The ultimate guide to attrition rates

19 Feb 24 | Blog

People start jobs. People leave jobs. It’s just the natural order of things. You expect to see some turnover in your organisation, and resignations can be a welcome opportunity to bring in new talent. But what happens when too many people are resigning?

Let’s take a look at attrition: what it means, why it matters, and how we can make sense of it.

Attrition rate definition

Let’s define attrition rate. Attrition rate is a measure of the proportion of people leaving an organisation over a certain period of time. 

It’s a useful metric when it comes to comparison – against other businesses, the wider industry you’re in, or even by comparing your own organisation’s attrition rate in different years. Meaning, attrition rate helps you understand if you have a resignation problem.

How to calculate attrition rate

To do an attrition calculation, you need a few pieces of information:

  • The timeframe you’re looking at
  • The number of leavers in that timeframe
  • The total number of staff in that timeframe

You can use that to calculate your attrition rate… but then you need some more data to compare it to, like the industry benchmark or your rate in previous years. 

Our platform includes industry benchmark data, for example, and calculates your attrition rate over time so making those comparisons becomes easy. 

Here’s our attrition rate calculation: The sum of leavers in the last three months divided by the average number of people in the organisation, based on the average headcount at each monthly interval during that same three-month period.

Employee attrition FAQs

To understand why understanding attrition rates matters, check out some answers to the most frequently asked question about attrition…

Is high attrition bad?

When people leave an organisation, it’s always going to cause some level of disruption. Suddenly employees lose a colleague they may have been friendly with, they might have to take on their tasks, or spend time hiring and training a replacement. It can be bad for morale. 

So if a large proportion of your organisation leaves, it can have a negative impact on the organisation’s wellbeing, productivity and performance.

Why is low attrition good?

Low attrition can be a sign that your organisation is doing well at supporting employees, giving them meaningful work to do, and rewarding them appropriately – implied, as they’re choosing to stick around! 

But this is where comparisons are useful. ‘Good’ is relative, affected by industry trends or societal shifts (‘The Great Resignation’, anyone?) so it’s important you look deeper into the data before assuming all is well.

What is a good attrition rate in the UK?

In our benchmarking research, the UK average for turnover was 11.8% in 2022. Which you could interpret as anything higher being bad, and anything lower being a good attrition rate. But again, there’s more to factor in – especially industry-specific benchmarks (which is why we offer that data in our free platform).

What is a bad attrition rate?

There are two ways you can understand if you have a bad attrition rate:

  1. Compare your attrition rate to the industry benchmark to add some context
  2. Compare your attrition rate over time, so you know what ‘good’ looks like for you

What jobs have the highest attrition rate?

In our benchmarking data, we saw the following industries had the highest attrition rates in 2022: Utilities, Arts & Culture, Entertainment & Games, and Government & Public Administration. 

Obviously, that will differ between different job roles – and be affected by industry events – so it’s important to look closely at your own data.

How do you control attrition rate?

The opposite of attrition is retention. So that’s what comes next, after understanding attrition rate and what’s driving it. Build an employee retention plan informed by your attrition analysis, because you’ll have identified what’s driving it in the process.

Building employee retention strategies: where to start

All employee retention strategies should start with an understanding of your attrition rate (where you are), what’s driving it (how you got there), and any specific groups affected (whether a certain demographic, department, role, or otherwise).

Use a HR analytics platform like Qlearsite – for free! – and the process might look like this:

  1. Connect the HR platform you use to log everything from sick days to new starters
  2. See how our tech instantly analyses and organises the data 
  3. Compare your attrition rate over time, and to industry benchmarks
  4. See the automated insights around ‘at risk’ groups, and other useful data
  5. Investigate that further to work out what needs to change

You can do all of that for free. If you want to go further, by upgrading to the full platform, you can then collect employee feedback – just so you’re totally sure of what people want, and how to make them stay. It’s fast, easy, and incredibly insightful.

Understand employee attrition rate with Qlearsite: sign up for free

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Anne Therese Bogen, Head of HR, Thommessen

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