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The 7 Biggest Reasons for Employee Turnover

Cassandra Rose, SPHR, SHRM-SCP
A person is sitting at their desk with their head in their hands. They have an opened laptop, two notebooks, a phone and their glasses sitting on their desk.


Based on a 2021 report from the Bureau of Labor Sta­tis­tics, cur­rent employ­ee turnover rates are 57.3%, with vol­un­tary turnover at 25%. A quar­ter of all employ­ees leave their jobs because they aren’t hap­py and believe they will have more suc­cess elsewhere.

Turnover rates this high can sig­nif­i­cant­ly impact a company’s bot­tom line and, more impor­tant­ly, cre­ate stress for the employ­ees that choose to stick around.

The True Cost of Employee Turnover

A person is handing another person forms on a clipboard. One person is wearing a blue button-down and the other is wearing a cream sweater.


The real­i­ty is that the hir­ing and train­ing process is expen­sive. When a com­pa­ny is forced to replace some­one, it doesn’t just cost them that employee’s salary. They must also pay for new recruit­ment, job post­ing, mar­ket­ing, train­ing and exter­nal relief for the time it takes to get an employ­ee accli­mat­ed to the team and pro­duc­tive in their new role.

That is assum­ing the employ­ee actu­al­ly sticks around. If the prob­lems still exist that caused the orig­i­nal employ­ee to leave, the new hire might choose to leave, too.

The sec­ond sig­nif­i­cant cost of employ­ee turnover is the inevitable strain it puts on exist­ing team mem­bers. When a posi­tion is vacant, the work asso­ci­at­ed with that posi­tion doesn’t just dis­ap­pear. Instead, anoth­er per­son with­in the orga­ni­za­tion must pick up that slack, reduc­ing over­all pro­duc­tiv­i­ty and caus­ing increased lev­els of stress and employ­ee burnout.

For­tu­nate­ly, most of the rea­sons employ­ees leave are entire­ly pre­ventable. Sim­ply put, peo­ple are less like­ly to give up gain­ful employ­ment with­in an orga­ni­za­tion that shares their val­ues, rec­og­nizes their tal­ent and offers com­pet­i­tive com­pen­sa­tion, per­son­al­ized ben­e­fits and career devel­op­ment opportunities.

7 Most Common Causes of Employee Turnover

A person is laying their head down on their arm. They look bored while staring at their computer screen. They have a stack of books on their desk.


1. Poor Compensation

Giv­en the insta­bil­i­ty of the glob­al econ­o­my, it’s fair to say that it’s pret­ty expen­sive to thrive in this day and age. Peo­ple need jobs that afford them the abil­i­ty to work full-time with­out wor­ry­ing about whether they can pay their bills on time and feed their fam­i­lies. If a com­pa­ny doesn’t offer fair com­pen­sa­tion that cov­ers the bare neces­si­ties of life, their peo­ple will quick­ly find an orga­ni­za­tion that does.

A person is handing another person forms on a clipboard. One person is wearing a blue button-down and the other is wearing a cream sweater.


Peo­ple spend almost half their wak­ing hours at their jobs, so all that time shouldn’t feel wast­ed. That’s why orga­ni­za­tions must do every­thing in their pow­er to cre­ate a fun, engag­ing and inspir­ing work envi­ron­ment. Employ­ees that are con­tin­u­ous­ly engaged in their work and hap­py with their envi­ron­ment don’t suf­fer from chron­ic boredom.

3. No Feedback, No Recognition

Whether it’s week­ly feed­back ses­sions, one-on-one meet­ings to eval­u­ate per­for­mance or peer recog­ni­tion pro­grams, a tiny bit of appre­ci­a­tion can real­ly go a long way. Employ­ees love to know that their hard work is rec­og­nized and val­ued by their employ­ers. Team lead­ers and super­vi­sors should cre­ate sys­tems that imple­ment and enforce pos­i­tive and con­struc­tive employ­ee recog­ni­tion on a reg­u­lar basis.

4. Burnout

A person is sitting at their computer with their hand against their head. They also have a notebook, phone and drink on their desk.


Burnout is a lead­ing cause of employ­ee turnover and, unfor­tu­nate­ly, it can be a cycli­cal issue that doesn’t have a sim­ple solu­tion. When an orga­ni­za­tion is short-staffed, ill-man­aged or strug­gling with turnover rates, employ­ees are the ones who are forced to shoul­der the bur­den. If an employ­er wants to improve reten­tion, they must take the time to ensure their peo­ple aren’t over­worked or under­ap­pre­ci­at­ed and fix the issues that made them short-staffed in the first place.

5. Lack of Growth

No one wants to find them­selves in a stag­nant job with­out the oppor­tu­ni­ty for career devel­op­ment and growth. If an employ­ee believes there’s no upward mobil­i­ty with­in their orga­ni­za­tion, they might choose to go some­where else. If a com­pa­ny would like to reduce employ­ee turnover and increase their team’s over­all hap­pi­ness and pro­duc­tiv­i­ty, they should offer oppor­tu­ni­ties for advance­ment and reg­u­lar career development.

6. Company Culture

group of people is sitting down, and it appears that they are having an argument. There is a white rug on the ground on top of grey concrete flooring.


Many peo­ple leave orga­ni­za­tions based pure­ly on an inter­nal con­flict with com­pa­ny cul­ture. Employ­ees love it when the orga­ni­za­tion they call home shares their val­ues and pro­motes pos­i­tive change in the world. Unfor­tu­nate­ly, many peo­ple can also feel dis­con­nect­ed, dis­en­gaged and under­rep­re­sent­ed by their company’s cul­ture, which leaves them feel­ing unmo­ti­vat­ed, unin­spired and unhap­py at work.

7. Impersonal Benefits

Ben­e­fits like health insur­ance, retire­ment funds, 401k and life insur­ance are essen­tial com­po­nents of an employ­ee ben­e­fit pro­gram. How­ev­er, they aren’t enough to stay com­pet­i­tive in today’s aggres­sive job mar­ket. A one-size-fits-all approach just doesn’t work any­more. After all, no two peo­ple are exact­ly the same, and their ben­e­fits shouldn’t be either.

Fringe’s cus­tomiz­able, per­son­al­ized ben­e­fits plat­form puts the pow­er back in the hands of the employ­ees — after all, that’s where it belongs. It allows them to choose the ben­e­fits that will have the most sig­nif­i­cant impact on their lives. By serv­ing the indi­vid­ual needs of their peo­ple, com­pa­nies can make their peo­ple feel val­ued, com­bat burnout, increase com­pen­sa­tion and boost employ­ee retention.

Con­tact us today to get start­ed and start giv­ing back to your people.

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