{"id":2971,"date":"2025-06-03T15:31:42","date_gmt":"2025-06-03T19:31:42","guid":{"rendered":"https:\/\/www.dailypay.com\/2017\/07\/10\/employee-retention-rate\/"},"modified":"2026-03-23T10:22:59","modified_gmt":"2026-03-23T14:22:59","slug":"employee-retention-rate","status":"publish","type":"post","link":"https:\/\/www.dailypay.com\/resource-center\/blog\/employee-retention-rate\/","title":{"rendered":"What Is the Average Employee Retention Rate by Industry? (2025 Update)"},"content":{"rendered":"\t\t
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Employee turnover or attrition can be expensive for companies. This high churn of employees results in lost productivity, increased recruiting costs, training costs, and more.\u00a0<\/span><\/p>\n

Retention Rate vs Turnover Rate\u00a0<\/span><\/h2>\n

Employee retention rate and employee turnover rate are basically two sides of the same coin. These rates are metrics organizations use to measure aspects of employee stability and movement, but they focus on different aspects of the workforce.<\/span><\/p>\n

What is an Employee Retention Rate?\u00a0<\/span><\/h3>\n

Employee retention rate measures the percentage of employees staying at a company over a period of time. It is typically calculated by dividing the number of employees who have stayed with the company over a certain time period by the number of employees at the start of the period, then multiplied by 100.\u00a0<\/span><\/p>\n

A high retention rate indicates that many employees are staying with the company, which can signify a positive work environment and effective management practices.<\/span><\/p>\n

What is an Employee Turnover Rate?\u00a0<\/span><\/h3>\n

In contrast, employee turnover rate measures the percentage of employees who leave a company over a specific period of time, whether voluntarily or involuntarily. You can calculate your employee turnover rate by dividing the number of employees who left your company during a specific period by the average number of employees at your company during the same period, and then multiplying by 100.\u00a0<\/span><\/p>\n

A high turnover rate might indicate issues such as dissatisfaction with the workplace, poor job fit, or external factors like competitive job markets.<\/span><\/p>\n

The Importance of Employee Retention and Turnover Rates\u00a0<\/span><\/h2>\n

Understanding both rates can help an organization address workforce management issues, plan for future hiring needs, and improve the overall workplace environment and policies.<\/span><\/p>\n

This makes measuring employee turnover rates more critical for employers.<\/span><\/p>\n

You likely have a few questions about <\/span>employee retention<\/span><\/a> in your industry.\u00a0<\/span><\/p>\n