Monthly Employee Turnover Rate Calculator
Calculate your workforce attrition percentage quickly and accurately.
Understanding How the Monthly Turnover Rate Percentage is Calculated
Employee turnover is a critical metric for HR professionals and business owners. It measures the rate at which employees leave a workforce and are replaced. Understanding the monthly turnover rate percentage is calculated as a ratio allows businesses to track retention health, estimate hiring costs, and identify management issues.
The Formula
To determine your monthly turnover rate, you need three specific data points: the number of employees at the start of the month, the number at the end, and the total number of separations. The standard formula used by HR professionals is:
Turnover Rate = (Separations / Average Number of Employees) × 100
Where the Average Number of Employees is calculated by adding the beginning headcount to the ending headcount and dividing by 2.
Step-by-Step Calculation Example
Let's look at a practical example to clarify the process:
- Step 1: Determine the headcount on the 1st of the month (e.g., 200 employees).
- Step 2: Determine the headcount on the last day of the month (e.g., 196 employees).
- Step 3: Count the total separations during that month (e.g., 8 employees left).
- Step 4: Calculate the average: (200 + 196) / 2 = 198.
- Step 5: Divide separations by the average: 8 / 198 = 0.0404.
- Step 6: Multiply by 100 to get the percentage: 4.04%.
Why Monitoring Turnover Matters
A high turnover rate can indicate dissatisfaction with company culture, compensation, or management. Conversely, a very low turnover rate might suggest stagnation. By calculating this metric monthly, you can spot trends seasonally or immediately following major organizational changes.
What counts as a "Separation"?
When inputting data into the calculator, ensure you include all types of departures:
- Voluntary: Resignations and retirements.
- Involuntary: Terminations and layoffs.
- Other: Deaths or disability-related departures.
Note: Usually, temporary employees or internal transfers are excluded from this specific calculation depending on company policy.