Employee turnover rate

Employee turnover rate measures what fraction of a workforce leaves during a period, usually a year, and is calculated as employees who left / average headcount x 100. It is typically split into voluntary turnover, employees who resign, and involuntary turnover, terminations and layoffs, because the two have very different causes and implications.

Some organizations further separate "regrettable" turnover, the departure of employees managers wanted to keep, from non-regrettable turnover, since a headline turnover figure treats a low performer leaving the same as a top performer leaving. Turnover is also commonly reported by tenure, department or manager to locate where retention problems concentrate rather than treating the whole organization as one population.

Turnover rate is a lagging indicator, describing departures that already happened, which is why HR teams pair it with forward-looking attrition risk scores and employee engagement survey trends to anticipate losses before they occur. High turnover raises replacement costs and strains workforce planning, and low quality of hire is one of its common root causes, since poor role fit tends to surface as early departures within the first year.