What is Attrition Rate?
Attrition Rate, also known as employee turnover rate, is the percentage of employees who leave an organization during a specific time period. It reflects the organization’s ability to retain employees and is a critical metric for analyzing workforce stability and employee satisfaction.
Types of Attrition:
- Voluntary Attrition: Employees leave the organization by choice (e.g., resignations, career change).
- Involuntary Attrition: Employees leave due to organizational decisions (e.g., layoffs, terminations).
- Internal Attrition: Employees move to other departments or roles within the same organization.
- Demographic Attrition: Employees from specific demographics (e.g., age, gender, seniority) leave at a higher rate.
Causes of High Attrition:
- Poor employee engagement or satisfaction.
- Lack of career growth opportunities.
- Ineffective leadership or management.
- Poor work-life balance.
- Inadequate compensation or benefits.
- Toxic workplace culture.
Attrition Rate, also known as employee turnover rate, is the percentage of employees who leave an organization during a specific time period. It reflects the organization’s ability to retain employees and is a critical metric for analyzing workforce stability and employee satisfaction.
Formula to Calculate Attrition Rate:
Attrition Rate (%)=(Number of Employees Who Left During the Period / Average Number of Employees During the Period)×100
How HR teams use this term
HR teams usually use Attrition Rate when they write policies, explain employee communication, review payroll or leave records, or keep employee data clean in an HRMS.