Retention Strategies

Costs of Attrition

Quite often, the cost of leaving a company is underestimated. The following are the costs of attrition:

  • Direct costs: Administrative costs, hiring and training costs
  • Real costs: Productivity loss during vacancy
  • Intangible costs: Loss of client relationships, impact on competitive edge, psychological impact on survivors

These costs are rarely calculated. Here is a method of calculating the costs of attrition:


Step 1:

Choose a target position for which the attrition costs are to be calculated (for example, senior sales manager).

Step 2:

List the total number of employees in the target group (for example, 20).

Step 3:

Note how many of these employees have quit in the last year (for example, five). ...

Get Hurconomics for Talent Management: The Creation of a Business-driven HRD Missionary now with O’Reilly online learning.

O’Reilly members experience live online training, plus books, videos, and digital content from 200+ publishers.