Impact of Employee Turnover on Companies: Problems and Solutions

Skills for Higher
Education

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK...............................................................................................................................................3
Problems faced by companies ....................................................................................................3
Solution ......................................................................................................................................4
CONCLUSION ...............................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Employee turnover can be described as total number of worker who are leaving company over
specific period of time. It consist those people who exit organisation as well as employees who
are fired as well as laid off from organisation. Increasing employee turnover is a problems for an
organisation as it create various negative impact over company (Arachchi and Dahanayake,
2020). There are various reason for which people leave organisation and it is a situation which is
unavoidable for company. Employee organisation due to lack of growth and progression
opportunity in an organisation as an individual is always looking for growth opportunities.
Increasing work burden over employees also make them dissatisfied due to which they leave the
organisation. Lack of performance feedback as well as recognition is also make an employees
dissatisfied as a person require recognition and rewards in order to get opportunity. If
organisation does not include employees for process of decision making will make them
dissatisfied. It will prevent them from from getting success due to which they will leave
organisation. Due to all these reason employee will leave organisation that will create negative
impact over performance of company. This essay includes discussion of business problems cause
through high turnover of staff as well as provide potential suggestion to a person.
TASK
Problems faced by companies
There are various problems faced by companies due to increasing turnover. Human resources are
considered as an asset of company and if company is loosing these people, it can create impact
over companies (Yingjie, Deng and Pan, 2019). Some of problem faced by companies due to
increasing turnover are mentioned below:
Turnover on revenue and low workplace morale:
Employee turnover is creating negative impact over revenue as well as profitability of company.
For instance, according to a study, it is identified that cost of company for losing an employee
earning is of $8 for an hour in retail chain. There are also some other cost associated with this
including hiring of new employees, training of employees, lower productivity, lost sales and
others. It create impact over revenue of a person that is depended on industry wages and position
of employees (Zhang and Li, 2020). There are different package is offered to employees which
create expense for company as there is no return on investment for some time. Management also