Businesses face high costs from employee turnover

Employee turnover is a major hidden expense for companies. Studies cited by the Center for American Progress estimate that replacing a highly‑skilled worker can cost up to 213 % of that employee’s annual salary, while the Society for Human Resource Management suggests the cost may reach five times a year’s pay. The time required to fill vacancies also adds to the burden; a Deloitte survey found it takes an average of 94 days to recruit for highly‑skilled roles and 70 days for skilled production workers. Unfilled positions increase workloads for remaining staff, reducing productivity and engagement, and can trigger a cycle of further departures.

Understanding turnover rates—calculated by dividing the number of leavers by the average workforce and multiplying by 100—helps HR leaders build business cases for retention initiatives and distinguish turnover from attrition, where positions remain unfilled by design.