The Best Ways To Calculate Your Employee's Turnover Rate

Your guide to calculating employee turnover with emphasis on the frequency of calculation, benefits, and importance.

March 6, 2023
Press the button to generate random icebreaker questions.
There are 300 more icebreaker questions at the bottom of the article
How would you describe your job to a five year old?
What season would you be?
What is a weird food you have tried? Would you eat it again?
What is your favorite holiday tradition?
Would you go in the mother-ship with aliens if they landed on Earth tomorrow?
What is your favorite season?
Do prefer working from home or the office?
What is your earliest memory of this job?
What is the best thing you have bought so far this year?
What is the earliest book you remember?
If you had to move to another country, which one would you choose?
You are the best criminal mastermind in the world. What crime would you commit if you knew you would get away with it?
What is your favorite movie genre to watch?
What was the last thing you ate?
What person from history would you add to Mount Rushmore?
What is a weird fact you know?
What is your favorite part of working from home?
Were the Spice Girls a good team?
Imagine you can instantly learn any language. Which would you choose?
If you could live in any state, which state would you pick?
Which fictional team is the best team of all time?
What did you want to be when you grew up?
What do you usually eat for a quick lunch?
What simple food will you never eat?
Show us the weirdest thing you have in the room with you right now.
Would you rather stay at a hotel or an AirBNB?
What is your favorite movie genre to watch?
Are you more productive in the morning or at night?
Who is someone in your community that makes a difference?
Who was your most unique pet?
Choose one famous person from history you want on your team during a zombie apocalypse.
What is a good way to give back to the community?
Which song could you listen to over and over again?
Is Hugh Grant funny?
What is your favorite thing to eat for breakfast?
Would you want to have an imaginary friend today? Did you have one as a child?
What actor or actress would you want to play you in the movie about your life?
What is the best super power?
What is your New Years resolution?
You can only eat one food again for the rest of your life. What is it?
What is the best work holiday?
What is the first gift you remember receiving?
Would you rather join Metallica or Backstreet Boys?
What is the best example of a community you have seen?
What is an easy way to do something nice for someone?
Show us your phone background and tell the story behind why you picked this image.
What was your first job?
Pick any band to play at your funeral.
If you could have an unlimited supply of one thing for the rest of your life, what would you pick?
Which superpower would you give to your arch enemy?
What is the most obscure superpower you would want?
What emoji best describes how you are feeling right now?
If you could live in any country, which country would you pick?
Would you rather live in a city or a town?
What is your favorite holiday?
What is something you accomplished as part of a team?
What is your standard office lunch?
What is your most used phone app?
What is your favorite season?
Have you ever won something as a team?
Imagine you are a professional baseball player. What is your introduction song?
Beach holiday or ski trip?
Have you ever been to a funny comedy show?
Would you rather live at the North Pole or the South Pole?
What is your favorite song to sing?
If you could live in any state, which state would you pick?
Imagine you could teleport anywhere. Where would you go right now?
What is the most unusual job you have heard of?
What was the last thing you ate?
You can visit any fictional time or place. Which would you pick?
What do your family and friends think you do all day?
What movie do you wish you could watch again for the first time?
Show us your most-used emoji.
What was the most unique style or fashion trend you ever embraced?
What movie defined your generation?
You are stranded on a remote desert island. Are you alone or with your worst enemy?
What is your favorite knock-knock joke?
Have you ever told someone Santa is not real?
Do you know how to speak more than one language?
On a scale of 1 – 10, how much of a team player are you?
What is your #1 recommendation in this city?
What is your favorite holiday?
What bucket list item do you most want to check off in the next six months?
What is your favorite mythical creature?
What was the first way you made money?
If you could be great at any Olympic sport, which would it be?
Which song could you listen to over and over again?
When did you start liking/hating mushrooms?
Where is your favorite vacation spot?
Do you take your PTO all at one time, or another way?
Which show do you remember most from your childhood?
Which beverage goes best with pizza?
Would you want to have a personal assistant follow you around everywhere and do what you asked of them?
Have you ever met your idol?
What did you want to be when you grew up?
Would you rather live 100 years in the past or 100 years in the future?
What is your hobby?
When you are alone in the car, what volume is the music at?
Imagine you no longer have to work. How would you spend a Tuesday?
What is your favorite type of sandwich?

Employee turnover rate is typically a reliable indicator of your company's success. It measures the average number of employees exiting a company within a period, whether monthly, quarterly, or annually.

Turnover rates provide insight into a company's brand, culture, and recruitment exercises. And keeping track of your turnover rate helps you avoid major pitfalls in business.  

Every business undergoes turnover at one point or another, but a high turnover rate is cost-intensive due to replacing existing employees. So, it's essential that you know how to calculate and analyze your employee turnover rate and interpret it for the continued survival of your business. 

This article will show you how to calculate your turnover rate, how often you should do it, and how these exercises benefit your company’s bottom line. 

Let's get right to it!

How Do You Calculate Employee Turnover?

Calculating your employee turnover rate requires three variables. They include;

  • The number of employees at the start of the period under review
  • The number of employees at the end of the period under review
  • The total number of employees who left during the period

The formula for turnover calculation is - (Number of exiting employees/Average number of employees) × 100.

Let’s break it down. 

Suppose an HR company had 250 employees at the beginning of January 2022, and 40 employees exited the company the same year. Then, you recruited 20 new employees during the course of the year until January 1, 2023, and the total number of employees in the company was now 230. 

You can calculate the employee turnover rate for this company for the year 2022 using the following steps:

Step 1

The first step is to specify the period under review. In our example above, the timeline spans from January 1, 2022, to January 1, 2023. 

This step is crucial as it helps you know which values to assign to the variables in the employee turnover calculation formula. Only the number of employees who left the company during that time should be used in the calculation.

Step 2

The next thing is to work out the average number of employees in the company for the period.

For a given time, it's obtained by adding up the number of employees at the start and end, then dividing the sum by two.

In our example, the number of employees at the beginning of 2022 was 250. And the number of employees at the beginning of 2023 was 230. Hence; (250+230)/2 = 240

When working out this value, be careful not to include contractual employees. Their inclusion makes the result less accurate, as their exits from your company are primarily due to end-of-contract tenure and hence can't qualify as a turnover.

Do well to include direct labor and part-time and full-time employees on your payroll in estimating the total number of employees at the start and end of the period.

Step 3

Next is to estimate the total number of departures in that time. In this example, the total number of departures is 20.

An accurate turnover calculation incorporates every single employee exit. For accuracy, you should include voluntary and involuntary employee departures within the period.

This, however, does not include employees who were absent temporarily, those on sabbaticals, for health reasons, or personal issues. The reason is that they're still part of your payroll. 

Step 4

Since we know the values of the different variables, we can now apply the employee turnover calculation formula to this example. The employee turnover rate is calculated as follows:

Number of exiting employees within the period = 20

The average number of employees within the period = 240

Employee turnover rate = (20/240) × 100 = 8.33%

Step 5

It's not enough to just calculate the employee turnover rate. Much more importantly, it's key to know how to interpret it.

One good way of doing so is by comparing the value you get with industry standards. This helps you assess the effectiveness of your employee retention program. In addition, it provides a good measure of how well you're handling the competition.

According to LinkedIn, the HR industry had an average turnover rate of 14.6% in 2022. In our example, the turnover rate is 8.3%.

Employee turnover calculation can be daunting, especially when keeping track of the number of hires, departures, and employees both active and temporarily absent. However, Assembly is an excellent tool that helps you monitor these variables for a seamless calculation. 

Book a demo today, for free.

What's The Best Way To Calculate Turnover?

The best way to calculate employee turnover is to do it quarterly or yearly.

This frequency provides a more holistic picture of the company's turnover rate. Deductions from employee turnover calculations offer valuable insights into the company's performance, retention efforts, brand, and culture.

An extended period allows the variables influencing employee turnover rate to become large enough to produce more realistic and actionable sequences.

How Do You Calculate Employee Turnover In Excel?

Spreadsheet packages such as Excel make employee turnover calculation more seamless. They help in monitoring monthly hires and exits through a more precise representation. 

Using Excel to calculate turnover involves the following steps:

Step 1

Assign variables to six columns in the spreadsheet. The variables include;

●       Month.

●       Starting balance.

●       Number of new employees.

●       Number of departing employees.

●       Ending balance.

●       Turnover.

Under the column assigned to the year, include the months of the year in chronological order.

Step 2

Input values for the following variables;

●       Starting balance.

●       Number of new employees.

●       Number of departed employees.

Ensure that the values correspond to the month of the year to which they apply.

Step 3

After manually imputing the values, you apply the employee turnover calculation formula.

The ending balance is obtained by summing up the starting balance (which is the number of employees at the start of the month) and the number of new employees during the month.

Then, you subtract the total sum from the number of departed employees. Resignations, retirement, layoffs, and people who were let go make up the employees who have left.

E.g., For February;

Column A1 represents the month of February.

Column B1 represents the starting balance for February.

Column C1 represents the number of new employees for February.

Column D1 represents the number of departed employees for February.

Then the closing balance, column E1 is calculated as (B1+C1) - D1, and the employee turnover calculation is D1/ {(B1+E1)}.

Once you apply the formula for a particular month, it can be extended to other months by simply copying and pasting the cell with the formula to the rest of the cells under the turnover column. 

This also applies to the closing balance. And the formula is spontaneously modified for each new cell to reflect the corresponding values. 

To express the results obtained as a percentage, it requires that you highlight the turnover column and select the percentage icon. Doing so will convert the results obtained to percentages.

How Does HR Measure Turnover?

HR departments measure turnover using the following metrics:

  • Overall retention rate
  • Retention rate per department 
  • New hire retention rate
  • The average length of employment
  • Voluntary turnover rate
  • Involuntary turnover rate
  • Employee turnover rate

Overall Retention Rate

This is the average number of employees that remain in a company over a given period. And just like the overall turnover rate, it can also be expressed as a percentage.

You can deduce the overall retention rate from the employee turnover calculation. The calculation is Overall retention rate = 100 - Overall turnover rate.

This metric provides reliable insights into employee satisfaction, the company culture, and work-life balance. And a high retention rate signifies increased productivity and improved employee engagement.

Retention Rate Per Department Or Position

This is a subset of the overall retention rate. Companies can obtain the retention rate for each department or position by calculating the turnover rate per department or position and subtracting it from 100.

This statistic lets you know which department or position requires more attention regarding the budget allocation and onboarding optimization.

New Hire Retention Rate

For better analysis of a company's recruitment and onboarding practices, this metric helps reflect newly hired employees who remain with the company for a given period.

The new hire retention rate calculation is as follows: (Number of new hires who stayed / Total new hires) × 100

Average Length Of Employment

This metric provides additional insights into a company's turnover and retention efforts. It's an estimate of the average employment duration in an organization.

The figures allow companies to evaluate an organization's performance compared to other industry competitors. The calculation is as follows: Average length of employment = (Total years of service across the organization) ÷ (Total number of employees).

Voluntary Turnover Rate

This represents employees leaving a company of their free will. This can be due to several reasons, including the pursuit of new challenges and new job offers.

The voluntary turnover rate is: (Number of employees who quit / Average number of employees) × 100.

Voluntary turnover rates help companies to understand the overall turnover rate better. An increase in the number of employees quitting a company due to finding better working conditions might require a review of the company's recruitment strategies; either the company is recruiting unqualified or overqualified applicants.

An increase in long-term employees' departure might imply the company's absence of career advancement programs.

Involuntary Turnover Rate

Unlike voluntary turnover, involuntary turnover refers to employees who were laid off or fired.

You can calculate involuntary turnover as follows: Involuntary turnover= (Employee layoffs/Average number of employees) × 100.

A higher-than-normal involuntary turnover rate could mean the company hires individuals who cannot align with its brand culture or identity. It could also indicate a lack of funds to maintain employment.

Employee Turnover Cost

This refers to the total cost of replacing an employee who left.

Onboarding costs, recruitment costs, overtime pay, unemployment benefits, and indirect costs such as productivity decline contribute to the total cost.

Employee replacement is capital intensive. Being aware of your turnover rate cost makes you more committed to fine-tuning your hiring practices and keeping the turnover rate low.


Making optimal business decisions relies on utilizing the right business metrics. One of those metrics is turnover rate.

Companies need to calculate employee turnover routinely, yearly or quarterly, due to its significant cost implications on business operations. Calculating employee turnover enables businesses to evaluate their performance concerning their competitors and industry standards.

Turnover rates should be monitored and correctly interpreted. And correct interpretation guarantees the identification of possible reasons for observed turnover and retention trends so that the company can make the necessary adjustments.

In a world of changing dynamics, knowing your turnover rate is only as good as having the correct interpretation and Assembly is your trusted tool. It keeps track of your turnover rates, providing valuable insights and identifying changes. You can book a free demo today.

Browse our Free Employee Recognition Guide

Get the foundational knowledge on creating an employee recognition program that boosts employee engagement and helps them feel valued.

Explore Guide

Frequently Asked Questions

Is Assembly SOC 2 compliant?

Yes, at Assembly, security is a top priority. Each quarter, we have ongoing security work that is everyone’s responsibility. While we maintain a strong security posture, it was important for us to prove to our customers that we do everything we claim to do. This led us to pursue a SOC 2 Type II report that would provide evidence of our compliance with industry gold-standard security practice.

What's the ROI for employee recognition?

There is study after study showing that employee recognition leads to increased engagement. This in return creates an environment where employees are happier and more motivated which increase productivity and reduces voluntary turnover significantly. In order to filled critical roles, companies tend to spend nearly twice the value of an annual salary. Assembly is an investment in your employees that supports your bottom line.

Does Assembly offer longer-term contracts?

Yes, we will offer contracts for companies with longer-term agreements to help larger customers have more certainty around future costs.

The minimum agreement term is a 12-month subscription.

Does Assembly offer onboarding support?

We do and for FREE! Any new customer needing further support to get started with Assembly to ensure you're set up for success can request custom onboarding support. Improving your employee experience is about much more than just using our amazing software; it’s about transforming your business to create a workplace that people love. That’s much easier to do with the personal support and advice from our passionate people experts.

Is there a free version of Assembly?

Yes. We offer a completely free plan for up to 50 team members. This plan is intended for teams or organizations that are looking to get started with an employee engagement tool. Keep in mind, this plan is limited in features.

All customers can open an Assembly account for free and get started without a credit card. Then you can change plans as necessary.

How much do rewards cost?

At the time of redemption (when your employees exchange their points for a paid reward) you'll pay face value. If a reward is a $10 Amazon gift card, your cost will be $10. All paid rewards are billed for on a monthly basis.

The good news is that you don't have to pay for rewards upfront because we only charge you when points are redeemed, not when they're earned.

Does Assembly offer discounts?

We offer discounts or educational or charitable organizations. In order to secure a discount, you'll first need to book a demo with a customer support specialist.

For all other organizations, we are willing to consider longer-term agreements in exchange for discounts. To set up annual plans or longer, you will need to book a demo with a customer support specialist.

How do I cancel my plan if needed?

If you're on a month to month plan, you can go here and cancel anytime. If you're having concerns or need help setting up your account for success, you can always book a demo with a customer support specialist.

If you're on a longer-term custom plan, you'll need to reach out to your customer support specialist to cancel your account or email us at

What customizations are available?

Great question! You can customize your core values to match your organization's to boost and track alignment. You can change your currency from the 🏆 emoji (our default) to any emoji of your choice. You can swap our logo for your own. You can also set up company culture rewards such as, "Lunch with the CEO," "Buy a book on us," and so much more!

Who can give or receive recognition?

While we recommend a peer to peer set up where anyone in your organization can give or receive recognition, you can set up Assembly however you want. If you need to limit the people who can give or receive recognition, that's perfectly fine and can be done from your Admin, here.

What integrations are available?

Assembly connects to the tools your employees use every day to offer an easy, seamless experience with minimal change management.  

Assembly has integrations with HCM/HRIS systems like ADP, Google, Office 365, and Slack. We also integrate with communication tools like Slack and Teams so you and your employees can access Assembly wherever they work now.

What's your average adoption rate?

That depends on the company's permissions set up. That said, over 90% of the employees on Assembly's platform are recognized on a monthly basis. That means nearly every employee across all of our customers are receiving regular recognition from their peers, managers, or leadership. We're extremely proud of this.

Must rewards be set up to use Assembly?

They are not required. You can use Assembly without having rewards set up. However, we don't recommend it if you intend to have a high adoption and usage rate. You can always keep the costs down by offering internal culture rewards that are fulfilled by you internally.

Are points required to use Assembly?

No, you can remove allowances from anyone or everyone. It's up to you but we do recommend using points whether they're worth a real dollar value or not. Companies that use points have a much higher engagement rate even if those points don't exchange for real dollars.

Could find the answer you are looking for?

Please schedule time with an expert and we will help you to get all your questions answered