Understanding employee turnover rates

Let’s talk about turnover (and not the flaky pastry kind). Employee turnover is more than just a metric — it’s a message. When people leave, they’re telling you something. The real challenge? Figuring out what that something is, and how to fix it before your best people walk out the door.

In this article, we’ll unpack the most common reasons employees leave, how to calculate your turnover rate without needing a PhD in math, and what to do about it. Because when you understand what’s driving turnover, you can start shaping a culture where employees feel seen, supported — and motivated to stick around.

How to calculate employee turnover rates

Turnover rates might not be the most thrilling numbers on your dashboard — but they speak volumes about the health of your company culture. The good news? You don’t need a finance degree or a crystal ball to make sense of them. Just a simple formula, a bit of patience, and maybe a strong coffee.

Here’s the basic formula:

For example, if the average number of employees is 90 and 6 employees left during the year, your turnover rate would be:

Now let’s break that down into bite-sized steps — no calculator panic required.

1. Set a timeframe that works for your team

Before you do anything else, pick a timeframe to measure — monthly, quarterly, annually — whatever makes sense for your business. Each view tells a different story: shorter windows help spot quick shifts, while annual numbers reveal long-term patterns (and whether your retention strategy is actually, well, working).

2. Find your average headcount for that period

Start by recording how many employees you had at the beginning and end of your chosen timeframe. Add those two numbers together and divide by two — that’s your average headcount.

Easy math — we promise that’s the hardest part.

3. Tally up your employee departures

Count how many people left during that period — yes, all of them. That includes resignations, retirements, terminations, and layoffs. Voluntary or not, they all contribute to your turnover story.

4. Do the division (just this once)

Take the number of employees who left and divide it by your average number of employees. This gives you the turnover rate as a decimal.

5. Make it make sense — convert to a percentage

Multiply that decimal by 100 to turn it into a percentage — something you can actually use in presentations, dashboards, and awkward boardroom chats.

Voilà. That’s your turnover rate — a small number that can reveal big things. And once you’ve got it, you can start digging into what’s really behind it — and how to keep your top talent right where they belong.

Reading between the lines of your turnover rate

So, you’ve crunched the numbers and calculated your turnover rate. Now comes the fun part — figuring out what it’s actually trying to tell you.

A high turnover rate isn’t just a red flag — it’s more like a flashing neon sign that something’s off. Maybe it’s compensation. Maybe it’s culture. Maybe it’s something in the water (spoiler: it’s usually leadership). On the other hand, a low turnover rate often points to a stable, disengaged workforce that’s feeling seen, heard — and sticking around for a reason.

Here’s a quick look at what your turnover rate might be whispering (or shouting):

High turnover might be saying:

• “I’m not getting paid enough for this.”
• “Where’s my future here?”
• “My manager doesn’t get me.”
• “This culture isn’t it.”

Low turnover could be telling you:

• “People are happy — and it shows.”
• “Roles are aligned with expectations.”
• “Employees feel engaged and valued.”
• “Compensation is competitive enough to stick around for.”

No two companies are the same, which means turnover will always have a few unique layers. But whatever the rate, it’s a powerful launch point to explore what’s really driving employees out the door — or keeping them in their seats.

The usual suspects: Common causes of high turnover

Let’s take a closer look at some of the usual contributors to turnover. None of them are new — but if they’re lingering in your workplace, your people probably won’t be for long:

• Poor management: When employees feel unsupported, unheard, or undervalued, they look for greener (and better managed) pastures.
• Stalled career growth: A dead-end job rarely inspires loyalty. If growth feels out of reach, so does long-term commitment.
• Inadequate compensation: If pay doesn’t meet market expectations, you’ll find yourself training replacements on repeat.
• Toxic culture: If inclusion is lacking and bad behavior is swept under the rug, even the most dedicated team members will eventually look for an exit.

Your takeaway?

Don’t treat turnover as just another KPI — it’s a signal, and sometimes, a siren. The more clearly you read it, the better equipped you are to respond with real, lasting change. And remember: If you want to keep your best people, they need more than a paycheck. They need purpose, growth, and a culture that recognizes their impact — often and authentically.

Which, coincidentally, is where Achievers shines.

The real cost of high turnover (spoiler: it’s not just financial)

Turnover isn’t just a line on a spreadsheet — it’s a ripple effect. When employees leave, it costs money, time, energy, and often a few too many “who’s covering that now?” meetings. Let’s break down what high employee turnover really means for your business, beyond the obvious.

It’s expensive — and not in a fun way

Replacing a single employee can cost anywhere from 40% to 200% of their salary, depending on the role. That’s not pocket change — that’s budget-reforecasting, strategy-delaying, CFO-cringing kind of money.

But it’s not just the recruiting, onboarding, and training costs. There’s also the productivity hit — because new hires need time to ramp up. And don’t forget the toll on those who stay behind. Watching colleagues leave can take a toll on employee morale and engagement. Eventually, people start to wonder if they’re next — and not in a fun “promotion next” kind of way.

It chips away at your culture

Every time someone walks out the door, they take more than a badge and a branded mug. They take relationships, know-how, and institutional memory — and sometimes leave a hefty workload behind.

That workload doesn’t disappear. It lands on someone else’s desk. And when that starts to pile up, so does the frustration. High performers might succumb to burnout. Others may begin to question if the culture is as healthy as it claims to be.

And word gets out. Because nothing travels faster than Glassdoor reviews from someone who left on a sour note.

It quietly slows your growth

Here’s where it gets serious. High turnover doesn’t just disrupt the day-to-day — it derails the big picture. Frequent departures can stall long-term projects, weaken customer relationships, and fragment strategic momentum.

When institutional knowledge is constantly walking out the door, it’s harder to maintain consistency across operations, leadership, and culture. Eventually, this can dent your employer brand and make it harder to attract and retain talent you desperately need to turn things around.

Strategies to reduce employee turnover — before your top talent becomes someone else’s

Let’s be honest: great employees don’t usually leave because they feel too appreciated, too supported, or too fulfilled. Reducing turnover isn’t about magic — it’s about being intentional. That means building an organizational culture where employees feel recognized, rewarded, and empowered to grow.

Below are a few strategies that do more than just retain employees — they help them thrive:

Build a culture that actually feels good to work in

Want people to stick around? Start by making work feel like a place they want to be — not just have to be. That means recognizing achievements often (and meaningfully), building a culture of appreciation, and making it clear that their contributions matter.

Engagement and retention initiatives like employee recognition programs aren’t just nice to have — they’re essential. Done right, they boost morale, reinforce the behaviors you want to see more of, and make employees think twice before polishing up their résumés.

And let’s not forget wellness. Offering support for physical, mental, and emotional health — think gym memberships, mental health days, or resources to help with work-life balance — sends a loud, clear message: we care about you as a person, not just a job title.

When employees feel seen, supported, and celebrated, they’re more likely to stay — and more likely to succeed.

Invest in growth — and watch loyalty grow with it

Here’s a thought: If employees can grow their careers at your company, they won’t need to go elsewhere to do it. Providing clear opportunities for learning, upskilling and reskilling, and advancement shows people that their future is here — not out there.

Professional development isn’t just a perk — it’s a proven retention tool. It prepares your team for leadership roles, reduces your dependency on external hires, and saves on recruiting costs. Plus, it reinforces trust: when people know their company is investing in their success, they’re more likely to return the favor with long-term commitment.

Whether it’s through training programs, mentorship opportunities, or leadership pipelines, building clear career paths pays off — in performance, morale, and retention.

Cultivate a committed, engaged workforce — the Achievers way

Building a workplace where people want to stay — and grow — starts with culture. When employees feel recognized, supported, and heard, they don’t just show up — they show up engaged. That’s where Achievers makes the difference.

Achievers helps organizations create lasting cultures of appreciation by turning everyday moments into meaningful recognition. And by making it easy to listen and respond to employee feedback, Achievers empowers leaders to act on what matters most.

The result? Less guesswork, more connection — and a workforce that feels valued, energized, and ready to stick around for the long haul.

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