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How it works

Employee turnover cost calculator

Each time someone leaves, you pay to hire and train a replacement, you lose output while the new person gets up to speed, and you cover the empty job in the meantime. Multiply that by the number of people who left in a year and you have your annual turnover cost.

The calculator also gives your turnover rate, so you can track both numbers from one year to the next.

The figures filled in are examples so you can see how it works. Replace them with your own numbers. Nothing you type leaves this page.

Your workforce

Headcount at the start of the year plus headcount at the end, divided by 2.

Count everyone who left, whether they quit or were let go.

Your share of payroll taxes, benefits and insurance as a % of pay. Leave at 0 if you don't know it.

Replacing one person

Job ads, agency fees, screening and background checks. Our cost per hire calculator can work this out.

Compared with someone fully trained. Half as productive is 50.

While the job is empty

Overtime or temp cover. Enter 0 if the work simply doesn't get done.

Your estimate

Estimated yearly cost of turnover

$61,920

Annual turnover rate
24%
Average monthly rate
2%
Cost each time someone leaves
$5,160
People replaced
12
Hiring a replacement
$1,500
Training24 hrs × $25
$600
Lost output while ramping up$720 a week × 6 weeks × 50% short
$2,160
Cover while the job is empty3 weeks × $300
$900
Per person who leaves
$5,160

Estimates for planning only, based on the numbers you entered.

How this is calculated

Every figure comes from the numbers you enter. Nothing is filled in from averages or outside data.

Annual turnover rate
employees who left during the year ÷ average number of employees × 100
Average monthly rate
annual turnover rate ÷ 12
Weekly pay cost
hourly wage × hours per week × (1 + payroll costs %)
Training
training hours × hourly cost of the trainer
Lost output while ramping up
weekly pay cost × ramp-up weeks × (100% − output during ramp-up %)

Pay stands in for the value of a week's work. If the role earns you more than it costs, the real figure is higher.

Cover while the job is empty
weeks empty × cost of cover per week
Cost each time someone leaves
hiring cost + training + lost output + cover
Yearly cost of turnover
cost each time someone leaves × employees who left

The turnover rate uses the same method as the U.S. Bureau of Labor Statistics in its Job Openings and Labor Turnover Survey (JOLTS), which computes separation rates by dividing separations by employment and multiplying by 100 (BLS Handbook of Methods). BLS publishes monthly separation rates by industry in Table 3 of the JOLTS release. Those are monthly figures, so compare them with your average monthly rate.

Where to start cutting turnover

  • Find out when people leave

    Sort last year's leavers by how long they stayed. If a lot of them went in the first 90 days, look at how you hire and how you run the first weeks. Our guide to reducing early turnover among hourly employees covers both.

  • Tell candidates the hard parts

    Shift times, mandatory overtime, the physical side of the job and the real pay all belong in the interview. People who hear them up front and still say yes aren't surprised in week one.

  • Shorten the ramp-up

    A written checklist for the first week, a named person to ask and a check-in at day 30 can cut the time it takes a new hire to work without help. Fewer ramp-up weeks lower the lost output line above.

  • Price one leaver

    The cost each time someone leaves is the number to keep in mind. Hold it up against a pay rise, a shift bonus or a better schedule and see which one pays for itself.

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