Staff Attrition vs Staff Turnover: What’s the Difference?

Staff Attrition vs Staff Turnover

It’s upsetting when a staff member leaves. Also, when a large number of people quit, it raises concerns about your company’s reputation. Read about “Staff Attrition vs Staff Turnover”

Why’s that? The rate at which employees depart a company indicates a more serious problem within the organization. Furthermore, it implies that change is necessary. Each time your company loses an employee, you lose both time and resources. You will have to go through the hiring and training process, which includes sourcing and shortlisting applicants, scheduling interviews, and onboarding new employees. Of course, that isn’t an affordable process!

Even with strong hiring methods, a pleasant working environment, and a positive business culture, the new generation of employees is always on the lookout for better-paying opportunities. Employees will eventually leave their jobs to work somewhere else or retire.

Attrition and turnover are two terms used in the business world to measure how healthy a company is. Nonetheless, they are frequently mistaken and even used interchangeably. While both attrition and turnover refer to the process of an employee leaving an organisation, they pertain to different types of employee churn.

These indicators can have a beneficial or negative impact on your business depending on how you view them.

Let’s look at their definitions, how they affect companies, and how they can be fixed.

What is Employee Attrition? 

Employee or Staff Attrition refers to a gradual but purposeful reduction in the number of staff members due to a natural event or process, such as retirement or resignation. Other natural events that may result in employee attrition include:

  • Elimination of a Job role
  • Personal wellness issues
  • An employee’s demise
  • An employee who is leaving the organisation to pursue further education

It’s possible that an organisation doesn’t have direct influence over employee attrition rate (like the case of retirement). In other circumstances, a company has direct control over employee attrition to cut costs.

Employee attrition can be classified into four categories:

  • Voluntary attrition – When a member of staff leaves the company voluntarily.
  • Involuntary attrition – When an employee is fired from a corporation, this is known as involuntary attrition.
  • Internal attrition – When employees transfer within a company, this is referred to as internal attrition.
  • Demographic attrition – When a specific set of employees (characterized by age, ethnicity, gender, etc.) leave the organisation, this is known as demographic attrition.

When a corporation experiences voluntary and demographic attrition, it should be alarming since it may indicate structural flaws within the business. It could also be a sign of dissatisfaction among employees. Knowing why an employee is leaving is a smart place to begin when addressing employee attrition as an employer or HR manager.

Pros and Cons Of Employee Attrition:

 Pros: 

  • Can help cut costs when a company is in financial trouble.
  • Usually regarded as a more pleasant or cordial departure from the company.

Cons:

  • Workforce decrease in size or strength
  • Remaining job responsibilities may add to the workload of remaining staff members.

How Do You Deal With Employee Attrition?

A high employee attrition rate is not good for business. The most crucial part is to figure out what causes attrition. To do this, you must:

  • Maintain an open line of communication. Employees will appreciate you more if you are honest and explain the situation. You don’t want your staff fabricating their own version of events.
  • Assure the existing employees that they are an important part of the company and should not be concerned.
  • Make sure that employees have a sense of direction. Employees who discover actual meaning and purpose in their work are more driven to do their jobs and feel fulfilled, which reduces attrition.
  • Offer encouragement and guidance to those who are being laid off.

What does employee turnover mean?

When a staff member leaves a company and the company intends to fill the vacancy, it is referred to as staff turnover. It can be voluntary or involuntary, depending on the situation:

  • Voluntary employee turnover is defined as when an employee departs voluntarily for a variety of reasons, including low compensation, a lack of promotion, a toxic work environment, or a better job offer. 
  • Involuntary employee turnover, on the other hand, is a situation in which an employee is fired for poor performance or behavioural concerns. The choice is made with the intention of replacing them.

The Pros and Cons of Employee Turnover

Pros: 

  • It will be beneficial to the organisation if an underperforming employee chooses to quit rather than be fired.
  • It allows a business to hire a better skilled and experienced individual.

Cons:

  • Replacing employees is a very expensive operation.
  • It becomes challenging to establish and maintain a consistent workplace culture.
  • Rather than focusing on growth, your company will devote all of its time, energy, and assets to employee training and onboarding.
  • Reduces the number and strength of your team, which influences the performance and productivity of your business.
  • A high employee turnover rate degrades your company’s image, making it more difficult to recruit the best talent.
  • Employee burnout could develop if the former employee’s responsibilities are shifted to the current staff.

How to Manage Employee Turnover

Whatever you do, you must keep the employee turnover rate to a minimum. Here are some employee retention tactics that can help you achieve that goal:

  • Begin with hiring the best candidates for the job, which can be easy with a recruitment management software.
  • Provide attractive benefit packages to employees, such as medical insurance, vacation time, and career advancement opportunities.
  • Make performance evaluations and reviews a company-wide routine. This allows you to see if your employees are on track. You can accomplish this by employing a variety of tools and programmes. 
  • Don’t forget to appreciate employees for their hard work. You can do this by publicly celebrating their accomplishments or by rewarding them.
  • Communicate the company’s aims, vision, and mission clearly and concisely. Maintain open lines of communication and ensure that each employee understands his or her tasks and duties so that they are aware of what is expected of them.

As an employer or HR manager, you must accept that no matter how hard you try or how effective your retention techniques are, some employees will leave. The most important thing to accomplish is to analyze trends over time and make the required changes in your business. At the end of the day, the last thing HR and management want is a high attrition and turnover rate among their workforce. Hope you love reading about “Staff Attrition vs Staff Turnover”

Author Bio

Ansh Aggarwal

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Ansh Aggarwal has 6+ years of experience in the B2B Marketing space in India and International markets. Currently associated with Zimyo, Ansh is taking care of the entire gamut of marketing activities for the on-boarding of Enterprise clients. He communicates directly/indirectly with Industry leader CXOs, CHROs, IT Heads to understand their challenges and come up with solutions that are enabling them to transform their company into an employee-centric organization.

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By Michael Caine

Michael Caine is the Owner of Amir Articles and also the founder of ANO Digital (Most Powerful Online Content Creator Company), from the USA, studied MBA in 2012, love to play games and write content in different categories.

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