Voluntary Turnover Rates on the Rise

September 28, 2004 (PLANSPONSOR.com) - Voluntary turnover is on the rise, according to a report by Compensation Resources, Inc., (CRI).

The average voluntary turnover rate was 11.3% from March 2003 to the same month in 2004. Overall, turnover rate, both voluntary and involuntary, was 17.6%. The majority of respondents to the survey, stated that this number had either increased or stayed the same in the past 12 months. Only 20.9% of respondents thought that this rate had decreased.

The industries with the highest voluntary turnover rates are business services and sales, with 20.7% and 13.4% turnover rates respectively. Overall turnover rates in these industries were 26.5% and 26.8%.

Of all employee functional groups, Administrative and Production level positions show the highest voluntary turnover rates, and also take the shortest amount of time to fill. The CRI survey reported that overall, the cost of turnover to organizations is on average between one-half to one times the employee’s salary.

Industries with low voluntary turnover are Engineering, Manufacturing, Pharmaceuticals, and Utility/Energy, with 5.5%, 4.2%, 8.1%, and 3.6% voluntary turnover rates respectively. The overall turnover rates in these industries were, in the same order, 8.4%, 7.4%, 13.5%, and 6.4%.

Participants in the survey also indicated that employees usually leave current jobs because of better pay options, better opportunities, and increased responsibilities elsewhere. Another reason is involuntary layoffs.

CRI, a compensation and human resources consulting firm, polled companies in over 10 separate industries. For a full list of industries with their voluntary and total turnover rates as well as commentary see the survey.