What is employee turnover rate?
Employee turnover rate metric measures how often employees leave an organization and are replaced by new employees.
How to calculate employee turnover rate?
To calculate the employee turnover rate, divide the ‘number of employees who left’ in a period by the ‘average total number of employees’ in the same period and multiply by 100. The average total number of employees will be calculated by – adding starting number and ending number and dividing by 2.
Formula for calculating employee turnover rate

Real-life example of employee turnover rate
Let’s say you employed an average of 360 employees in your company the previous year. During the year, your company lost 17 employees. Then, your employee turnover rate will be: 17/360 x 100 = 4.7%
What’s considered a good employee turnover rate? (Benchmark)
An employee turnover rate of 10% or less is generally considered healthy. However, this benchmark can vary depending on factors such as industry norms, company size, and job roles. For instance, sectors like retail, staffing, hospitality, and fast food typically experience higher turnover rates.
In contrast, lower turnover rates often indicate a more engaged, satisfied, and stable workforce, which is a strong signal of organizational health. Many companies aim for a 90%+ employee retention rate as a goalpost for strong internal culture and operational stability.
If your company’s turnover rate is significantly above the average for your industry, it may be time to examine possible red flags, such as poor management practices, lack of growth opportunities, or inconsistent scheduling. In such cases, tools like an employee time and attendance system can help bring transparency to absenteeism patterns, improve workforce planning, and support better employee experience, all of which contribute to lowering turnover.
Regularly benchmark your rate against similar organizations to identify gaps and make proactive improvements.
Ways to decrease your employee turnover rate
- Improve your work environment and culture: Creating a positive work environment and culture can help employees feel more satisfied and engaged with their work. Research from Deloitte shows that 94% of executives and 88% of employees think a positive corporate culture is an essential part of a company’s success. This can be achieved by providing opportunities for professional development, offering flexible work arrangements, and rewarding good performance.
- Provide competitive compensation and benefits: Offering competitive compensation and benefits can help attract and retain top talent. This includes offering competitive salaries, bonuses, and incentives, and annual incentive plans, as well as providing comprehensive health insurance and other benefits such as retirement plans and paid time off. In order to manage these benefits and generally meet employee needs more effectively and efficiently, it’s necessary to implement all-in-one HR software that allows you to truly live up to the promises you make to the people on your staff.
- Invest in employee training and development: 94% of employees said that they would stay longer with a company that invested in their careers. Providing employees with training and development opportunities as well as investing in mentorship platforms can help them grow and advance in their careers, which can make them feel more fulfilled and satisfied in their jobs.