Attrition (Turnover)

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What is Attrition? Meaning.

Attrition is in Human Resources management and in employee retention the rate at which a workforce is gradually reduced due to employees leaving a firm. It is a measurement of how many employees leave a company and are not replaced within a given period.

The rate of attrition is also referred to as the "Churn Rate".

Employee Turnover is also a very similar term, but it has a slightly different feeling associated with it. See below.

Types of Attrition/Turnover

One can distinguish different kinds of attrition and/or turnover:

• Voluntary Attrition - When employees voluntarily choose to resign through normal means (a more appealing job offer, lack of advancement opportunities, a staff conflict, retirement, resignation). It may or may not also include employees permanently incapacitated for work and deceased persons. This category can be further split up into:
  • Functional Attrition - When low-performing employees leave the organization. The company just respects the decision by the employee to leave, rather than having to go through the paperwork and potentially difficult process of proving that an employee is inadequate.
  • Dysfunctional Attrition - When high-performing employees leave the organization (for example as a result of a better job offer, a lack of career opportunities). As this is costly, companies want to avoid/lower this category.
• Involuntary Attrition - When employees are unwillingly dismissed by a decision from their employer (as a result of poor performance, a staff conflict, forced labor reductions, firing, mass layoffs). The US Bureau of Labor Statistics uses the term "Quits" to indicate voluntary turnover and "Total Separations" for the combination of voluntary and involuntary turnover.
• External Attrition - When employees decide to leave and work for another company. This could be due to factors like compensation, commute or perhaps they feel more aligned with another company's values.
• Internal Attrition - When employees leave their current position for another role within the same company. They may have received a promotion or they might be involved in Job Rotation.

Calculating Attrition/Turnover Rate. Formula

The Attrition Rate can be calculated by dividing the the number of people who have left the company over a period of time by the average number of employees over that same period of time x 100. It is typically expressed as a percentage (%).

For example, let's say a company had an average of 500 employees during a year. In that same period, 25 people left the company for various reasons.

Annual Attrition Rate = # of leavers / avg # of employees x 100

Annual Attrition Rate = 25 / 500 x 100

Annual Attrition Rate = 5%

Likewise, you can also analyse the attrition rate over a specific timeframe like perhaps the probation period of new employees.

For example, a company had 15 new employees joining the firm. However, 5 of those 15 newcomers already quit during the probation period for various reasons.

Probation Attrition Rate = # of leavers / total # of new hires x 100

Probation Attrition Rate = 5 / 15 x 100

Probation Attrition Rate = 33%

Likewise, attrition can be also used to indicate the action of not filling openings created by voluntary resignation and normal retirements.

Ways to Lower the Attrition/Turnover Rate

To avoid employee disengagement and resulting attrition, companies typically use a number of mechanisms:

• Increase the Organizational Commitment of employees
• Set clear objectives. Compare: Management by Objectives
• Match employees well with their job. Compare: Employability
• Give employees opportunities to reach their full potential. Compare: Employee Development
• Give employees room, power and discretion to accomplishing their goals. Compare: Empowerment of Employees
• Assign meaningful work to employees
• Inform employees well about relevant matters
• Listen to employees
• Establish healthy work environment

Employee Turnover versus Attrition

Employee Attrition and Employee Turnover are similar terms, but they're not the same:

• Both pertain to the loss of workforce and are components of retention that HR professionals need to consider.
• However, a difference between the terms is that turnover is usually viewed negatively and reflects that the company has to fill the vacancy as soon as possible. Attrition on the other hand is viewed more neutral and reflects that vacancies left by attrition aren't necessarily immediately filled up.

Forum Forum about Attrition. Start a new topic Share your knowledge or ask a question   🔥 NEW WHEN to Quit, Resign from your Job? Our purpose of work will shift over time. When feeling stagnant, it is natural for us to think about having a change. At this time, we usually have two options: either redesign what we are doing now o... 13   10 comments Griffeth and Hom Employee Turnover Model What is the Griffeth and Hom Turnover model (2001)? Thanks for your help.... 10   1 comments HOW to Quit your Job Elegantly Is it time to turn the page and start a new chapter? Looking for a well-paying job, pursuing higher studies, longing for a different work environment or a need for work-life balance are considered som... 7   6 comments How to Effectively Communicate your Resignation? Suppose a person gets a better job opportunity which he/she has always wanted to pursue, but the new organization is expecting immediate joining. How to communicate effectively that you are resig... 7   12 comments Employee Furlough The word "furlough" recently has got some prevalence due to COVID-19. What does it actually refer to? Employee Furlough (EF) is often misunderstood as being the same as employee layoff. However i... 7   2 comments Employee Ghosting Ever wondered why - out of the 5 candidates recruited by your firm - only 2 showed up to work? Or have you heard about an employee working in your department who suddenly stopped showing up for work o... 4   1 comments Motivation is an Important Factor in Employee Retention A number of organisations are finding it difficult to retain key staff members today due to their inability to motivate them towards effective performance. Where the motivation of employees is ve... 4   1 comments Employee Loyalty During Recession How does one keep the remaining employees loyal to the organization after redundancy due to recession?... 4   1 comments HR Measures to Reduce Attrition How can the Human Resources department help to reduce employee turnover? What are the options we can think of?... 3   1 comments

Best Practices The best, top-rated topics about Attrition. Here you will find the most valuable ideas and practical suggestions. Pre-Quitting Behaviours: 13 Signs that your Employee Might Quit Dissatisfaction at work, a search for better career prospects (i.e., role or salary or company or industry), or a yearning for higher education are some of the main reasons why employees choose to lea... 16   7 comments Goodbye... Managing Employee Offboarding Organizations spend a lot of time, effort and money on onboarding new employees. Just think of creating an attractive corporate reputation and image, employer branding, pre-employment screening and re... 11   11 comments Advantages of Employee Retention? Benefits I would like to know what is the significance of employee retention in HRM practice? Who has a good list of benefits / advantages of keeping employees onboard? Thanks in advance.... 8   4 comments

Expert Tips Advanced insights about Attrition. Here you will find professional advices by experts. Why Employees Stay: Contextual Factors Influencing Job Embeddedness Employee Retention, Attrition, Organizational Commitment, Employee Satisfaction Mitchell, Lee and Tyler (2014) focus on the contextual (or external) factors that influence employees’ staying, instead ...

Information Sources Various sources of information regarding Attrition. Here you will find powerpoints, videos, news, etc. to use in your own lectures and workshops. Managing Employee Separation and Employee Retention Employee Turnover, Employee Retention, Employee Separation, Discipline, Layoffs, Dismissing, Employee Termination Presentation about the retention and separation of employees, including the following sections: 1. Learning Objectives ... Reasons and Secrets of Employee Retention Employee Retention, Attrition This presentation is about Employee Retention and includes the following sections: 1. Introduction 2. Reasons for Empl... The Employee Commitment Pyramid Employee Commitment, Employee Motivation Stum (2013) developed the so-called Performance Pyramid. His model is clearly based on Maslow’s Hierarchy of Needs. But ...

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