What is meant by 'employee turnover'?

Employee turnover refers to the rate at which employees leave an organization and are subsequently replaced by new hires. This concept is crucial for businesses as it impacts overall workforce stability, productivity, and morale. High turnover can indicate underlying issues within the company, such as dissatisfaction among employees, lack of growth opportunities, or ineffective management practices. Conversely, a low turnover rate often suggests a healthy work environment where employees are satisfied and engaged.

Understanding employee turnover helps organizations strategize on retention methods, improve hiring processes, and enhance workplace culture, which can ultimately lead to better performance and reduced costs associated with frequent hiring and training.