Attrition Rate

The attrition rate refers to the rate at which employees leave an organization over a specified period of time, often due to reasons such as voluntary resignation, retirement, or death. It is a key metric used by organizations to understand employee departures and assess the overall health of their workforce. Unlike turnover, which encompasses both voluntary and involuntary separations, attrition typically focuses on voluntary separations and is often considered when analyzing the natural decline in staff numbers due to personal reasons or career changes. In this article, we will delve into what attrition rate is, how to calculate it, the factors influencing it, and how businesses can manage and improve attrition rates. How to Calculate Attrition Rate The attrition rate can be calculated using a formula similar to that of employee turnover but focusing specifically on the natural loss of staff. Here’s the most common formula to calculate attrition rate: Attrition Rate=(Number of Employees who Left During the PeriodAverage Number of Employees during the Period)×100\text{Attrition Rate} = \left( \frac{\text{Number of Employees who Left During the Period}}{\text{Average Number of Employees during the Period}} \right) \times 100Attrition Rate=(Average Number of Employees during the PeriodNumber of Employees who Left During the Period​)×100 For example, if a company has 100 employees at the start of the year, 10 employees leave voluntarily throughout the year, and the average number of employees during the year is 95, the attrition rate would be calculated as: