How to Track and Reduce Employee Turnover

People come and go in any job, but for contact center leaders, turnover can be a significant problem. And during a recession when budgets are tighter than normal, retaining great contact center talent is particularly important.

Solving high employee turnover isn’t as simple as throwing pizza parties and handing out gift cards for attendance.

So how do you track and reduce employee turnover?

 Let’s first look at the types and costs of turnover before we examine proven retention strategies you can employ in your own business. 

Identifying the Four Kinds of Employee Turnover

Internal Voluntary: This is when an employee pursues a position within your organization. Internal turnover is often viewed as positive (in the case of promotions, or cross-training strategies) but could be negative if employees are looking to escape poor management or stressful working conditions.

Internal Involuntary: This is when an employer makes the decision to shift an employee’s role and responsibilities. Examples of this type of turnover could include a leadership promotion, a reassignment based on changing business needs or a performance-based demotion. 

External Voluntary: This type of turnover is when an employee voluntarily chooses to resign from the organization. Voluntary turnover could be the result of a more appealing job offer, staff conflict, or lack of advancement opportunities.

External Involuntary: This type of turnover is when an employer chooses to release an employee from the organization. Involuntary turnover could be a result of poor performance, staff conflict, the at-will employment clause, etc. 

Each type of turnover should be tracked monthly and annually using both actual and average measurements. These calculations enable contact center leaders to understand how their turnover may change from month to month, as well as to understand overall trends on a monthly or annual basis. 

How to Calculate Employee Turnover           

Scenario: A contact center typically has filled 50 positions. Over the course of one month, they employed 63 different people. At the end of the month, 46 positions were filled and 4 were vacant. In total, 17 people quit or were terminated during the month. 

Monthly Actual (Calculated each month):

17 (total # of people lost during the month) / 63 (total # of employees during the month) 17/63 = .269 

.269 X 100 = 26.9% actual attrition rate for the month

These next few calculations use example numbers to demonstrate how turnover can be measured as a monthly average, annual actual, and annual average. 

Monthly Average (Calculated over the course of several months):

12 (average # of people lost per month) / 56 (average # of employees per month) 12/56 = .214

.214 X 100 = 21.4% average monthly attrition over the past M # of months

Annual Actual (Calculated each year):

86 (total # of people lost during the year) / 718 (total # of employees for the year) 86/718 = .119

.119 X 100 = 11.9% actual attrition rate for the year

 

Annual Average (Calculated over the course of several years): 

75 (average # of people lost per year) / 724 (average # of employees per year) 75/724 =.103

.103 X 100 = 10.3% average attrition rate over the past Y # of years                   

Uncovering the Reasons for Employee Turnover    

If knowing how many people are leaving and where they’re going is step one, then understanding the reasons why they’re leaving is step two. There are many possible reasons for people to leave a job or a company and it’s your responsibility to understand these causes if you ever want to affect them. 

Here are some ideas for gathering insights on your turnover. 

1. Conduct Stay Interviews

Meet with current employees and ask them about things that they’d like to see started, stopped, or continued in their work. Have conversations about their stress levels, workload, interactions with others in the business, etc. If they’re being honest, you should have a pretty good sense of why people are happy and why they’re not. 

2. Review Recruiting and Onboarding Materials

Is the job accurately described to candidates? Does onboarding and new hire training effectively prepare people for the job? Are you able to identify and address potential job fit concerns earlier in the hiring and onboarding process?

3. Analyze Exit Interview Data

We’ll be the first to admit that exit interviews are a flawed science. Gathering meaningful data can be difficult but it’s not impossible. What can you learn from these final conversations to prevent others from leaving for the same reason? 

4. Look Below the Surface

Beyond what agents are telling you, be on the watch for other trends that could be the true indicators of turnover. Analyze turnover data by things such as recruiting source, hire dates, time of year, or agent supervisor.

Understanding the Cost of Employee Turnover 

We can probably all agree that turnover is costly but how much does it cost us, really? We suggest measuring turnover costs in four distinct categories.

1. Separation Costs

Potential expenses that you incur when an employee leaves include severance pay, benefits continuation, unemployment insurance rates, administrative costs, outplacement/job assistance, and legal fees. 

2. Recruiting and Hiring Costs

Attracting new talent is rarely cheap or easy. Potential costs might include placing job ads across different media outlets, search firm fees, relocation benefits, travel for recruiting or candidate interviews, background checks, and time spent by the talent acquisition team. 

3. Training and Orientation Costs

The cost of training and orienting new employees can quickly grow ambiguous but it’s important to have a good sense of the investment it takes to get people proficient in their job. The cost of training and onboarding is often equated to the time and salaries spent on new hire orientation and training but can also include expenses tied to training experiences (such as access to free products or services). 

4. Indirect Costs

When employees leave the job, there’s an inevitable ripple effect that happens across the contact center. This results in hidden costs to the business that can include lower productivity and decreased service levels, overtime costs for employees to cover vacant shifts, and lost business because of decreased customer service levels. 

Strategies for Retaining Employees

Below are proven strategies you can use to decrease agent turnover and ensure that your workforce is engaged, happy, and healthy.

• Provide new hires with an effective orientation and training experience
• Offer competitive pay and benefits
•  Understand and address the causes of turnover
•  Create opportunities for ongoing skill and career development
•  Provide as much schedule flexibility as possible
•  Deliver coaching and feedback on a consistent basis
•  Communicate expectations clearly and encourage open dialogue regularly
•  Reward and recognize employees in a personal and meaningful way
•  Connect people to their larger team – in the contact center and beyond – to help them see how they contribute to the organization’s overall success
•  Celebrate successes and partner together to overcome the challenges

By employing these strategies, you’ll improve your organization’s work culture, decrease voluntary turnover, and improve employee engagement.

Learn more about how to retain great talent by downloading our free white paper: Reversing the Great Resignation: Proven Strategies for Improving Agent Retention.