Employee Turnover Rate Calculator Formula
Understand the math behind the employee turnover rate calculator. Each variable explained with a worked example.
Formulas Used
Turnover Rate
turnover_rate = (headcount_start + headcount_end) > 0 ? (separations / ((headcount_start + headcount_end) / 2)) * 100 : 0Average Headcount
avg_headcount = (headcount_start + headcount_end) / 2Retention Rate
retention_rate = (headcount_start + headcount_end) > 0 ? (1 - separations / ((headcount_start + headcount_end) / 2)) * 100 : 0Variables
| Variable | Description | Default |
|---|---|---|
separations | Number of Separations | 12 |
headcount_start | Headcount at Start of Period | 200 |
headcount_end | Headcount at End of Period | 210 |
How It Works
How to Calculate Employee Turnover Rate
Formula
Turnover Rate = (Separations / Average Headcount) x 100 Average Headcount = (Beginning + Ending Headcount) / 2
Turnover captures both voluntary departures (resignations) and involuntary ones (terminations, layoffs). High turnover drains institutional knowledge, disrupts teams, and increases recruiting and training costs. Tracking turnover by department, tenure, and role uncovers patterns that targeted retention strategies can address.
Worked Example
A company starts the year with 200 employees, ends with 210, and 12 employees left during the year.
- 01Average Headcount = (200 + 210) / 2 = 205
- 02Turnover Rate = (12 / 205) x 100 = 5.85%
- 03Retention Rate = (1 - 12/205) x 100 = 94.15%
Frequently Asked Questions
What is a normal employee turnover rate?
The US average is roughly 12-15% annually. Tech companies may see 13-15%. Retail and hospitality can exceed 60%. Low turnover (under 10%) suggests strong culture and competitive compensation.
Should I track voluntary and involuntary turnover separately?
Yes. Voluntary turnover reveals employee satisfaction and competitiveness of your offer. Involuntary turnover reflects hiring quality and performance management. The levers to improve each are different.
Learn More
Guide
How to Calculate Employee Turnover Rate
Learn how to calculate monthly and annual employee turnover rate, understand voluntary vs. involuntary turnover, and benchmark your numbers against industry averages.
Ready to run the numbers?
Open Employee Turnover Rate Calculator