Your Company May Be Sacrificing Millions of Dollars

By August 29, 2019 Workforce Resource
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Are you having issues retaining your employees and engaging them long-term? Well, you’re not alone.

Employee retention is one of the most challenging problems business owners face.

According to the Society for Human Resource Management’s report, the direct cost of replacing an employee range between 50 to 60 percent of the employee’s annual salary, but the total associated cost of the turnover is between 90 to 200 percent of the employee’s annual salary.

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Join the discussion 2 Comments

  • Agreed. Employee retention is costing companies more than their annual salary.
    But, why are employees leaving the company? I am not sure about the case in the US but here in India, an employee who has proved himself in the company is offered a meager 10% hike annually whereas when you quit and join a new company, you can expect a 40% jump in the pay, which is lucrative.

    So, a regular jump for 2 to 3 years would fetch you nearly double the salary in 6 years. Toiling the same company for so long wouldn’t do that good I guess.

  • Brian Tinsman says:

    Great point, Dr. Gunasekaran! This is definitely not intended to point blame at the employee–companies have to make it worth it for a star employee to stay. It’s all part of the big picture of employment. This article was intended to point out the hidden consequences of not trying harder to keep an employee. The cost of retention is almost always cheaper than replacement.

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