvements in retention can significantly improve profitability. Broadly speaking, the direct measurable costs of staff turnover consist of:

• Separation costs such as severance pay, management costs and possible litigation for involuntary separation
• Replacement costs such as sourcing expenses, HR costs associated with screening and assessing candidates, manager time spent interviewing candidates, travel and relocation expenses, signing bonuses, induction and training.

Employee turnover also impacts organisations indirectly in ways that are more difficult to quantify, such as lower productivity of departing employees, their colleagues, managers and replacements, and general downtime associated with recruiting and inducting new personnel. 

Taking into account both direct and indirect costs, the total cost of replacing one employee is estimated to be 150% of their annual salary (Saratoga Institute and Hewitt Associates). This clearly illustrates the financial consequences of employee turnover. For example, for a company with only 1,000 employees, an average salary of $50,000 and a turnover rate of 10%, the annual cost of staff turnover is $5 million. Consequently, reducing staff turnover by only 0.5% would deliver a savings of $375,000 dollars per year.

Onetest also assists companies to reduce staff turnover by measuring employee engagement and the perceptions of exiting employees, and conducting 360 performance appraisals using standardised tools, all of which which aids in the development of employee retention initiatives.

Testimonials

Here are some testimonials from Onetest clients.

	“Onetest... makes interviews much more effective and increases 'objectivity' in the selection process, which has reduced our staff turnover and improved our quality of hires.” Steven Wilson Organisation Capability Manager PepsiCo Australia

	“I would recommend that other not-for-profit organisations do staff perception surveys. It gives a really good picture of the culture of the organisation as well as providing valuable insight into staff morale. It also highlights any possible issues before they become a major problem. Karenlee Spillane Chief Executive Officer Royal Children’s Hospital Foundation

Read more testimonials from Onetest clients.
 

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