Attrition vs. Turnover: Key Differences, Calculations, and Tips

There has been confusion between employee attrition vs turnover in the industry. Although their meanings tend to be merged, they have distinctions that must be known, especially when aiming for company success.

In a survey, 42% of employees who left the company reported that the organization could have intervened and prevented them from leaving the job. This shows that employee attrition and turnover are preventable if only the company is more engaged with the workforce.

To help you capture the significance of employees leaving the company and how to mitigate it, here is an overview of the key differences between employee attrition vs turnover, their calculation, and tips to improve the rates.

What is employee attrition?

Employee attrition is the reduction of the workforce when employees leave, and the company does not plan on filling the vacant position. It is a natural process for the workforce and does not necessarily indicate negative issues in the company.

Here are examples of voluntary and involuntary attrition:

Voluntary Attrition

• Retirement

• New job opportunities

• Personal reasons

Involuntary Attrition

• Death or illness

• Layoffs or termination

• Elimination of positions

What is employee turnover?

Employee turnover refers to the number of employees that leave and are replaced in the company and often indicates issues within the organization. The company plans on filling the vacant position and will not let it remain unoccupied for a long time.

Here are examples of voluntary and involuntary turnover:

Voluntary turnover

• Toxic workplace culture

• Incompetent compensation and benefits

• Poor management or leadership

Involuntary turnover

• Violation of policy

• Excessive tardiness and absenteeism

• Negligence of job responsibilities

If your company has high employee turnover and attrition rates, this should raise concerns. It might suggest that your talent strategies and internal policies are not aligning with your employees.

One way to optimize employee retention strategies is to use real-time data from Real-Time Job Posting Salary Data Solution to keep you updated on the latest market trends, giving your people competitive talent management and employee satisfaction.

Differences between attrition vs turnover

There are key differences between employee attrition vs turnover, including its definition, filling of roles, indications, and significant implications for the company. Here is a rundown of these distinctions:

Definition

Attrition refers to the number of employees that leave and are not replaced in the company. Meanwhile, turnover refers to the number of employees that leave and are replaced in the company.

Vacant position

With attrition, the company does not plan on filling the vacant position. With turnover, the company plans on filling the vacant position and will not let it remain unoccupied for a long time.

Indication

Attrition is a natural process for the workforce and does not necessarily indicate negative issues in the company. Turnover often indicates issues within the organization.

Significance

A high attrition rate means the workforce is decreasing. This could be due to aging employees or a call for succession planning. A high turnover rate means a large number of employees are leaving and it could be due to a poor working environment and hiring strategy or lack of growth opportunities.

Plan of action

With attrition, the company must be proactive in succession planning and knowledge transfer. With turnover, the company must address the root causes of the issues that led to employee departure.

How to calculate attrition and turnover rates

As mentioned above, rates between attrition vs turnover have different significance to the company. Employee turnover rate and employee attrition rate can be calculated by following the steps with examples below:

Calculation for attrition rate

Example:

• In January 2024, you have 50 employees.

• 3 of them retired while 2 were laid off to cut costs.

• In January 2025, you now have 45 employees.

• In the span of 1 year, 5 employees left your company and were not replaced.

Step 1: Calculate the average no. of employees (January 2024 – January 2025)

Average no. of employees in a year = (Starting no. + Final no.) / 2

Average no. of employees in a year = (50 + 45) / 2 = 48

Step 2: Calculate attrition rate

Attrition rate = (No. of employees who left and not replaced / Average no. of employees over a period) x 100

Attrition rate = (5 / 48) x 100

Attrition rate = 10.42%

In this sample calculation, the attrition rate in a year is 10.42%, a percentage at which employees leave the company without being replaced.

Calculation of turnover rate

Example:

• In January 2024, you have 100 employees.

• 10 of them left the company due to lack of work-life balance.

• In January 2025, 5 employees were hired to fill the vacant positions

• Total number of employees after a year = (100 – 10 + 5) = 95

Step 1: Calculate the average no. of employees (January 2024 – January 2025)

Average no. of employees in a year = (Starting no. + Final no.) / 2

Average no. of employees in a year = (100 + 95) / 2 = 98

Step 2: Calculate turnover rate

Turnover rate = (No. of employees who left / Average no. of employees over a period) x 100

Turnover rate = (10 / 98) x 100

Turnover rate = 10.20%

Here, the turnover rate is 10.20%, which is the percentage at which employees leave and are being replaced in the company.

Companies should aim for lower attrition and turnover rates. One way to do that is to have insights into the current market and talent demands. Real-Time Job Posting Salary Data Solution can help you make informed decisions on talent strategies based on accurate and up-to-date data.

Tips to improve attrition and turnover rates

Here are strategies that you can use to improve your company’s attrition and turnover rates:

• Conduct exit interviews. Gaining feedback from departing employees allows you to recognize areas of improvement that will help minimize the company's turnover rate. Input from leaving workers will tell you what needs to change in the system.

• Build consistent communication. It is better to have open discussions with employees to avoid disgruntled workers and promote employee engagement. If the company is willing to provide solutions to the suggestions of employees, it will have a productive outcome.

• Have competitive compensation and benefits. Pay that is aligned with the current job market and benefits that support the well-being and needs of the employees will result in their satisfaction. If satisfied, they are less likely to leave the company.

• Optimize onboarding strategy. Giving a proper overview of roles and responsibilities, effective orientation and training, and a sense of belongingness will help employees feel that they are in the right company.

• Start succession planning and knowledge transfer. To aid attrition, succession planning and knowledge transfer develop talents and their skills, identify critical roles and successors, and implement training programs for knowledge preservation.

To improve employee attrition and turnover rates, you must build effective talent strategies, strong compensation packages, and a good overview of the current job market. Real-time Job Posting Salary Data Solution can help you with that.

This platform provides millions of data and job postings, so you are ahead of the market trends, ensuring employees have competitive pay and benefits and companies build robust talent strategies to alleviate turnover and attrition.

FAQs

Here are some common questions about attrition vs turnover:

Are attrition and turnover the same?

No, there’s a difference between employee attrition vs turnover.

Attrition refers to the number of employees that leave and are not replaced in the company. Turnover refers to the number of employees that leave and are replaced in the company.

What is the difference between attrition and retention?

Attrition refers to the metric at which employees leave the company, while retention refers to the metric at which employees stay in the company.

Does turnover mean quitting?

Yes, turnover can mean quitting. There are 2 types of employee turnover: voluntary and involuntary. In voluntary turnover, employees quit their jobs, and this is caused by various reasons like toxic company culture and poor compensation and benefits.

What is the formula for attrition and turnover?

• Attrition rate = (Number of employees who left and not replaced / Average number of employees over a period) x 100

• Turnover rate = (Number of employees who left / Average number of employees over a period) x 100

What is a good attrition rate?

A good attrition rate depends on the size and type of the company. An attrition rate of 10% or lower is considered good. Meanwhile, anything over 20% should raise concerns in the organization.

Is employee churn the same as turnover?

No, turnover refers to the number of employees that leave the company over a period, while churn is the combined number of employee turnover and attrition.