Staff Turnover Rates Drop as More Employers Get Retention Right


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According to a survey of Australian HR practitioners, shows that nearly a third of respondents expect staff turnover to fall in the next 12 months, which means fewer will be quitting their jobs.

Nearly half of the HR people expect turnover to remain steady from a relatively low base.

The Australian Human Resources Institute survey of 561 respondents finds an average turnover rate of 13 per cent for the past 12 months just past, compared to 18.5 per cent five years ago (when people were more likely to be optimistic).

AHRI chairman Peter Wilson says: “By usual standards, that rate would be regarded as a number more in keeping with best practice: Enough to enable fresh blood and renewal, but not so great as to indicate that years of staff investment are walking out the door or that the costs of replacement will be prohibitive and destabilising.”

Medium-sized businesses are losing staff at the highest rate: with 17 per cent of employees leaving among businesses of 250-499 employees; 11 per cent for businesses with fewer than 99 employees; and 10 per cent for businesses of 1000 or more employees.

“The figures suggest that perhaps more businesses are getting recruitment and retention right,” Wilson says.

“On the other hand, the relatively low rate might indicate that employees are showing a reluctance to move, with confidence low and wages flattening out in a prevailing mood of business uncertainty, and significant risks of lower growth and higher unemployment next year.”

Other findings include:

• Despite the figures, nearly half the respondents (47 percent) believe that turnover in their organisation is too high.

• The three top reasons respondents report on why people leave organisations are lack of promotional opportunity (20 percent), poor relationship with manager (17 percent), and insufficient pay (12 percent).

• Respondents report the three most common interventions for improving retention are better induction processes (12 percent), improved employee communication (12 percent) and better selection techniques (10 percent).

• Around six out of ten respondents (59 percent) see the brand of their organisation as a positive retention factor, while 11 percent see brand as a negative.

• As a way of measuring the effectiveness of retention, exit interviews are the most common technique reported.