HR managers play a vital role in any organization as they are responsible for managing the most important resource available to your company which is your employees. While managing employee attrition is one of the key areas of focus for HR, it is also important to predict the employee turnover rate. This article will explore methods to predict employee turnover and how you can develop employee retention strategies. 

Why is Employee Turnover Prediction Important?

Employee turnover is the percentage of employees leaving an organization within a certain period. Turnover is part of doing business, but it can be costly for companies if it happens too often. A study by Employee Benefit News found that the cost of losing a single employee can be up to 33% of their annual salary. That’s why HR managers need to predict employee turnover and take steps to reduce it. 

Several factors can impact employee turnover, including job satisfaction, company culture, pay and benefits, and workload. When predicting turnover, HR managers should consider these factors and improve employee engagement and retention by focusing on job satisfaction and company culture. By offering competitive pay and benefits, your employees will be satisfied, and your HR managers can help reduce employee turnover. 

How to calculate Employee Turnover Rate?

There are a few different ways that you can calculate employee turnover rates. The most common way is to take the number of employees who have left the company in a certain period and divide it by the average number of employees during that same period. This will fetch you the percentage you can use to compare different periods or departments within your company. 

Another way to calculate the employee turnover rate is to take the number of employees who have left the company in a certain period and divide it by the total number of employees at the beginning. This method is helpful if you want to compare turnover rates across different companies. 

Once you have calculated the employee turnover rate, you can start looking at factors that may affect it.  

Common Factors that can affect Employee Retention Rate

• Compensation: Employees who feel they are not being paid enough may be more likely to leave the company. 
• Benefits: Employees may be more likely to stay with a company if they feel they are receiving good benefits. 
• Work-life balance: If employees feel overloaded and think they are working too much, they may be more likely to leave the company. Not having enough time for their personal lives is a crucial factor.   
• Job satisfaction: If employees are not happy with their jobs, roles, or responsibilities, they may not wish to stay with the company. 

Perfecting the art of Predicting Employee Turnover Rate

There are many factors that HR managers need to take into account while predicting employee turnover rate. Some of the key elements include: 

•  Service time: Employees who have been with the organization for a shorter period are more likely to leave than those who have been with the company for longer. 
• Age: Younger employees are almost always looking for new opportunities and tend to leave more than older employees.
• Job satisfaction: It is closely linked with employee engagement, and if employees don’t feel engaged with the job and their roles, they become disenchanted and will not stay.  
• Compensation: Employees who feel they are not adequately compensated will leave than those who feel fairly compensated and get the market rate. 
• Workload: Employees who feel their workload is excessive are likelier to leave than those who think their workload is manageable. 
• Job market conditions: The job market conditions are also a key factor that HR managers must consider while predicting employee turnover. If the job market is good, employees are more likely to leave their current company in search of a better job. 

In today’s world, you can use digital solutions such as employee engagement survey software and data analysis to measure employee turnover. If you take pains to learn the basics of any new strategy, you will be well-suited to make data-driven predictions about employees leaving or staying. You can accomplish much through predictive analytics, giving you valuable insight into potential employee problems. This data leads to insightful information about employees considering leaving a company. HR can turn this insight into an opportunity to improve the company and retain valuable employees. 

Knowing the reasons for employees leaving before they do is crucial. You can leverage employee engagement survey tools to hear from your employees firsthand about what they think of your company. Employee attrition surveys will allow you to know what causes your employees’ dissatisfaction, enabling you to create solutions that keep the best performers from leaving. 

Conclusion

There are several factors that HR managers should take into account when predicting employee turnover rate. By understanding these factors and monitoring them closely, HR managers can develop strategies to reduce turnover and improve retention.Using technology-enabled employee management solutions can take you several steps closer to higher employee retention.

Also Read:

Proven Employee Retention Strategies in 2022