Even the best and most talented employees will leave a job if they’re unhappy with management, company policies, and company culture.
Employee retention has always been challenging, but as more people start their own businesses and since the pandemic, it seems that it’s become a bigger issue in the workforce.
Today, around one-third of new employees are quitting within six months of being hired.
The following 30 employee retention statistics will enlighten you to what’s going on, and may help with finding resolutions.
- One onboarding survey revealed that 31% of American workers quit their jobs within the first six months of employment.
- 76% of new employees want more and better on-the-job training.
- 72% of young employees claim to regret the new job that they just started.
- Over 47 million employees voluntarily quit their jobs in 2021.
- A 20% jump in annual employee turnover is expected for 2022.
- The 2021 Bureau of Labor Statistics report revealed the turnover rate for 2020 was 57.3%.
- The costs of employee turnover in 2021 exceeded $700 billion.
- 69% of employees can be retained if a solid onboarding program is used.
- Companies that offer remote work experience have a 25% lower employee turnover rate compared to companies that don’t.
- In 2020, the job turnover rate in Europe is, on average, lower than those in the United States.
Top Employee Retention Statistics in 2023
1. One Onboarding Survey Revealed that 31% of American Workers Quit Their Jobs Within the First Six Months of Employment.
Over 1,000 employed Americans participated in a survey that revealed that 31% of American employees quit their jobs in their first six months on the job.
This seems to be due to the lack of help throughout the onboarding process when employees are learning about the company, the job, and their coworkers.
It’s challenging to feel part of a company culture in such a short time.
Furthermore, 68% quit in their first three months. This tells us that new employees view those first three months as a trial period as much as employers use it as a probationary period.
2. 76% of New Employees Want More and Better On-The-Job Training.
Whether you believe it or not, new employees are the most zealous part of your team when you treat them right.
They are ready to learn and they want immersive and effective on-the-job training to learn how to do their jobs right.
Also, 73% want a review of company policies like time-off, sick days, benefits, and dress code policies.
Another 59% want to have a tour of the workplace and to review the administrative process.
Finally, 56% of employees surveyed said they believed it would help to have a mentor or “buddy” around for their first months of work.
3. 72% of Young Employees Claim to Regret the New Job that They Just Started.
Work culture seems to have a large impact on young workers looking for the diversity promised in the job description or video interview, only to be disappointed.
The CEO and founder of Muse, Kathryn Minshew calls this “shift shock”.
Shift shock is nothing new. It’s the feeling you get when you start a new job only to realize that the position was vastly different than what you were told.
Also, a whopping 80% of Gen-Zers said that it’s acceptable to quit a new job within 6 months if the role or work culture doesn’t meet your expectations.
(CNBC, The Muse)
4. Over 47 Million Employees Voluntarily Quit Their Jobs in 2021.
The Bureau of Labor Statistics started tracking these figures back in 2001. The 2021 figure of 47 million employees voluntarily quitting their jobs is the largest since 2001.
Quitting for career reasons maintains the top position for the reasons people quit their jobs.
Despite what people think, fewer than one out of every ten employees quit because of their pay.
(Work Institute 2022 Retention Report)
5. Employee Turnover Rates Are Skewed Across the United States.
The distribution of employee turnover is uneven to say the least. The South has the highest turnover rate, at 3.3% of workers quitting their jobs.
In the West and Midwest, the turnover rate is 2.9% of those who quit their jobs. In the Northeast, only 2.2% of workers have quit.
The South leads in all areas for hiring employees at 5%, while the West (3.9%), Midwest (4.5%), and Northeast (3.5%) have lower hiring rates.
The highest rate for unemployment was found in the District of Columbia (5.8%), closely followed by New Mexico (5.3%), and Nevada (5%).
6. A 20% Jump in Annual Employee Turnover Is Expected for 2022.
According to Gartner, the U.S. annual employee turnover rate is expected to rise almost 20% this year.
Pre-Pandemic, the average annual number of employees who quit their jobs was 31.9 million. That is expected to be 37.4 million in 2022.
A company with a 20% turnover rate before the pandemic may experience a 24% or higher turnover rate in 2022 and beyond.
One of the reasons for this rise in employee turnover is believed to be because of the lack of flexibility in hybrid work arrangements and a misalignment with workplace leaders.
7. The 2021 Bureau of Labor Statistics Report Revealed the Turnover Rate for 2020 Was 57.3%.
The annual separation (turnover) rate in 2020 came to 57.3%. Calculating these kinds of numbers is very challenging because of a variety of elements, including the industry.
That 57.3% for an annual turnover rate is high. When you consider only voluntary turnovers, it falls to 25%.
If you only count involuntary turnover, it’s 29%. Also, if you consider only the high performers, it’s only 3%.
8. In 2019, the Average Annual Turnover Rate Was 36.4%.
After reading that the average annual turnover rate for 2021 was 57.3%, 36.4% before the pandemic seems like a low turnover rate.
That’s just how serious this issue has become since the pandemic.
When looking at 2018, the turnover rate was 27%. Statistics show that the employee turnover rate has risen by an alarming 88% since 2010.
(Foy Benefits via Facebook)
9. The Costs of Employee Turnover in 2021 Exceeded $700 Billion.
Why does employee turnover cost so much money?
Statistics show that the costs incurred include separation costs, replacement costs, training costs, and the costs of lost productivity.
Exit interviews, taxes, administration paperwork, and unemployment tax costs come with employee turnover.
Also, advertising, recruiting, applicant interviews, background checks, pre-employment exams, and potential relocation costs play a role in the $700 billion.
Furthermore, training costs in materials, instruction, and equipment come at a price once you replace the person who quit.
Lost productivity can also cost the company lost business, legal actions, reputation damage, and a decrease in current employee productivity.
10. 69% of Employees Can Be Retained if A Solid Onboarding Program Is Used.
One of the things that employees say turns them off a job is the lack of good onboarding.
People do want to feel confident in what they are doing, but poor onboarding programs don’t promote that ideal.
A good onboarding program will result in 69% of employees remaining in a job for at least 3 years.
Even losing one out of every ten people due to a poor onboarding experience is something that needs to be resolved.
11. Higher Retention Rates Can Maximize Profits by Up to 4 Times.
Lower costs and increased productivity are two of the benefits that come with higher retention rates.
Also, a high turnover rate negatively impacts morale in the workplace.
Did you know that feedback and employee engagement can help improve employee retention?
In fact, 65% of employees claim that they want more engagement and feedback at work.
12. Companies that Offer Remote Work Experience Have a 25% Lower Employee Turnover Rate Compared to Companies that Don’t.
In the past few years, working from home (remote work) has become the preferred option, especially among Millennials and Gen-Z.
Many remote workers, regardless of age, are happier with the option to work at home, which results in higher retention rates.
Additionally, job satisfaction promotes employee loyalty. That in turn results in a lower retention rate.
With so many employees constantly looking for new jobs, even immediately after taking a new job, employee satisfaction is a huge deal.
13. 60% of Millennials in The Workforce Chose Flexible Work Solutions as A Priority Over Pay.
Speaking of Millennials and remote work, 60% of this generational demographic chose flexible work solutions as their main priority in a Bankrate survey.
Also, 62% of Gen-Z chose the same option.
Therefore, flexible work arrangements are the most important factor in a job, according to the Gen-Z and Millennial groups.
Even Gen-X (54%) and Baby Boomers (47%) rated flexible work options high.
14. An Owl Labs Study Reveals that Remote Workers Are Happier.
Happier employees are loyal and more apt to stay with a company longer.
During the pandemic, when employees were working remotely, they said that if given the opportunity, they would work remotely at least part-time.
Also, 84% of pandemic remote workers said they would be happier working from home.
Almost 80% said they felt less stressed and more trusted with less supervision and micromanagement.
(Owl Labs 2021)
15. In 2020, the Job Turnover Rate in Europe Is, on Average, Lower than Those in The United States.
Between 2015 and 2019, statistics revealed that European companies had lower turnover rates than companies in the United States.
In fact, Europe, Africa, and the Middle East all reported lower employee turnover rates by 4% over U.S. rates.
However, these job retention rates in Europe are expected to close the gap, getting closer to American figures.
16. More than 50% of Workers Responded that Higher Pay Would Be Their Top Reason for Looking for A New Job.
While pay isn’t always the main reason people quit jobs, it is the main reason for taking another job for higher pay.
More than 40% (44%) of employees are active job seekers, according to a Willis Towers Watson’s 2022 Global Benefits Attitude Survey.
These figures are due to the pandemic-era labor force and a trend that they call the Great Reshuffle. Additionally, this is all related to the Great Resignation concept.
17. 49% of Millennials Maintain that They Will Quit Their Jobs Within the Next Two Years.
These statistics come from a 2019 Deloitte Millennial survey.
This survey claims that Millennials are “disillusioned with traditional institutions, skeptical of business’ motives, and pessimistic about economic and social progress.”
The survey findings showed that Millennials and some Gen-Zers are pessimistic and uncertain about their careers, the world, and their lives.
It was very revealing about these two generations.
18. 46% of Human Resource Leaders Claim that Burnout Is the Main Reason for Between 20% and 50% of Annual Job Turnover Rates.
A study by Kronos Incorporated and Future Workplace revealed that 95% of HR leaders know that employee burnout is primarily responsible for poor workforce retention.
Employee burnout more commonly impacts bigger businesses over smaller ones.
Besides the 46% of HR leaders who say employee burnout is accountable for 20-50 percent of annual turnover; 10% also blame employee burnout for 50% of annual job turnover.
19. Improving Transparency in Management Can Result in 30% Higher Retention Rates.
Let’s face it, employees value and will be more loyal to companies with good ethics and work culture.
Transparency in management is one of the things that employees appreciate.
When employees are kept in the loop about what’s happening in the organization, they feel more connected and included in the company’s mission and goals.
By improving your transparency between management and workers, you can improve retention.
(Hubspot Pulse Employee Retention Report)
20. When E-Learning Is Part of Employee Onboarding, Employee Retention Is Higher.
Remote onboarding that includes e-learning, which it commonly does, the retention of employees can be as high as 69%, according to research by Glassdoor.
Also, this study showed that a solid onboarding program improves productivity by more than 70%.
Since statistics are showing the need for improvements in the workplace, it’s important to engage with a good onboarding process.
21. The Corporate Leadership Council Revealed that Engaged Employees Are 87% Less Apt to Leave Their Jobs.
Yes. Employee engagement is that important. With figures like 70% of employees being disengaged and only 31.3% being engaged, something needs to be improved.
Even that 31.3% believe their companies can do more to enhance engagement.
Companies with a positive and solid learning culture offer good employee engagement and higher retention rates by 30% to 50% over companies without a solid learning culture.
22. Job Stress Makes up 11% of The Reasons People Quit Their Jobs, According to Employee Retention Statistics.
Career changes or choices make up the biggest portion of the reasons people quit their jobs, at 22%.
Job stress due to lack of training, lack of resources, and general job traits is second at 11%.
Health and family and work-life balance tie job stress at 11% of the reasons people quit jobs.
Other factors in the decision to quit a job include total rewards, relocation, management, environment, retirement, and involuntary dismissal.
These reasons are also categorized as less preventable than other reasons for leaving a position.
23. 33% of An Employee’s Yearly Salary Is What It Costs an Employer to Replace Them.
Another cold, hard fact is that it costs an organization 33% of the employee’s yearly salary to replace them when they quit.
Essentially, the replacement cost per person amounts to $15,000 where an employee earns $45,000 per year.
Also, studies have proven that 75% of employee turnover causes are preventable.
24. Replacing a Highly-Trained Employee Can Cost from 120% to 200% of The Employee’s Annual Salary.
Why is it so important to retain highly-trained employees?
Because the costs of losing them and replacing them can range from 120% to 200% of that employee’s yearly salary.
Highly trained employees can make at least six figures. Let’s say you have a well-trained employee making $120,000 per year.
The cost to replace that employee could cost as much as $240,000.
25. An Unbelievable 60% of Organizations Say They Don’t Even Set Short-Term Goals for Their New Hires.
Setting clear goals for new employees should be part of any solid onboarding program.
Unfortunately, 60% of companies admit they don’t set clear goals for their new employees.
Setting clear goals also helps them to better acclimate and assimilate to their role while teaching them how things work around the workplace.
For instance, simply familiarizing them with parking, ID cards, how to enroll for their benefits, and offering a tour of the building can go a long way towards making them feel comfortable.
26. Due to Low Talent Retention Rates, by 2030, the U.S. Will Lose an Average of Around $430 Billion.
Retention is, and should be a top priority to American business owners. First, it costs them money, time, and productivity. Second, it’s the ethical and right thing to do.
Modern businesses are at a crossroad right now.
They have the option to either improve their employee experience, or risk higher job turnover rates and pay the high costs of that issue.
(Human Resources Today)
27. Roughly 20% of Employee Turnover Occurs Within the First 45 Days of Employment.
Those first few days and weeks of employment are when companies need to be proving themselves to new hires.
We can’t emphasize enough that a solid and effective onboarding process makes a huge difference in employee retention.
Naturally, you can’t win them all, but when you can vastly improve your employee retention, you can also save time, money, and improve productivity.
Having confident, happy, and engaged employees plays a major role in retaining good talent.
28. 77% of Employees Say a Strong Work Culture Prompts Them to Do Their Best Work.
When a survey of those who are employed brings out awareness of a strong work culture like this, companies should pay attention.
If 77% of employees claim that a strong work culture encourages them to do their best work, that’s significant.
Another 74% see a correlation between work culture and their ability to serve customers.
Plus, 63% state that the impact of a stable work culture has a direct impact on a business’ success.
(Engagement Multiplier, Eagle Hill Consulting)
29. 40% of Employees Across Companies Know Their Company’s Strategies, Mission, Goals, and Tactics.
Less than half of the American employee base knows much about their country at all.
This reflects poorly on employee engagement and communication within an organization.
Moreover, 5% of employees don’t feel that what they do makes a difference.
Another 44% are not aware of business goals or their impact within the company.
30. The Main Factors that Employees Claim to Value Include Trust, Mentorship, and Passion.
A Dive brief reported that 80% of American workers graded their company’s work-life balance, day-to-day tasks, benefits package, and morale with a B-.
Likewise, this same survey showed that the top three factors that employees value are mentorship, trust, and passion.
(HR Dive 2)
How Can Company Employee Retention Be Improved?
Other than better pay, they could implement more selective hiring processes.
Something else to consider is providing flexible work solutions and options for working remotely from home.
Moreover, supervisors and managers should be more engaged with their coworkers and let them know when they are doing good work.
This is mostly about having a positive and healthy work culture instead of the toxic work environments we have seen in the past.
What Would Be Considered an Acceptable Retention Rate?
According to the statistics, 10% is an acceptable turnover rate.
That is the employee retention rate that every company should work to achieve.
This translates into creating and maintaining a strategy that promotes a 90% retention rate.
What Is Employee Turnover?
It’s normal for all businesses to have employees that come and go, which is especially expected in specialized careers.
Essentially, employee turnover involves changes in old and new employees as they come and go.
It’s expressed in metric rate.
Our goal for this article is to not only inform our readers about statistics.
We also want to raise awareness of how big the problem has become, so employers can work on it.
So much data and so many employee retention statistics have been revealed over the past several years since the Great Resignation and the pandemic.
Employers should be more aware of the problem and how to fix it.
Improving employee relations, engagement, and overall satisfaction will reduce employee turnover rates.