Interesting question: How much would you pay to decrease employee turnover?
Anshul Raghav
7 replies
The expenses associated with retaining and replacing employees often surpass the costs of initial hiring. If presented with an opportunity to reduce your employee turnover rate, what value would you place on retaining each employee?
Replies
Janak Patel@janak_patel56
It depends on how much his works contributes to the team equal to pay increase
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@janak_patel56 I think that's a pretty good way to figure it out.
@janak_patel56 agree. Let's define this scenario more clearly. Imagine it's the beginning of the financial year, and your organization has a workforce of 1k employees, with an average salary of $10k/month. You aim to improve employee retention and enhance the organization's culture, regardless of individual performance. How much budget are you willing to allocate or invest for this purpose?
@anshul_raghav I guess hiring + 3 months' training cost is the overhead of hiring a new employee rather than retaining the existing one. If you're aiming for 20% reduction in attrition then 20%-25% of that hiring new employee cost you can spend on improving the culture and see the result. Is it too simplistic?
Interesting! I'm curious to know how you do yours.
@atticusli The question is how much am I willing to invest in it? I will try to determine this by using a Talent Value Index, which calculates the average cost my organization incurs for its most talented people and compares it to the average salary in our organization. This calculation will help me identify the amount I can invest to reduce turnover.
Hey there Product Hunters! 🚀 As someone deeply entrenched in the startup and tech world, I know firsthand the challenges of employee turnover. The costs add up quickly!
When it comes to placing a value on retaining each employee, it's not just about the numbers on a spreadsheet. It's about the knowledge, experience, and synergy they bring to the team.
For me, the value of retaining each employee is immeasurable. After all, a happy and stable team is priceless in the ever-evolving tech landscape. So, to decrease employee turnover? I'd say it's a no-brainer investment in the long-term success of any venture. 💡