High staff turnover is synonymous with a failing business. If an organization sees a constant slurry of new hires, only to quit (or be fired) shortly after, there’s clearly something going wrong – badly wrong.
Soaring employee turnover rates negatively impact a company and its staff in multiple ways. A constant need to hire new workers takes its toll on a company’s time (and costs a lot, too) and also affects the productivity and contentment of existing employees whose work day, time, task load, and even social culture within the workplace is continuously on the shift.
There’s no stability for them, and that can lead to them walking out the door as well. Perhaps one of the biggest high turnover issues is this: it steers the business away from its missions and visions. With all of this in mind, why does a sky-high staff turnover harm a company, and how?
Poor Product/Service Quality
Poor product and/or service quality is a common symptom of high staff turnover rates. But this effect isn’t always immediate; it’s often gradual, rearing its head slowly until the side effect becomes a much larger problem (and one that’s subsequently much more challenging to fix if left untreated).
Deteriorating productivity and below-par work quality can come about from disruptions in everyday operations, as skilled staff leave and are replaced by a never-ending flow of new hires who may not be as experienced. Plus, the time needed to train new employees can take away from the job at hand – the actual work.
Moreover, newly onboarded staff who may not be trained (or are still undergoing training) are more likely to make mistakes. That’s normal, of course, but it means existing team members have more on their plate; they may have to monitor the work of the newbies as well as their own (and fix it if it goes wrong).
Loss of Revenue
Staff turnover (whether high or low) always directly impacts a business’s revenue and overall profitability – no matter what causes low employee retention rates. Simpplr offers a list of clear reasons for this problem. The factors contributing to revenue loss include hiring expenses, labor required to train new people, reduced sales, and lowered productivity.
Naturally, hiring new staff costs a company in the short term, but the key word here is “short”. It’s expensive initially, but once new hires are trained and perform their jobs well, that initial cost is usually offset as they grow into their role and positively contribute to the company.
However, imagine if a business has constant droves of new hires because of high turnover rates – therein lies the issue; the costs, reduced productivity, and lost sales stemming from hiring new workers remain consistent and continually burden the business’s wallet, time, and consequently, the quality of work, product, or service.
Terrible Team Morale
Low workplace morale is another significant symptom of high employee turnover. If rates are high, it normally means new hires are quitting for a reason – poor working conditions, low pay, lack of training, poor management, or even workplace bullying.
This causes low morale among new hires, but also longer-term employees, too, who may then decide that enough is enough. Existing employees become overworked due to constant new (and untrained) new worker flows, not to mention the problems causing new hires to quit (or be let go) in the first place.
