Employee Turnover Cost Calculator
Calculate the true financial impact of losing and replacing an employee.
Results Breakdown
Lost Productivity (Vacancy):
$0
Hiring & Training:
$0
Total Cost per Exit:
$0
The Hidden Impact: Understanding Employee Turnover Costs
When an employee leaves your organization, the financial impact extends far beyond just a "missing person." For Human Resources and finance departments, turnover represents a significant drain on the bottom line. Research suggests that replacing an employee can cost anywhere from 33% to 200% of their annual salary depending on the complexity of the role.
What Costs are Included in Turnover?
- Direct Recruitment Costs: This includes job board postings, recruiter commissions, and the time HR staff spends screening resumes.
- Interviewing Costs: The hourly rate of every manager and peer involved in the interview process.
- Training and Onboarding: New hires are rarely 100% productive on day one. You pay for their learning curve and the time of the trainer.
- Opportunity Cost: While a position is vacant, the work isn't getting done, or other team members are burning out trying to cover the gap.
Realistic Example Calculation
Imagine a Senior Marketing Manager earning $80,000. If the position remains vacant for 45 days, the lost productivity alone is approximately $13,846. Add $5,000 in recruitment fees and $3,000 in onboarding time, and the total cost of that single exit reaches $21,846.
3 Ways to Reduce Turnover Costs
- Invest in Retention: It is almost always cheaper to give a top performer a 10% raise than to pay the 50% replacement cost after they leave.
- Improve the Hiring Process: Ensure a "culture fit" early to prevent early-stage turnover (the most expensive kind).
- Standardize Onboarding: The faster a new hire becomes productive, the lower the training cost burden on the company.