### Workplace Turnover Formula

Here is the Workplace Turnover Formula.

You can download for your own copy.

SMART WORK ETHICS

Workplace Turnover –Let’s do the Math

What does it cost your bottom line when you have employee turnover?

U.S. Department of Labor reports that employee turnover cost is between 30% to 200% of a worker’s annual salary.

THE COST OF EMPLOYEE TURNOVER

—Pre-departure Costs

—Termination Costs

—Recruitment Costs

—Training Costs

—Productivity Costs

—Vacancy Costs

—Hidden Costs

The formula:

Multiply the number of employees by turnover rate by wage per hour by hours per week by weeks per year by 30% cost of turnover. This is turnover cost. Divide by Profit Margin. Total is increased sales needed to make up cost of turnover.

Example:

25 employees

X turnover rate (36%) (9 employee positions per year)

X hourly rate (8.50)

X hours per week (40)

X weeks per year (52)

X cost of turnover (30%) (number from U.S. Department of Labor)

= total cost of turnover

25 X 36% X $8.50 X 40 X 52 X 30% = $47,736.00

Now, divide by profit margin (20%) (example)

$47,736.00 divided by 20% =

$238,680 Total number of sales needed to make up for turnover.

Now do your own numbers! See next page.

Workplace Turnover –Let’s do the Math

________ (Number of employees) X _______ (your turnover rate)

X ________ (hourly wage) X ________ (hours per week) X

________ (weeks per year) X ________ (cost of turnover (30%)

= __________________(total cost of turnover)

NOW—Divide by your profit margin

= _____________ (total cost of sales to make up for turnover)

YOUR turnover rate is determined by dividing the number of workers who have left by the number of workers when you have a full staff to carry out the functions of your company.

Example: 10 people have left (three for the same position)

Total number of workers necessary to carry out the functions of your company 37

10 divided by 37 = 27% turnover rate for your company

When you are ready to change this number give us a call.

SmartWorkEthics.com is a division of

THE SMART SOLUTIONS GROUP

Joanie S. Stephen

(251) 990-2507 (888) 759-3712 195 Pemberton Loop Fairhope, AL 36532

http://www.SmartWorkEthics.com Joanie@SmartWorkEthics.com

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