What costs are associated with turnover? What benefits can be derived from turnover?
Employee turnover has a very large impact on businesses. Studies by American Management Association and others have identified that the costs for a company can be anything from 25% to 250% of the annual salary per existing employee. It is a rule of thumb that the level of the job has a direct impact on the costs range. For instance, an entry level individual or an unskilled position tend to be on the lower range as compared to the executives, and managers which are on the higher end.
There are a number of costs, which are associated with turnovers. These include:
a) Exit Costs: Here the costs involving human resources, managerial handoff, involuntary termination, lost customers and contacts, and also lost knowledge are included.
b) Absence Costs: These include the need for coverage, where the company needs to find someone else to take up and cover for the lost employee, direct ...
The solution provides a detailed explanation of the costs involved in employee turnover. Also, the main benefits are also discussed in detail. Several references are also provided for further readings.