What is Attrition?

Attrition in a workplace refers to the gradual reduction in the size or strength of a workforce over time, typically due to employees leaving the organization voluntarily or through normal retirement.

It is a common phenomenon in any company and can be influenced by factors such as resignations, retirements, transfers, or other forms of normal employee turnover

Employee attrition is measured as a percentage and is often used by companies to assess workforce stability and plan for future hiring needs. Companies need to manage attrition effectively to maintain a stable and productive workforce.

Difference between Attrition vs. turnover?

Attrition includes voluntary and involuntary departures, while employee turnover includes the total number of employees who leave the company over a specified period regardless of the reason.

In a company of 100 employees, if 5 employees voluntarily resign within a month, the attrition rate for that month would be 5%.

In the same company of 100 employees, if 10 employees resign (voluntarily or involuntarily) within a month, the turnover rate for that month would be 10%. 

What is the main cause of attrition?

The main cause of attrition in the workplace stems from factors related to;

  • Employee dissatisfaction
  • Inadequate compensation and benefits
  • Limited opportunities for career growth or skill development
  • An unsupportive work environment. 
  • Poor workplace conditions

When employees do not have a work-life balance and a good organizational culture, they can experience employee burnout and leave voluntarily. When they feel unfulfilled or undervalued in their roles, they are more likely to seek opportunities elsewhere. 

How does attrition impact companies?

High employee attrition can lead to increased recruitment and training costs, negatively impact company culture, disrupt workflow, and lower overall morale within a company. It can also impede business growth and hinder productivity, even if the business is expanding. Additionally, attrition can cause a loss of institutional knowledge and experience, which may negatively impact the quality of work produced by the remaining employees.

Types of Attrition:

  • Voluntary Attrition

This happens when an employee voluntary leaves an organization due to certain problems in the company. For example, when an employee finds a better opportunity they will decide to leave the organization.

  • Involuntary Attrition

When a company dismisses the employees, it could happen because of the employees poor performance or due to some misconduct.

How do you solve attrition problems?

  • Maintain open lines of communication with employees to understand their concerns.
  • Provide employee autonomy and seek feedback to improve the work environment. 
  • Offer competitive compensation, benefits, and growth opportunities.
  • Create a psychologically safe environment.
  • Acknowledge employees and reward them for their contributions.
  • Invest in employee development through training programs.

Managing attrition is a crucial aspect of human resource management. By understanding its causes and implementing effective retention strategies, organizations can maintain a stable and productive workforce, ultimately contributing to long-term success and growth.

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