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What is the turnover cost of an entry level position as a percentage of annual salary?
Answer B. 30-50%
According to recent surveys, turnover cost is 30-50% of the annual salary of an entry level position. It is 150% for middle level employees and up to 400% for specialized, high level employees. Putting those calculations into real numbers means turnover could cost between $12-15k for a $40k position.
Studies have found that only 44% of companies have processes in place to estimate the cost of turnover . . . an alarming statistic considering the amount of money it can cost each year. Therefore, it is crucial to keep turnover rates down and be mindful of the cost associated with bringing new employees on board. The best solution for this problem is to make a good hiring decision from the start!
Turnover costs include:
- Exit costs
- Recruiting
- Interviewing
- Hiring
- Orientation
- Training
- Compensation & benefits while training
- Lost productivity
- Customer dissatisfaction
- Reduced or lost business
- Administrative costs
- Lost expertise
- Temporary workers
Call Safari Solutions for ideas on how to effectively retain your top performers!
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