Employee turnover which is also relatively known as staff turnover refers mainly to the percentage rate number of employees leaving the company and the number of new employees who replaces them over a certain period of time. Employees turnover it is not good for any organization as it increases the organization costs of recruiting and training new employees which is very costly for any organization. Employees tend to leave the company for many reasons such as lack or poor communication within the organization, managers as they act as one of the main reason for staff turnover, changes of the organization structure, poor or lack of employees engagement in decision making, paucity of motivation within the organization, lack of the organization
Essentially, turnover can generate costs for the organization whether the employee leaves voluntarily or involuntarily. Moreover, turnover can be a very costly expense to an organization. Further, turnover can highly impact the organization and cause various disruptions to operations and production. Thus, there are several cost associated with turnover. According to Stamp and Thoren (2016) turnover can be very disruptive and costly for any business or industry.
In big Companies, employees are always leaving for numerous reasons but when they do, they’re replaced with new hires. This is called Turnover rate, which every company in the World has. Ingram (2013) stated that, “In human resources terms, employee turnover refers to the rate at which employees leave jobs in a company and are replaced by new hires”(p. 1). There are always numerous reasons for leaving a company but sometimes when leaving a job, it doesn’t always pertain to not liking the job, it could be because of age or living too far away from it. When it does pertain to the job, the reason is usually because you’re not getting paid enough, or the person doesn’t like the environment.
External factors including personal conflict or opportunity from external job market can also cause turnover. Another theory by Mcbey and Kawakowsky (2001) states that there are four broad categories of turnover’s influencers: 1. Push or work-related factors, which push the worker to voluntarily separate with the organisation. These factors include work satisfaction, satisfaction with salary, and performance-reward contingencies. 2.
By retaining employees, organizations are relieved of issues such as increased training costs, lost knowledge, mourning, insecure co-workers and costly recruitment and selection processes. If employees are not retained, then the organisation suffers from the following: HIGH COST OF EMPLOYEE TURNOVER The cost of employee turnover increases the company’s expenses. While it is difficult to fully calculate the cost of turnover, industry experts estimate it at 25% of the average employee salary . LOSS OF COMPANY KNOWLEDGE When an employee leaves, he takes with him valuable knowledge about the company, customers, current projects and past
Employee Turnover Causes and Effects In today 's highly activeprofitable work, it is becoming a challenge for jobseekers to find jobs that best fit their nature, and for companies to hire the right people who can do the job and also participate well into the firmphilosophy. Failure to overawed this issue can be resulted in high turnover of employees. Employee turnover is a part of normal business activity; whereby employees come and go as their life conditions change. Most employers realize this and, indeed, large firms typically have entire departments dedicated to the management of human resources in order to make the changeover as easy as possible for both administration and employee and to minimize the linkedengagement and exercisecharges. Employee turnover is a ratio judgement of the number of employees a company must replace in a given time period to the average number of total employees.
To evaluate this situation, employee feedback helps a lot. With employee feedbacks an organization can evaluate 50% reasons of employee turnovers. Other reason of high employee turnover can be inadequate working environment in the organization. The employees may not feel comfortable working in the work conditions they are currently made to work in. This also forces them to leave the organization in search of better environment.
Human Resource Development and related fields have explored turnover and turnover intention in association with job satisfaction, 0rganizational commitment, intellect, governmental policies, and rates of unemployment (Hatcher, 1999; Sturman et al., 2003). Job satisfaction has been found to have a negative relationship to turnover intention (Muchinsky & Morrow, 1980; Trevor, 2001). The relationship between turnover intention, dedication, and satisfaction have been supported in several additional studies (Bluedorn, 1982; Hollenbeck & Williams, 1986; Tett & Meyer,
Singapore companies provide an appropriate setting as their turnover rates are among the highest in Asia. Findings of the study suggest that the extent of controllable turnover is much greater than uncontrollable turnover and that poor management practices are the major source of employee turnover. Proper assessment and getting into the root of the problem will be helpful for employee retention. Some methods may be for current and future use and a process flow may look as such as in the flowchart above. Staff turnover will continue to be an HR issue.
Employee turnover has been a topic of interest to economists and academic experts (Mowday et al., 1982; Hom and Griffetch, 1995; Griffetch et al., 2000; Hayes et al, 2006). When employees feel dissatisfaction for their organizational culture, employees will be leaving the company or change jobs. The rate of employee turnover is increased because the organizational commitment in a manufacturing company is low. Based on previous studies, organizational commitment is the reason to increase the rate of employee turnover (Law, 2005; Trimble, 2006; Pao-Long et al, 2007; Wagner, 2007). Organizational culture can produce the loyal employees or employee commitment (Kossek and Zonia, 1993; Fields and Weaver, 2002; Myers and Dreachslin, 2007; Sippola, 2007) Therefore, need to change the organization's culture of newer technology and finds innovative ways of retaining employees.