Taming the Flee Factor—5 Essential Retention Metrics

Feb 02, 2023

Taming the flee factor - 5 Essential Retention Metrics

Keeping your best talent is essential to business success. Your retention strategy should prevent turnover, keep your star employees engaged, and inform you why employees stay or leave.

Employee retention has replaced talent acquisition as the top HR priority for next year, yet many leaders admit their retention strategy is still at the beginner or intermediate stage.

Many employees say their departure from their last organization was preventable, and a leading cause is a toxic work culture.

Turnover is expensive and time-consuming. Experts estimate the cost of replacing a salaried employee range from six to nine months of their annual salary.

For high-turnover, low-paying jobs, expect to pay about 16% of the salary to replace them. It is closer to 20% for mid-range positions, and for executive positions, you may pay 200% of their annual salary to replace them. (Centric HR).

If you don’t analyze why employees want to leave, you won’t be able to fix the problem. The “flee factor” could relate to aspects of your corporate culture, internal business processes, or technology that you need to change.

We recommend that you listen to your employees and gather feedback. But remember: only ask for feedback you can act on. Feedback without action will cause more disengagement. So you need an action plan to address problems.

Engagement, retention, and turnover data help you understand and manage workforce issues more effectively. That enables you to save money and time.

Here are five retention metrics that will help you understand your workforce.

1. Employee retention rate

What is it?

This measures the percentage of employees who stay within a set period. The formula is:

 Formula for Employee Retention Rate


For example, imagine a business with 600 employees lost 154 employees within one year. Their employee retention rate is 74.3%, calculated like this:

Example of retention rate calculation

Why calculate it?

The longer your skilled employees stay, the more they add value to your business through their knowledge and experience.

A reasonable employee retention rate is 90% or higher. If, for example, you have an employee retention rate of only 50% or lower, you have a severe problem.

The rate helps you diagnose the stability of your workforce. It is the first step in creating any retention strategy.

2. Retention rate per category

What is it?

The retention rate per category is the percentage of employees that stay with the organization. For instance, you might calculate the annual retention rate for your

  • managers (do certain managers have high staff turnover?),
  • departments (which departments have low retention rates?),
  • performance levels (are you losing high or low performers?), or
  • employee age groups (are you losing young workers or more experienced professionals?)

You may decide to combine categories and calculate the retention rate for female workers in your client services department or the retention rate for experienced data analysts in your IT department.

To calculate the retention rate per category, use the employee retention rate formula, and apply it to each employee. For example, your managerial retention rate is:

Formula for Retention Rate Per Catergory

Why calculate it?

Drilling into specific categories lets you see which workforce segments have excellent rates and which are hemorrhaging staff, and requiring attention.

3. Voluntary turnover

What is it?

The voluntary turnover rate is the percentage of employees who leave the job based on their own decision, not the employers.

Calculate it this way:

Voluntary Turnover

For example, if a small startup business employing four workers loses two workers who choose to leave the job within their first year of employment, then the voluntary turnover rate is (2/4) x 100 = 50%.

Why calculate it?

Before the pandemic, companies saw voluntary turnover rates of 12% to 20%. From 2022 on, firms should expect this to increase by about 4% (source: Gartner):

“For example, 25,000 employees would need to prepare for an additional 1,000 voluntary departure,” says Piers Hudson, Senior Director, Gartner HR.

Voluntary turnover is a good indicator of employee satisfaction. When people find better opportunities, it’s normal. Common reasons for voluntary turnover include:

  • a new job with better learning opportunities,
  • overwork and better work-life balance,
  • a poor manager causing low morale,
  • a toxic corporate culture, and
  • poor compensation.

4. Employee job satisfaction rate

What is it?

The employee job satisfaction rate measures how happy people are with their jobs. Many firms calculate it as a percentage, using an Employee Satisfaction Index (ESI) of three questions, measured on a scale of 1 to 10. The questions are:

  1. How satisfied are you with your workplace?
  2. How well does your workplace meet your expectations?
  3. How close is your workplace to your ideal job?

The formula for calculating ESI is as follows:Employee Job Satisfaction Rate

Why calculate it?

Employee happiness is one of the most important indicators of your overall company culture. It may include a mix of many factors, such as

  • job duties,
  • relationships with colleagues and managers,
  • working conditions,
  • salary levels,
  • the level of flexibility in working hours, and
  • the impact on personal life.

Measuring ESI over time lets you track progress in the quality of your organizational culture.

5. Flight risk

What is it?

Flight risk is the percentage of your workforce likely to leave. For large organizations, using predictive analytics models can identify flight risks.

There are four steps to conduct an employee flight risk assessment:

  1. Gather data on past employees to identify common patterns linking people who resigned. For example, you may use data on qualifications, the time between promotions, changes in employee productivity, excessive absenteeism, disengagement, performance review scores over time, shared managers, and more.
  2. Analyze the data to predict who is most likely to resign soon. You can use Excel spreadsheets based on a statistical model or automated predictive analytics tools.
  3. Decide which employees to focus on by using an employee flight risk assessment
  4. Decide on your course of action. For instance, will you do a personal interview? Offer more compensation? A new learning opportunity? More flexible work hours? A transfer to a better manager?

Why calculate it?

Replacing employees is expensive. Vacant positions disrupt workflows and production. Sometimes, respected employees who resign may affect the remaining workers if they share similar challenges.

The flight risk retention metric is especially relevant for top performers and key contributors. If you understand why people want to leave, you can prevent it.


For many employees, work is more than wanting to learn and progress and feel valued and respected. Compensation, while important, is often not the primary reason people quit.

In addition, younger workers born between 1995-2010 pay more attention to a firm’s value—judged via action on ESG policies. If they don’t respect what a firm stands for, they’ll start looking elsewhere.

Cornerstones of any good retention strategy include building good employee engagement and fostering a positive, motivating corporate culture where employees see how they can advance.

 About Pixentia

Pixentia is a full-service technology company dedicated to helping clients solve business problems, improve the capability of their people, and achieve better results. 

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