Average Turnover Rate
The U.S. has a 47% annual turnover rate. Learn how turnover rates affect your business and the best ways to lower them.
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The average American stays at the same job for over 4 years.
Finding someone to replace a good employee can be a straining process. And it can get quite costly too. Especially for management and c-suite positions.
Employee turnover can cost companies millions. Here is how it affects different U.S. industries.
Turnover Rates in the United States
What is the average turnover rate?
The annual average turnover rate in the U.S. is 47.2%, according to the Bureau of Labor Statistics. That rate has increased steadily since 2014 when it was just 40.3%.
Which U.S. region has the highest turnover rate?
The Southern region has a 52.2% average annual turnover rate.
What about the lowest?
The Northeast region has the lowest rate with an annual average turnover rate of 38.7%.
Which industries have the highest turnover rates?
| Industry | Turnover Rate |
|---|---|
| Accommodation and food services | 86.3% |
| Arts, entertainment, and recreation | 76.3% |
| Retail trade | 64.6% |
| Professional and business services | 64.2% |
| Construction | 56.9% |
| Transportation, warehousing, and utilities | 49.0% |
| Nondurable goods manufacturing | 47.3% |
Which industries have the lowest turnover rates?
- State and local education: 16.0%
- Federal government: 18.8%
- State and local positions: 20.2%
- Private educational services: 25.5%
- Finance and insurance: 26.3%
Which major companies have the highest turnover rate?
According to a study performed by PayScale, companies with the highest turnover rates include:
- Mass Mutual: 0.8 years
- Amazon: 1 year
- Aflac: 1 year
- Google: 1.1 years
What is the average turnover rate for call centers?
Call centers have a high turnover rate compared to the national average. Many companies don't readily publish their turnover rate. But the industry average is estimated to be 30% to 45%.
- Fair compensation
- Good management
- Developing a company culture
- Ensuring room for growth
Understanding Turnover Rates
What is a good turnover rate?
A turnover rate of 10% or less is considered ideal.
How much does employee turnover cost a company?
On average, employee turnover can cost a company 33% of the employee's salary. This covers direct costs such as expenses for hiring/recruiting and advertising. And indirect costs like reduced revenue due to decreased productivity.
What's the average turnover cost of an executive?
Turnover of executives or positions that require extensive education can cost employers 213% of their annual salary.
There were 11.4 million job openings in the United States in April 2022, an increase of 2.1 million positions from the previous year. The BLS defines a job opening as a position a company is actively trying to fill.
Tenure Rates in the United States
What is the average national tenure?
The average tenure of an employee in the U.S. is 4.1 years.
How long does the average man stay at one job?
Men stay in the same position for an average of 4.3 years. Around 29% of them stay at the same job for 10 years or more.
What about the average woman?
The average woman stays in the same position for 3.9 years. Only about 27% of women stay at the same job for 10+ years.
Does the average tenure rate change with age?
Older individuals tend to stay at the same job for longer periods than younger employees.
Employee tenure rates by age are:
| Age Range | Average Tenure Rate |
|---|---|
| Ages 20-24 | 1.3 years |
| Ages 25-34 | 2.8 years |
| Ages 35-44 | 4.9 years |
| Ages 45-54 | 7.5 years |
| Ages 55-64 | 9.9 years |
| Ages 65+ | 10.3 years |
Ways to Lower Turnover Rates
What causes a high turnover rate?
Today's high turnover rates are often the result of:
- Lack of company morale
- Lack of opportunities for growth
- Lack of work/life balance
- Poor management
Why is a low turnover rate good for a company?
Constant employee turnover can cause low productivity and poor employee morale. A low turnover rate, on the other hand, can help improve productivity.
It can also save a company money, as replacing employees can cost 33% of the employee's salary.
What are the best ways to prevent a high turnover rate?
Preventing a high turnover rate is primarily based on the work environment you provide to employees. The top companies with low turnover rates offer:
- Employee recognition
- Opportunity for advancement
- Clear communication
- Work/life balance
Bottom Line
The annual average turnover rate continues to rise. And it can be expensive for employers.
High turnover rates can look like a red flag to potential applicants. Many see this as a cause for concern over company culture. High turnover rates can also result in budget damage. An employee leaving can cost from 30% to over 200% of their salary.
Reducing your company's turnover rate can help boost employee morale, productivity, and your company's bottom line.
Sources
Write to Kim P at feedback@creditdonkey.com. Follow us on Twitter and Facebook for our latest posts.
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