Company Size (A)
Average Salary (B)
Turnover Rate (C)
Your Total ROI
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TURNOVER COST + ABSENTEEISM COST
In a 2022 article, PeopleKeep states that some studies predict that every time a business replaces a salaried employee, it costs an average of 6 to 9 months. (which is between 50% and 75% of their annual salary - based on US Statistics)
Let's use the mean : 62.5%.
( A x C ) x ( B x 0.625 )
In 2021, according to the U.S. Bureau of Labor Statistics, the average absenteeism rate was 3.2%. In other words, with approximately 240 workdays per year (varying per country & company), the average US worker missed an average of 7.6 workdays throughout the year.
( ( A x B ) / 240 ) x 7.6
Studies have shown that when investing between 1-3% of payroll in employee engagement, businesses have experienced up to 41.5% lower turnover rates as well as up to a 41% decrease in employee absenteeism.
Let's use 1%.
( A x B ) x 0.01
TURNOVER SAVINGS + ABSENTEEISM SAVINGS
According to a Gallup Workplace report, high-turnover ( >40% ) businesses with engaged workforces have shown up to 24% lower employee turnover rates, whereas low-turnover ( <40% ) businesses achieved up to 59% lower turnover rates. This averages out to a 41.5% turnover rate reduction.
And lets continue with 62.5% of salary for the cost (based on turnover costs).
( ( A x B ) x 0.625 ) x ( C x 0.415 )
According to a Gallup Workplace report, businesses with engaged workforces have lower employee absenteeism rates by up to 41%.
With the average U.S. worker missing 7.6 workdays throughout the year (based on Absenteeism costs), this would mean a highly engaged US worker would have missed 4.5 missed work days throughout the year, 3.1 fewer work days than the average (1.7% absenteeism rate).
( ( A x B ) / 240 ) x 3.1
PREDICTED SAVINGS - SUGGESTED INVESTMENT
Applauz helps you engage, recognize, and reward your best employees
Make work a happier place.
7675 Saint Laurent Blvd,
Suite 201,
Montreal, Quebec,
CA, H2R 1W9
1 833 277 5289
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