Opinions
Turnover facts and impacts
by Michele Majul-Ibarra
Employment in Winnipeg is on the rise, up 4.3 per cent over the last year. The Conference Board of Canada also expects Winnipeg’s labour force to grow 2.3 per cent in 2024. According to the July 2024 Manitoba labour market snapshot, the Downtown Winnipeg Biz reported that foot traffic appears to be increasing in Winnipeg’s downtown. Their organization tracked visitors to the city centre in the second quarter of 2024, finding a 23.5 per cent increase over the same period in 2023.
On the flip side, did you know that Canada ranked fourth globally for highest employee turnover in 2018? According to the 2024 Canadian Mercer Turnover Survey, the average turnover rate sits at 11.9 per cent. The retail and wholesale industry leads with a 25.9 per cent turnover rate, while the energy industry has one of the lowest at eight per cent.
Turnover is a normal part of any organization or business. As an example, promotion, retirement, medical leave, and family-related issues may play a natural role in employee turnover. To prevent turnover from continuing, employers have a difficult task to ensure they keep their employees from leaving. This is because employee turnover costs, not only financially, but it can also impact employee satisfaction and productivity for those who remain with their employer.
When a highly skilled or highly knowledgeable coworker leaves their role, the remaining employees then must complete the requirements of that job. No doubt this can cause stress on those having to cover while still completing their own job duties.
A study conducted by the Institute of Behavioral Research at Texas Christian University observed 353 clinical staff workers at several outpatient substance abuse treatment programs. The study found that those who were in programs with the highest turnover experienced higher job stress and lower support from leadership. They felt there was far less collaboration and communication within the organization. Unfortunately, for these reasons productivity of the employees cannot be the same as it would be with every job filled with those responsible for their own job tasks.
A study done by the Allied HR IQ’s 2012 Allied Workforce Mobility Survey reported some interesting findings regarding productivity. This report gathered insights of HR professionals who represent numerous company sizes in terms of annual revenue and number of employees, and represent such industries as government, manufacturing, retail, service, technology, energy, transportation, non-profit, and professional services. The study found that, on average it takes about eight months to develop a new employee to full productivity after having to replace an employee who departed their role. Of those surveyed, 27 per cent stated that it took closer to a year. Reasonably if it takes 8 to 12 months to get a new hire to full productivity, and others have had to take the time from their existing roles to train the new associate, there’s no doubt that productivity is directly affected by an employee leaving.
Despite of the negative impacts of turnover, positive outcomes can also result. When a turnover is triggered by internal promotions, employees can feel motivated knowing there are opportunities from within that they can look forward to. Lateral moves are often a signal to employees that there is room for growth and development.
Another positive outcome is that the organization and their employees can benefit from gaining new ideas and fresh perspectives from the new hires.
This article is intended for information purposes only and not to be considered as professional advice.
Sources:
The Conference Board of Canada, Major City Insights: Winnipeg – July 2024
https://www.jobbank.gc.ca/trend-analysis/job-market-reports/mb/job-market-snapshot
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4986917/
https://blog.clearcompany.com/27-surprising-employee-development-statistics-you-dont-know
Michele Majul-Ibarra, BA (Psych), IPMA-ACP, C.I.M. is a Director of Human Resources in the public sector. She holds the Advanced Certified HR Professional Designation with the International Personnel Management Association, and the professional designation C.I.M. through Chartered Managers Canada.