Is employee turnover costing your company? Part 3 [Video]

Welcome back to the FineAwards.com recognition and retention roundup series on the true cost of employee turnover. By now, you’ve probably realized that replacing workers is an expensive process, but just how much is it costing your organization? Let’s find out.

{marker} Although it seems like an impossible number to figure out, there are ways you can calculate the cost of finding a new hire. Start by figuring out how many weeks the worker will remain at your company before leaving. Next, estimate how much productivity will be lost during this time – it’s usually around 75 percent. Multiply these numbers by the position’s hourly salary.

{marker} Repeat this process for the departing employee’s team, as well as his or her manager. Add them together to get the pre-departure costs. As you can see, simply preparing to replace a worker can be financially draining. Replacing a worker who earns $40,000 a year can easily cost your organization at least $16,000.

Check back soon as we continue this series and discuss the importance of retention.