Staff turnover is expensive. Costs associated with recruitment and turnover include:

• Advertising costs;
• Lost time spent on interviews, clerical and administrative tasks;
• Costs associated with training the new employee;
• Termination pay;
• Loss of specialist knowledge;
• Even loss of customers; and
• An organization that suffers high staff turnover is likely to experience low staff morale and reduced productivity.

To calculate the cost of turnover in your own organization, see EOWA’s tool, Cost Turnover Calculator.

“Generally, organizational turnover costs per person are between 90 and 2000 percent of a person’s annual salary.”

• In Australia, a 2000 Study including NRMA estimated the cost of replacing a manager at $48,000, and other staff members at $12,000. The same study suggested a figure of $60,000 on senior management replacement at Westpac, and $40,000 for a regular employee. Generally, organizational turnover costs per person are between 90 and 2000 percent of a person’s annual salary . (Reported in Diversity No 6, 2002, "The Diversity Dividend")
  
  
• At Deloittes & Touche, one of America’s largest client services firms, the CEO realized that too many talented women were walking out the door – NOT to raise families (as had previously been assumed), but because they had weighed up their options in Deloitte’s male-dominated culture and found it wanting. Through the CEO’s personal drive, women partners went from 5 to 14%, and saved the company over $250 million in hiring and training costs.