Employee Turnover Calculator – Turnover Rate & Cost
Calculate employee turnover rate and estimate the true cost of employee turnover. Track retention performance and identify workforce challenges.
Employee Turnover Calculator – Turnover Rate & Cost
Calculate employee turnover rate and estimate the true cost of employee turnover. Track retention performance and identify workforce challenges.
Generated: 2/22/2026, 12:32:10 AM | AskSMB.io
Headcount at the beginning of the period
Headcount at the end of the period
Total employees who left during the period
Hiring, onboarding, training, lost productivity
Average Number of Employees
Average workforce size during the period
Employee Turnover Rate
Primary turnover metric
Employees Lost
Total employees who left
How the Employee Turnover Calculator Works
What is Employee Turnover?
Employee turnover is the rate at which employees leave an organization and must be replaced. It's calculated by dividing the number of departures by the average number of employees during a period, expressed as a percentage. For example, if you started the year with 50 employees, ended with 45, and 10 left, your average workforce was 47.5 employees and your turnover rate was 21.05%. Turnover can be voluntary (employee-initiated resignations) or involuntary (terminations, layoffs). High turnover signals retention problems, while some turnover is natural and even healthy for organizational renewal.
Why Turnover Matters for Small Businesses
Employee turnover disproportionately impacts small businesses because each employee represents a larger percentage of the workforce and often holds critical institutional knowledge. High turnover: (1) Drains financial resources through recruitment, onboarding, and lost productivity. (2) Disrupts operations and customer relationships when key employees leave. (3) Decreases team morale and can trigger additional departures. (4) Reduces competitive advantage as expertise walks out the door. (5) Consumes management time that could be spent growing the business. For small businesses, replacing an employee typically costs 50-200% of their annual salary when accounting for all direct and indirect costs. Reducing turnover by even a few percentage points can significantly improve profitability and stability.
Direct vs Indirect Turnover Costs
Understanding the full cost of turnover requires considering both direct and indirect expenses:
Direct costs include:
- Recruitment advertising and agency fees
- Interviewing and screening time
- Background checks and assessments
- Onboarding and orientation programs
- Training and development for new hires
- Administrative processing and paperwork
Indirect costs include:
- Lost productivity during vacancy period (often 3-6 months)
- Reduced productivity during new hire ramp-up (3-12 months)
- Lost institutional knowledge and client relationships
- Decreased morale and increased workload for remaining staff
- Potential quality issues and customer service disruptions
- Risk of additional turnover (cascading effect)
Combined, these costs typically range from $3,000-$10,000 for hourly workers and $10,000-$50,000+ for professional roles.
Industry Turnover Benchmarks
- Technology: 13-15% (high demand for tech talent drives mobility)
- Professional Services: 10-20% (varies by seniority and specialization)
- Healthcare: 15-25% (nursing and clinical staff see higher rates)
- Manufacturing: 20-30% (varies significantly by role and location)
- Retail: 60-70% (high part-time workforce and seasonal fluctuation)
- Hospitality: 70-80% (highest turnover due to entry-level positions and seasonal work)
- Finance/Banking: 10-15% (competitive compensation helps retention)
These are industry averages—high-performing companies in every sector maintain turnover well below these benchmarks through strong culture and retention practices.
How to Reduce Employee Turnover
- Competitive compensation: Regularly benchmark salaries against market rates and adjust proactively.
- Strong onboarding: Invest heavily in the first 90 days—most turnover happens in year one.
- Career development: Provide clear growth paths, training, and advancement opportunities.
- Effective management: Train managers on leadership, feedback, and employee development—people quit bosses, not companies.
- Work-life balance: Offer flexibility, remote options, and reasonable workloads.
- Recognition and appreciation: Regularly acknowledge contributions and celebrate wins.
- Stay interviews: Proactively ask what keeps employees engaged and address concerns before they resign.
- Exit interviews: Learn from departures to improve retention for remaining staff.
Example Scenario
Inputs:
- Employees at start: 50
- Employees at end: 45
- Employees left: 10
- Cost per employee: $6,000
Results:
- Average employees: 47.5
- Turnover rate: 21.05%
- Estimated turnover cost: $60,000
This company experienced high turnover (21.05%), losing 10 employees from an average workforce of 47.5. At a conservative $6,000 per replacement, the total cost was $60,000—representing significant financial drain and operational disruption. Reducing turnover by just 5 percentage points would save approximately $15,000 annually.
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