Organizational Wellness

9 Tips to Reduce Your Attrition Rate

Jul 18, 2023
Last Updated May 21, 2024

Attrition rate essentially measures how often employees leave a company — whether by choice or not — and need to be replaced. 

In other words,  High attrition rates can be a real headache for organizations, causing increased costs for recruiting, lower productivity, a loss of valuable knowledge, and even disruption within teams. Between 2021 and 2022, the average turnover rate was nearly 25% for U.S. businesses, according to Mercer, and this number will only continue to grow if businesses do not take proactive steps to improve their employee retention.

That is why smart companies are taking action to reduce attrition rates and hold on to their valuable workforce. They are creating environments that support and engage employees by offering opportunities for professional growth and addressing individual needs. It’s all about building loyalty, boosting morale, and ultimately improving the overall performance of the company. 

So, let’s take a closer look at effective approaches that can help reduce attrition rates and enjoy the fantastic benefits of employee retention.


How to Calculate Employee Attrition Rate

Attrition rate refers to the measurement of employee turnover within an organization and is often expressed as a percentage. You can calculate your company’s attrition rate in a few simple steps:

  1. Determine the time period. Begin by selecting a specific time frame for calculating the attrition rate, which is related to employee retention. It can be monthly, quarterly, annually, or any other suitable duration that aligns with your organization's reporting needs and goals.
  2. Collect the necessary data. Assess the number of employees who left the organization during the designated period. Consider both voluntary resignations and retirements, as they contribute to the overall attrition.
  3. Calculate the average number of employees. Determine the average number of employees during the same time period. To do this, add the starting and ending headcounts of employees for that duration and divide the sum by two. This step helps normalize the attrition rate against the average workforce size.
  4. Divide the number of employee departures. Divide the number of employees who left during the specified period by the average number of employees calculated in the previous step. This division will provide you with the attrition rate as a decimal figure.
  5. Multiply the number by 100. Multiply the result from step 4 by 100 to convert the decimal into a percentage. This multiplication allows you to express the attrition rate in a more easily interpretable format as a percentage.
  6. Interpret the attrition rate. Analyze the calculated attrition rate to understand the level of turnover within your organization. A higher attrition rate indicates a higher rate of employee departures, which can have implications for workforce stability and retention efforts. Assess whether the rate aligns with industry benchmarks and evaluate its impact on your organization's overall performance, culture, and talent management strategies.

Your organization can gain valuable insight into its employee turnover dynamics and identify areas for improvement by regularly calculating and monitoring the overall attrition rate. This data-driven approach enables them to make informed decisions and implement targeted initiatives to reduce attrition, boost employee retention, and foster a more stable and engaged workforce. 

What Is a Good Attrition Rate?

Calculating your company’s attrition rate is a good place to start, but no number means anything until you can interpret and apply it to your policies and practices. 

Determining what qualifies as a good attrition rate for an organization involves considering multiple factors. Two key considerations to keep in mind when evaluating your attrition rate are the industry benchmark and retention rate of top talent. 

  1. Industry Benchmark. It is essential to research and identify the average attrition rate within your industry. Different industries have varying dynamics and talent market conditions that influence turnover rates, so comparing your organization’s rate to industry benchmarks provides valuable context and allows you to assess how you fare against your peers. This benchmark serves as a starting point for understanding what is considered typical within your specific sector. 
  2. Retention of Top Talent. While industry benchmarks provide a broad perspective, it is equally important to focus on retaining your high-performing employees. These individuals critical to your company’s success are invaluable assets. Ideally, a good rate is low enough to indicate a minimal loss of valuable employees and maintain continuity within crucial roles of the organization. 

A consistently low attrition rate typically indicates that your organization has successfully created a work environment that nurtures employee satisfaction, engagement, and growth opportunities. Such environments foster loyalty and contribute to a stable workforce, which is beneficial for long-term organizational success.

Nine Strategies for Managing Attrition Rate

Consider the following as valuable strategies to keep attrition rate under control. 

Improve recruitment and selection processes.

Invest in effective recruitment strategies to attract the right talent from the beginning. You can build a talent pipeline and streamline the selection process to ensure that candidates’ skills and cultural contribution within the organization are assessed accurately. You may wish to develop relationships with professional networks and other industry organizations to establish a pool of qualified potential candidates. 

Enhance employee onboarding and orientation. 

Create a comprehensive onboarding program to help new hires acclimate to the organization. One of the best ways to keep top talent around is by providing them with the tools and resources they need to succeed from day one. Consider assigning mentors to guide new employees during their initial days with the company, as well as providing access to the necessary training and support resources to facilitate a smooth transition. 

Develop competitive compensation and benefits packages. 

Conducting market research can help ensure that your compensation packages are competitive. No matter how much your employees are dedicated to the company vision, they need fair compensation. Regular review and adjustment of salaries and benefits based on industry standards and employee feedback are also valuable steps in crafting a compensation strategy that decreases attrition. You can also offer additional perks and rewards that align with employees’ preferences and needs. 

Provide career development and growth opportunities. 

Organizations can implement a performance management system that incorporates regular feedback and goal-setting discussions. They can also provide employees with valuable training programs, mentorship opportunities, and the chance to explore different roles through job rotations. Clear pathways for advancement within the organization, such as promotions and internal job postings, can be established to encourage employees' professional growth. These initiatives enhance employee satisfaction while contributing to a more skilled and motivated workforce.

Foster a positive work culture and employee engagement. 

Promote a supportive and inclusive work environment where employees feel valued and respected. Encouraging teamwork, collaboration, and recognizing achievements further enhances this atmosphere. To foster team cohesion and employee morale, your HR department can organize team-building activities, social events, and employee appreciation programs. By prioritizing a positive work culture, you can cultivate a sense of belonging, increase employee engagement, and ultimately reduce attrition rates.

Enhance leadership and management capabilities. 

Provide leadership development programs to equip managers with the skills they need to effectively lead and inspire their teams. Ongoing training and support should focus on enhancing communication and conflict resolution at every level of the organization. By fostering a culture of trust and transparency, where leaders actively listen to employees and act as mentors, you create an environment where employees feel valued and supported. 

Implement retention programs and initiatives. 

Companies should proactively address the factors that contribute to employee turnover. This can be achieved through targeted retention programs aimed at understanding and mitigating the underlying causes. Conducting exit interviews is a valuable tool to gain insights into the reasons for employees' departures and make necessary improvements within the organization. Offering incentives and rewards for employee loyalty and tenure can significantly contribute to reducing attrition rates by enhancing employee satisfaction and fostering a sense of loyalty. These measures can create a supportive and engaging environment that encourages employees to stay and grow with the company.

Encourage open communication and feedback. 

Creating a culture of open communication is vital in reducing attrition rates and promoting employee engagement. Organizations can establish various channels to facilitate this, including regular team meetings, suggestion boxes, and anonymous feedback systems. Actively listening to employees' feedback and promptly taking action to address their needs and concerns demonstrates a commitment to their wellbeing. 

Prioritize employee wellbeing and work-life balance. 

Offering flexible work arrangements, such as remote work options or flexible schedules, can help accommodate individual needs. Actively promoting work-life balance includes encouraging employees to take breaks, vacations, and time off to recharge and rejuvenate. Providing resources for mental wellbeing, as well as implementing initiatives like wellness programs or employee assistance programs, demonstrates a commitment to prioritize employee wellbeing.

By implementing the above strategies, organizations can create a work environment that fosters employee satisfaction, engagement, and commitment, leading to reduced attrition rates and a more stable and motivated workforce.

Taking Charge of Attrition Rates with Wellhub

Reducing attrition rates is a crucial focus for HR departments, as it directly impacts organizational success and stability. By implementing effective attrition management practices, HR leaders can create a loyal and engaged workforce that drives growth. 

Prioritizing employee wellbeing through wellness programs and work-life balance can help reduce attrition. We found that 87% of employees say they would consider leaving a company that doesn’t focus on wellbeing. Your team needs to feel supported outside of just the workplace. 

Wellhub can help you implement wellness programs that address the needs and desires of your employees, helping reduce attrition rates through boosting employee wellness. Talk to a Wellbeing Specialist to get started.

Company healthcare costs drop by up to 35% with Wellhub! (* Based on proprietary research comparing healthcare costs of active Wellhub users to non-users.) Talk to a Wellbeing Specialist to see how we can help reduce your healthcare spending!


  1. Mercer. (2023, February 24). How much turnover is too much? Retrieved June 7, 2023 from


Wellhub Editorial Team

The Wellhub Editorial Team empowers HR leaders to support worker wellbeing. Our original research, trend analyses, and helpful how-tos provide the tools they need to improve workforce wellness in today's fast-shifting professional landscape.


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