The Employee Retention Rate is the measure that calculates the percentage of the number of employees who continued with their jobs over a fixed period.
There is a formula to calculate the Employee Retention Rate, which is as follows:
[Number of individuals employed during a specific period] / [Number of individuals employed at the beginning of the period] *100
The formula of the Employee Retention Rate should only consist of the individuals who remained employed during the entire period and excludes all of the individuals hired during the said period.
The retention rate is an important parameter for HR leaders as it helps them devise effective strategies to increase the retention rate.
The Company Retention Rate goes hand in hand with the employee engagement with the work. Retaining existing employees helps reduce the company costs, multiplying productivity, implementing workforce strategies efficiently, and addressing the relevant issues while recruiting new personnel. The calculation of this rate equips the department leaders with the data to ensure better employee engagement.
Increasing the retention rate requires certain retention strategies.