Employee Attrition Rate Calculator
Result:
Understanding Employee Attrition Rate
Employee attrition rate, often referred to as employee turnover rate, is a crucial metric for understanding the stability and health of an organization's workforce. It measures the percentage of employees who leave a company over a specific period.
Why is Attrition Rate Important?
- Cost of Replacement: Replacing an employee can be expensive, involving recruitment costs, training, and lost productivity during the onboarding phase. A high attrition rate can significantly impact a company's bottom line.
- Morale and Productivity: High turnover can negatively affect the morale of remaining employees, potentially leading to decreased productivity and engagement.
- Knowledge Loss: When experienced employees leave, valuable institutional knowledge and expertise depart with them.
- Employer Branding: A persistently high attrition rate can damage a company's reputation as an employer, making it harder to attract top talent.
How to Calculate Employee Attrition Rate
The most common method to calculate employee attrition rate involves the following formula:
Attrition Rate = (Number of Employees Who Left During Period / Average Number of Employees During Period) * 100
To calculate the Average Number of Employees, you can use:
Average Employees = (Employees at Start of Period + Employees at End of Period) / 2
Alternatively, a simpler and often used method, especially for shorter periods or when employee numbers fluctuate significantly due to hiring, is:
Attrition Rate (Simplified) = (Employees Who Left During Period / Total Employees at Start of Period) * 100
This calculator uses the simplified method for ease of use.
Example Calculation:
Let's say a company starts the quarter with 100 employees. During that quarter, 15 employees leave, and 10 new employees are hired.
Using the simplified formula:
- Employees Who Left = 15
- Total Employees at Start = 100
- Attrition Rate = (15 / 100) * 100 = 15%
This means that 15% of the workforce at the beginning of the quarter left the company by the end of it.