Definition
Turnover rate measures how quickly employees leave the organization, voluntarily (resignation) or not (dismissal, end of contract). For recruiting, the most telling variant is early turnover: departures within 90 days or the first year, often linked to a poorly described job or a failed onboarding.
Formula
Turnover rate = departures in the period / average headcount in the period × 100.
Average headcount = (headcount at start + headcount at end) / 2.
Illustrative example: a company has 48 employees on January 1 and 52 on December 31, for an average headcount of 50. It records 9 departures during the year. Annual turnover rate: 9 / 50 = 18%. If 4 of those departures happen in the first 90 days, the problem is more likely in recruiting and onboarding than in management.
Key takeaway
Separate voluntary and involuntary departures, and track early turnover on its own. Every departure restarts a search: the cost of a bad hire guide helps put a number on the impact.