According to a recent report from Nucleus Research, organizations can reduce average employee turnover by 30 to 60 percent in industries with high turnover such as retail, and 20 percent among organizations with salaried workers.
On average, organizations spend more than 30 percent of an employee’s salary per turnover based on the position. This can increase when considering costs required to train a replacement. Turnover also presents a domino effect that leads to costs associated with vacant positions. These costs include lost productivity, employee burnout, and workplace disruption leading to revenue loss.
Upon a review of past ROI case studies and customer interviews, analysts at Nucleus Research found that recruiting and retaining more qualified employees by leveraging talent acquisition (TA) solutions can significantly reduce turnover and gives recruiters more time to make strategic hiring decisions and develop more effective overall talent plans. According to Nucleus’ findings, this can decrease average turnover rates by 30 to 60 percent in high turnover industries such as retail, and up to 20 percent in verticals that employ more white-collar workers such as professional services.
Key drivers of reduced turnover with TA implementation:
1. Recruiting. Vendors have responded to the need to bring on high-quality candidates through capabilities for skill matching, automated resume parsing, candidate scorecards, and feedback to improve decision-making. Additionally, the continued automation of mundane sourcing and recruiting processes has allowed recruiters to spend more time improving hiring strategies and engaging and screening candidates.
2. Onboarding. Automating the onboarding process not only reduces strain on both the employer and employee, but facilitates engagement early in the employee lifecycle. Leveraging automated onboarding capabilities allows organizations to reduce the average time onboarding by more than 60 percent and yield new employee productivity gains of 3 to 11 percent.
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