Worksheet: Calculating Turnover Costs
| Turnover Ratio: The number of employees who left, divided by the average number employed per year. | |
| Separation Costs | |
| Interviewer’s time (hours spent x hourly rate*) | $ |
| Terminated employee’s time (while on payroll: hours spent x hourly rate) | $ |
| HR administrative functions (terminated paperwork: hours spent x hourly rate) | $ |
| Separation pay | $ |
| Total separation costs | $ |
| *Include benefits in the hourly rate. | $ |
| Replacement Costs | |
| Advertising | $ |
| Internal communications (development time x hourly rate) | $ |
| Interview time (hours spent x hourly rate for interviewer) | $ |
| Administrative functions (typing, copying: hours spent x hourly rate) | $ |
| Applicant testing (such as validated aptitude tests) | $ |
| Applicant travel expenses | $ |
| Applicant relocation expenses | $ |
| Total replacement costs | $ |
| Training Cost | |
| Employee workbooks (printing + time for development x hourly rate) | $ |
| Orientation(s) (new employee time + staff time x hourly rates) | $ |
| On-the-job training (employees’ time x hourly rates) | $ |
| Total training costs | $ |
| Separation + Replacement + Training = | $ |
| Per Employee Cost | |
| (total costs ÷ number left in the company) = | $ |
| Source: (The Career Press, 2007) | |