Good Employee Turnover Rate at Your Business
Leadership Development

Good Employee Turnover Rate at Your Business

Bonnie Hagemann • October 19 , 2022

Employee Turnover at Your Business

In today’s workplace, an organization’s strength lies in how it will recruit, invest in, retain, and treat its people. Organizations desire talented and productive employees and should act to retain their talent for as long as possible. Employees, too, now more than ever desire to work for organizations where they feel valued, supported, and empowered. A loss of talent in any organization or industry can be challenging for a business, its leaders, and its efficiencies and goals. However, some employee turnover can be good, healthy, and normal for a business. 

Leaders who learn about employee turnover and how it can affect their business are taking the critical first steps to understand the possible short-term and long-term problems high employee turnover can create for their business. Calculating your employee turnover rate can help your organization understand its turnover rate and what this looks like for the business. This rate helps organizations see if their employee turnover is high or low, where they fall within their industry’s average, and provides leaders with greater insight into the employee experience within their business.  

What is a Good Employee Turnover Rate? 

When it comes to an employee retention rate at a business, a general rule is that a retention rate of ninety percent or higher is considered good and ideal for a business. This means your business is hiring and retaining ninety percent of your employees measured within that given time period. A ninety percent retention rate yields an employee turnover rate of only ten percent at a business, which would be considered an ideal and healthy turnover rate for an organization and its people.  

A ten percent employee turnover rating can demonstrate that the organization and its leadership are proactive when it comes to hiring and retaining their talent and keeping their people happy at work. This employee turnover percentage is low and will likely not be too costly for a business relating to finances and training or creating issues in workflow efficiencies. Low employee turnover also benefits your people, workplace experience, and the organization’s cultural health.  

Although this ten percent employee turnover rate is considered ideal, it is not always likely for organizations to maintain this exact percentage. According to Business News, the average employee turnover rate today is between 12% to 20% for most businesses. Each business and industry will face unique challenges of their industry as well as different types of employee turnover. There are also external factors beyond a business’s control relating to employees leaving their business. This will lead to your employee turnover rate fluctuating and not always remaining the same.  

How to Maintain a Good Turnover Rate at Your Business  

With employee turnover challenges differing across all organizations and industries, leaders must drive action by understanding the unique needs of their business. Each of the following examples can help an organization maintain a good employee turnover rate at their business. 

  • Connect Your Employees Work to Your Organization’s Purpose – Leaders should encourage employees in their roles and provide them with a meaningful and positive work experience. Leading employees with a compelling and engaging company vision can help connect employees to their work and allow them to feel valued and empowered in their day-to-day responsibilities. As a business, it is vital for leadership to connect with the organization’s purpose as well as the employees. Leaders should model their organization’s values and empower their team to do the same. Not only will this leave employees feeling inspired, but will improve efficiencies in company strategy, enhance a business’s cultural health, and help a business maintain a good employee turnover rate.  

Check out EDA Inc.’s CEO Bonnie Hagemann’s book Leading with Vision to learn more about how a compelling company vision can enhance your workplace culture and improve employee retention.  

  • Providing a Flexible Business Culture – Employees value a work environment where they feel supported and have flexibility in both their personal and professional lives. This will add value to your business’s employee retention practices, as work-life balance is highly sought by the talent of today’s marketplace. Providing flexibility in remote and hybrid-work models is a desirable benefit most businesses can provide to their employees. Other benefits are flexibility in working hours and providing employees with paid time off for their personal use. Leaders must act to empathize with their people and create flexibility in their organization’s culture or risk losing that talent to other businesses that will. Employees who feel trusted and rewarded in their roles will perform better for your business and will help your organization maintain an optimal turnover rate.
  • Invest in and Upskill Your Employees – According to Gallup, fifty percent of workers in the US want to update their skill sets, and forty-eight percent of those same workers have considered switching jobs to do it. Leaders should invest in their employees to enhance their competencies and skill sets. In turn, businesses should do the same to their managers and high potentials. Upskilling your current and new incoming talent will enhance your people and in turn benefit your business and its success. A healthy turnover rate demonstrates a culture of growth and innovation. Engaging employees in training, development, and hands-on business initiatives, as well as upskilling your managers and high potentials, will be critical to your business’s success. You will enable your employees to perform better and your business will reduce its talent gaps, improve productivity, and excel in hiring and retaining top talent in the marketplace.   


Employee turnover occurs in every business and industry, but leaders must recognize this turnover and the impact it has on their business. Employees leave a business for diverse reasons, so calculating and understanding a good employee turnover rate is vital for the future talent and success of your business. It is also critical for businesses to better understand their own industry and marketplace to further improve their employee retention. With diversity in industry needs and today’s competition within the marketplace, leaders must deep dive into employee turnover and its unique impact on their business.  

Leaders must act to enhance their own skill sets to lead with a compelling and connected vision and approach. They must also act to enhance the development and talents of their current people and to provide value to potential incoming talent. Every organization is different and will require unique circumstances to maintain a good employee turnover rate. But all organizations can benefit from providing connection, investment, and flexibility to both their current and incoming talent.  

An organization is made up of your people, so its business and leadership must do their part to continue retaining top talent. Leaders can strive to better excel in their roles by further enhancing and developing their skillsets and competencies, as well as the business making changes to any strategies to reduce the risk of high employee turnover issues. Your people are your most important asset and leaders need to enhance their business into an employee-first culture. Doing so will improve employee retention and help your business maintain a good employee turnover rate. This will also help you to hire and retain the best talent for your business and allow you to thrive within your industry.  

Businesses should focus on the following to maintain a good employee turnover rate: 

  1. Connect your employees to the organization and its mission 
  2. Invest in and upskill all your employees, including all managers and high potentials 
  3. Create an employee-first culture of flexibility and trust  

Ideally, organizations should strive to maintain an employee turnover rate of ten percent or less, however, each industry will differ in these circumstances. The average employee turnover rate is from twelve percent to twenty percent; therefore, your business should work to achieve within this range to keep a good employee turnover rating. This will improve employee retention at your company and the overall work experience for your employees. 

Having a Great Partner Can Help 

We at EDA utilize a results-driven and practical approach to addressing your business needs. With industry-leading experts and our high-level and dynamic service offerings, EDA is here to guide and support your organization through these challenging times and obstacles in the workplace. Employee turnover will continue to be a critical factor in all business settings and we at EDA are here to help bring the awareness and effective change needed to reduce employee turnover in your business.  

EDA provides a range of programs including executive development, leadership development, and high-potential development, as well as specific programs for healthcare, government, or universities. Check out more about EDA services and how we can help your business and its leaders to reduce employee turnover and increase employee retention. 

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