Some employee turnover is both normal and inevitable. Even if you’re taking all the right steps to improve employee engagement and retention, there are still people who are going to leave or get fired for any number of reasons. Before the pandemic, companies could expect to see around an 18% turnover rate every year. By 2021, as the pandemic began to recede, voluntary turnover across industries was at 25%, and some experts predicted that more than half of employees in the United States (U.S.) were looking for a new job.
No matter the circumstances, employee turnover has very real business consequences, especially in terms of cost and added workload. It can cost anywhere from one-half to two times an employee’s compensation to replace them. And the remaining employees on the team have to pick up the slack for a period of time, which can exacerbate burnout and other problems.
The impact on HR and people managers is also significant. In addition to their other daily responsibilities, they have to spend time offboarding departing employees by coordinating final pay, ending benefits, and updating the organizational chart, followed by the long process of recruiting, hiring, and onboarding a new employee to fill the vacated position.
One way to deal with turnover is to get out ahead of it so you can plan better and mitigate its effects. For example, there are some departments and professions that routinely experience higher turnover than others. Knowing what those are in your own organization and having the right tools in place can help you manage turnover more effectively — and save time and money in the process.
Here’s a look at high turnover departments as well as how technology makes it easier to respond to and manage staff changes.
High employee turnover departments
Whether it’s because of compensation concerns, career advancement goals, or recruitment by other companies, these are the departments and professions that commonly experience high turnover:
Sales. Sales representatives are under a lot of pressure to perform, and they depend largely on compensation, commissions, and/or bonuses for motivation. There’s a delicate balance between being challenged and incentivized appropriately but not being asked to do the impossible, and if any of these fall out of balance, sales reps are likely to leave. Problems with leadership or the company’s inability to keep up with market demands can also contribute to sales turnover. And since sales reps with a strong book of business are often attractive to other companies, it’s easy for them to be enticed away. As a result, the average tenure of a salesperson is less than two years.
Customer service. Many customer service roles are entry-level, which means eventually the employees in those roles either get promoted into a supervisor or management role or simply want to advance their career in some other way. And because customer service and call center jobs are plentiful and in high demand, it’s also common for customer service reps to take jobs with other companies. This may be why the turnover rate at call centers is as high as 45%.
Finance. Finance employees are often on career trajectories that lead them to go after mid- to senior-level roles, whether with their current or another organization or to leave entirely and start their own firms. And since no company, regardless of industry, can operate without a finance department, employees who want to change industries out of interest or necessity have a lot of job options to choose from. Millennials, in particular, have big goals, with 72% saying they want to work in the finance sector overseas during their career.
Human resources. Similar to customer service reps, HR professionals are in high demand, so finding another role at another company, especially one where they can advance their career, is common among employees. HR staff also experience serious burnout and exhaustion on the job — which leads to turnover. A recent survey found that 42% of HR teams are struggling under the weight of too many projects and responsibilities.
If you’ve experienced high rates of employee turnover in any of these departments, you likely understand how frustrating it can be. But there are solutions that can help you stay on top of staff changes and manage your workforce with more predictability and confidence.
Turn it over to technology
Technology solutions, such as a human capital management (HCM) system built on a position-based architecture, provide wide visibility into your workforce so you’re aware of what’s happening at all times. When turnover occurs in any department, you can immediately see the particular position that needs to be filled, along with vital data about that position that’s decoupled from the employee — meaning it doesn’t disappear when the employee leaves. This kind of persistent position information is also date stamped so you can run reports that compare your current staffing levels to your yearly workforce plans.
Forecasting and planning are also easier with unified and integrated finance and staffing data, so you can better understand your organization’s workforce trends, make headcount projections, and plan budgets accurately. And since the HCM system provides a centralized, single source of truth with standardized, shareable data, all stakeholders — HR, people managers, executives, and others — can use it to align their respective strategies around workforce needs and goals.
Visibility and data are invaluable to understanding the full depth and breadth of your workforce so you can respond quickly and intelligently to change. You spend less time hunting down information from different departments and struggling to form an accurate picture of your workforce, and you waste less money on redundant or unnecessary hires.
Ready to learn more about how an HCM system can help you better manage employee turnover?
We are here to support you with efficient, accurate, and cost-effective workforce management solutions that put you in control and ahead of the curve when it comes to employee turnover and workforce change. To learn more about SyncHR, click here.
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