4 Causes of High Turnover Every HR Professional Should Know

By Admin  |  

3 min read

For companies, one bad hire can be costly. 25% of companies have stated that this mistake can cost them a minimum of $50,000 in both direct and indirect costs. With this is mind, choosing the right hire and reducing turnover is becoming a key goal of Human Resources. However, to effectively know how, one must first understand the causes of turnover.

  1. Leadership

Leadership is a primary indicator for the longevity of an employee within a company. There’s a saying in business that goes “People don’t leave jobs, they leave managers”. In a study conducted by Approved Index, 42% of employees have left a job in the past because of poor leadership, almost a third felt their current manager wasn’t good. Reasons for these feelings stem primarily from lack of recognition and feeling overworked. To quantify the effects of bad leadership, a recent Gallup study found that around 50% of employees leave their company to get away from their bosses.

  1. Promotion & Growth

During an employee’s working life, most want to experience some degree of upward movement over time. The presence of promotional opportunities in a career has direct correlations to turnover. The better the opportunities for upward-movement, the greater the possibility of recruiting good talent and retaining them. For organizations to assure they have a workplace with sufficient opportunities, there are three questions that should be asked according to Forbes:

  1. Are there real career opportunities available?
  2. Are they visible to your talent pool?
  3. Are there support structures that facilitate internal career moves?

A study conducted by Gallup suggested that approximately 93% of career changes involved a company change. To effectively provide opportunities, managers must start the conversation on career mobility with their employees.

  1. Other Opportunities

Headhunting is a common form of recruitment. Firms will contact the best talent from competitors to attract them using higher pay, better benefits, more vacation days, etc. With the decreasing unemployment rate, talent acquisition is only getting harder.  Organizations should ensure they have employee engagement, job satisfaction and effective leadership to increase their chances of retaining their talent.

  1. The ‘When’

According to a study conducted by CEB, there are certain points in one’s life that drive career change. In moments where people compare themselves to their peers, it is particularly triggering. This includes school reunions, work anniversaries, birthdays, etc. Brian Kropp, the head of the CEB study, commented “The big realization is that it’s not just what happens at work—it’s what happens in someone’s personal life that determines when he or she decides to look for a new job.” (Kropp, 2016) Managers should seek to be aware of these risks in order to effectively mitigate them.

The leadership, promotion opportunities, other offers and employee life events are all large contributors to turnover. Managers should be mindful of these aspects to improve retention rates for their organizations. Here at Predictive Success, we provide a solution to high turnover rates. With only 2 questions and 6 minutes, our PI behavioral assessment is scientifically validated to help you pick the right hire, predict the drives and motivations of others, be a better manager and communicate more effectively. To join the 18 million+ people who have used PI or to learn about what Predictive Success can do to help your organization, contact us.









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