Understanding why people leave your organization will help you get your retention strategy right.
Understanding voluntary turnover — why people leave and what, if anything, can be done to address the issues — is an essential part of creating an effective talent retention strategy.
ADP has analyzed anonymized records from January 2015 to January 2018 to understand whether separations were voluntary or involuntary, and what reasons were given for the separation.
The most common reasons for voluntary turnover are:
Personal reasons: This is a catch-all category that can include many possible circumstances such as moving with a partner, going back to school, making a career change, wishing for a different boss, wanting more money or deciding to travel the world. The category "personal reasons" is the most difficult to address from a policy or process level because each case will be different and each solution, if there is one, will be customized to the situation.
Even though we can't make broad generalizations about this category, it's helpful to know what percentage of people leave your organization for personal reasons to understand turnover and dig deeper into what the actual causes might be. "Personal reasons" can also be a cover for deeper problems in the organization when voluntary turnover rates are increasing overall or in a particular department or employee population.
Another job: In some instances, separation records indicate when an employee is leaving voluntarily for a different position. In others, these separations can be included in the "personal reasons" category above.
Transfer/relocation: Again, there is some crossover with "another job" and "personal reasons." This category generally applies to someone who has already accepted a new position and is planning on moving away from the current employer.
Here is the data on the most common reasons people leave (both voluntary and involuntary) comparing employees age 25 or under and employees age 55 or over.
In both age categories, the most common reason an employee voluntarily leaves a job is for "personal reasons." But workers age 25 or under are more likely to leave for another position while workers 55 and up are more likely to retire, which makes sense.
To get some deeper insights, ADP also created a data model based on a sample of 1,900 organizations (all with 1,000+ employees) and about 7 million employee records. The statistical analysis showed the most common factors that influence an employee's decision to leave are pay (and overtime), career opportunities and time/distance commuting. The ADP Research Institute® report, Revelations from Workforce Turnover. A Closer Look Through Predictive Analytics, offers a deeper look at the model and findings.
In addressing the reasons people leave your organization, start by evaluating what the organization can control. Then look at whether changing something for one employee creates the need to take a broader look at the issues across the organization. For example, raising the pay for one person or group can create potential gender pay issues.
Other factors are harder to manage. Most organizations can't do much about commute distance for employees. But if you're thinking about opening a new office or relocating the current one, paying attention to available housing and commute difficulty can save you employees, time and expense.
Download the report: Getting Your Retention Strategy Right
Read our Getting Talent Retention Right series: