Determining employee attrition involves measuring the rate at which individuals leave a workforce over a specific period. This is often accomplished by dividing the number of employees who departed by the average number of employees, then multiplying by 100 to express the result as a percentage. For example, a company with an average of 200 employees that experiences 20 departures in a year would have a 10% attrition rate. Various methodologies exist, some incorporating factors like voluntary vs. involuntary departures, to offer more nuanced insights.
Monitoring and understanding this metric provides crucial information for strategic workforce planning, budgeting, and overall organizational health. High rates can signal underlying issues like low employee satisfaction, inadequate compensation, or poor management practices. Historically, tracking and analyzing workforce attrition has evolved from simple headcounts to sophisticated data-driven models that help organizations predict future trends and implement proactive retention strategies. This data empowers businesses to make informed decisions about talent acquisition, development, and resource allocation.
