5 Reasons Why Employee Turnover Is Always Bad for an Organization

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The employee turnover refers to the number of employees that choose to leave in a certain period. Usually, the industries and organizations consider this number over a calendar or fiscal year. If you have a high turnover rate, this means that there is a problem somewhere. Today we are going to have a look at why employee turnover is always bad for your organization.

Ways in Which Employee Turnover Is Always Bad for Your Organization

1. It Decreases Performance

This is a simple and clear effect of a high employee turnover rate. Various studies have shown that after the turnover rate increased, the customer service and the profit margin suffered. Moreover, it’s clear that a worker who has less experience will sell less high-value solutions or optimize the service in the right manner.

2. Incomplete Tasks

Whether it’s on the short or long run, an employee turnover may leave you with some incomplete tasks each day. For example, if you need 10 employees for a project, and you find yourself in the situation of working with only 7 (or even less!), you should cover the rest of the work. And it can be hard to find out competent people in such a short time.

3. High Costs

One of the reasons why employee turnover is always bad for an organization is the fact that they cost you money. Every time someone leaves, you must replace them. Hiring and training new personnel can cost a lot, reaching even half of the salary of an unskilled worker. If we’re talking about a high-level manager, the cost can be equal to 3-5 times their annual pay. But you don’t deal only with training costs, but also with exit interview costs, new openings and background and reference checks.

4. Less Information

If most of the employees are new, this means that they are not familiar enough with the tasks and the information they should know. Furthermore, this translates to longer times of completing a task and repeating the same information all over again. What’s more, the more valuable a position inside the company is, the more negative impact the turnover will have.

5. Negative Team Dynamics

And so, we reach the last reason why employee turnover is always bad for an organization. We all know how hard it is to have a united and coherent team. Imagine that just when your employees are friends with each other and get along, one of them (or more) leaves. Naturally, this will affect the team dynamics and the way they work together. Moreover, the person who replaces the employee can be completely different, and this will ruin the entire coherence of the team.

Conclusion

Though there are indeed ways of dealing with an employee leaving, employee turnover is always bad for an organization. It affects the work dynamics, the costs you should make, the time and the professionalism of the entire staff. Because of this, it’s always useful to be prepared beforehand and to quickly find a solution. Don’t forget to maintain a coherence at the level of your team as well.

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Author: Amanda Knowles

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