Employee Turnover Introduction: What Are the Causes and Impacts?

Employee Turnover Introduction: What Are the Causes and Impacts?

It’s no secret that employee turnover often occurs in any company and in any industry. This is a natural thing considering that turnover or employee turnover in companies is indeed common because there will always be regeneration in it.

However, in other cases, if employee turnover occurs in an unreasonable or very high number. This is a sign that the company is not doing well. There will be many losses that can arise later due to high turnover and of course, this will greatly affect the productivity of the team working in it.

That is why companies must know the right strategy to manage it well. However, before planning various strategies, companies must of course carefully understand the ins and outs of employee turnover. Starting from the causes to the losses that might appear afterward. The reason, in this article Algobash, will invite you to have an in-depth discussion about this.

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What is employee turnover?

In simple terms, employee turnover can be interpreted as a process of changing employees in a company. There are some employees who decide to leave and then a new employee appears who will take their place. There are two types of employee turnover that usually occur, namely voluntary or not.

Voluntary turnover

Employees decide to leave the company based on their will. There are many reasons that can influence this to happen, one of which is a bad work environment, the benefits provided are not competitive, there is no career path and many more.

This mismatch makes employees decide to leave and look for new opportunities elsewhere. The cause of this turnover, of course, can still be avoided by evaluating and correcting it.

Involuntary turnover

The company enforces the termination of employees. This means that this is not done by the employee’s own will but through a process of dismissal or dismissal carried out by the company. The occurrence of this turnover is motivated by many reasons, but the fundamental reason is to maintain the survival of the company.

Then in terms of function, employee turnover that occurs in the company is also divided into two forms, namely functional and dysfunctional.

Functional turnover is very profitable for the company because it is the dismissal of employees who have poor and unreliable performance. While dysfunctional turnover is the opposite, employees who stop working are still in great need of their roles and have good performance but decide to leave the company.

Causes of employee turnover

There will be many answers that can answer the question of the reasons for the occurrence of an employee turnover in the company. All of these reasons are very important to know to be used as consideration and evaluation by the company if this happens within abnormal limits.

Broadly speaking, the reasons for employee turnover are divided into three factors, namely individual, organizational, and geographical. You can analyze the reasons behind the occurrence of turnover through these three factors.

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Individual factors:

  • Employees have a low level of job satisfaction with the company.
  • Employees feel the workload is too heavy.
  • Employees feel unsuitable for the work environment.
  • Employees want other opportunities with higher pay.
  • Employees have been working for a long time and want opportunities elsewhere.
  • Employees have a young age and decide to retire.

Organizational factors:

  • The company has a working system that is too repressive.
  • The company has a non-transparent salary system.
  • Employees do not have a program that can encourage individual or team development.
  • The company does not pay attention to and meet the needs of employees.
  • The company does not value employee performance.

Geographical factors:

The distance between the workplace and the employee’s place of residence is very far, so the employee decides to stop working and move to another place that is closer to his place of residence. This is usually the reason for some employees who have worked in a company for a long time.

The bad impact of employee turnover

As previously mentioned, employee turnover is like a double-edged sword. On the one hand, it will be beneficial but on the other hand, it can be detrimental.

Employee turnover rates that are too high can cause a lot of losses that can affect the ecosystem within the company, one of which is a decrease in work productivity and also the moral impact on employees who survive. In addition to these two things, turnover will also eat away at the company’s funds, this of course makes the company lose financially.

The costs incurred due to employee turnover are very high because they have to re-do the re-recruitment process starting from advertising job vacancies on various job portals, onboarding, and so on.

That’s a complete discussion of employee turnover starting from understanding the causes, to what losses the company will feel if this happens. As an HR person, of course, you don’t want employee turnover to occur in very high numbers, right? Try to follow every step mentioned above to avoid it.

If you are interested in other information, don’t forget to visit our blog Algobash Insight to find other interesting articles about recruitment and technology.

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