5 Big Factors Affecting Employee Attrition

5 minute read

Posted by Chris Platts on 28 July 2021

Imagine you’re in a job that you don’t like and you decide to leave. Now imagine that you’re in a job that you love but you have to relocate and reluctantly resign. 

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On a company’s side of things, both of these situations lead to the same outcome; turnover, but they are very different situations with very different sentiments. 

This post delves into the 5 main reasons affecting employee attrition, and what you can do as a company to prevent it.

Why is Understanding the Factors Affecting Attrition Important?

For many people, the reasons behind leaving a job can be deeply personal. A clash with a colleague, not receiving a promotion, or a change in life circumstances. However, finding patterns in factors like these is the first step in trying to prevent them in future. Information is knowledge and tracking the causes of staff attrition will help to convince internal stakeholders that investment is required to tackle turnover problems.

5 Big Factors Affecting Employee Attrition

Within this article, we will go over 5 different factors that affect employee attrition, and how to tell if your company, department or team is at risk with any of these factors.

1. Pay 

For many, wages have not kept up with inflation or with employee expectations. Pay increases can be measured by raises, bonuses, and other types of monetary incentives that employees may be offered. The reality is money has a lot to do with whether or not an employee will stay with a company; most employees will leave for more money if the role and company are comparable. Replacing employees is more costly for an organisation than increasing pay; an average employee exit costs about 33% of their annual salary, but it can be considerably more. This shows that there is an actual, tangible cost-saving metric to offering a pay increase to retain staff.  

2. Workload 

Productivity expectations have increased during the pandemic and this can affect employee turnover. Workloads before the pandemic seemed to be enough to cover an entire 9 to 5 workday. However, throughout the pandemic, many people working from home have filled their commuting time with work too. This “always-on” culture has a big downside; employee burnout.

According to this article in Forbes Magazine, one manager recalls that at the beginning of the pandemic their employees were nervous but ready to take on the challenge of working from home with an overwhelming sense of motivation. As the pandemic continued, this manager says that they began to see that motivation diminish, and burnout set in. Burnout stems from feeling distanced from work or from family, feeling less efficient and meaningful to a company, and feeling emotionally or physically exhausted. These feelings were magnified by the expectations that many managers adopted through the pandemic that employees “were not busy enough”, which showed to be greatly disadvantageous to these employees and their performance. 

factors affecting employee attrition - employee burn out
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3. Flexibility 

Without work flexibility, employees are much more likely to leave. In order to combat this, there are a few things that companies can keep in mind. First, it is important to know that offering geographic flexibility will increase the reach of your talent pool. It may also increase the satisfaction employees will have, thus increasing the chance of retention and employee referrals. Second, younger employees now expect work flexibility; according to a survey, 84% of millennials want more work-life balance, and 67% want more time to spend with their families. Third, incorporating flexibility creates more employee satisfaction; according to recent data two-thirds of people prefer working from home, and 36% would choose that option over a pay raise.

4. Development

Another key factor that affects employee attrition is career development. When companies have too few development opportunities people leave. So too when employees are too busy to take advantage of them they tend to look elsewhere too. Data shows that employees who feel as though they have the opportunity to rise through the ranks of the company are 20% more likely to stay. 

Career development on the whole is slowing down. Today, on average, people stay in their roles for 50% longer than in 2008. Of course, creating promotion opportunities out of thin air isn’t always possible in which case many companies aim to provide more career experiences. These could be secondment opportunities, planned career breaks or offering re-skilling opportunities. 

5. Hiring 

The last big factor affecting employee attrition is hiring. As pre-hire assessment providers hiring people who stay is something we at ThriveMap know a lot about! In one of our other blog posts, we go into more detail on how to reduce employee attrition through the hiring process and detail the mistakes that can be made. When evaluating candidates, it is important to look for early warning signs throughout the hiring process. For example, is the candidate engaged? Do they know exactly what the job entails? In fact, 48% of people leave a job because their duties are not what they thought they would be, and 31% of people leave a job because the company culture is not how they expected it to be. By using pre-hire assessments and real-life work scenarios in the hiring process, new hire attrition can be greatly decreased.

In Summary

The most important factors that affect employee attrition are pay, workload, flexibility, development, and hiring. Knowing and understanding these factors plays a huge role in the decreasing of employee attrition within a company, and can help firms greatly in the long run.

How effective is your hiring process?

We wrote a guide to fair hiring and we think you’ll really enjoy it.

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About ThriveMap

ThriveMap creates customised assessments for high volume roles, which take candidates through an online “day in the life” experience of work in your company. Our assessments have been proven to reduce staff turnover, reduce time to hire, and improve quality of hire.

Not sure what type of assessment is right for your business? Read our guide.

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