Attrition rate and turnover rate are used interchangeably by most people and mean the same arithmetic: leavers over a period divided by average headcount over the same period. The formula is the easy part. What changes the answer, often by a factor of two, is which leavers you count and which headcount you divide by, and those are decisions rather than calculations. This page sets out the formula, the two decisions behind it, and the more useful question underneath, which is not what your attrition rate is but what the leavers you wanted to keep actually cost you. The free regretted attrition worksheet on this site works that from your own figures.
The turnover rate formula
Leavers in the period, divided by average headcount in the period, times one hundred. Average headcount is normally the mean of the opening and closing figures, or a monthly average if your headcount moved a lot. Calculating employee turnover annually is the usual choice because it smooths hiring seasonality, but a company that is growing fast should also run it quarterly, since an annual figure over a year in which headcount doubled divides by an average that reflects neither the start nor the end. Nothing in the formula is difficult. Every argument about the result comes from the two decisions below.
Which leavers count
The first decision is whether the denominator of a problem includes people who left involuntarily. A rate that counts dismissals and redundancies alongside resignations measures churn, which is useful for planning cover and useless for asking whether people want to stay. Most companies want two figures: total turnover for capacity planning, and voluntary turnover for the retention question. The second split matters more and is measured by almost nobody, which is regretted against unregretted: of the people who chose to leave, how many did you want to keep. A company can have a comfortable voluntary rate and be losing precisely the wrong people.
Which headcount you divide by
The second decision is who is in the denominator. Contractors, fixed term staff, seasonal workers and people on long term leave all change the number, and there is no universal right answer, only a consistent one. Write down which populations are in and keep it the same between periods, because a rate that moved because the definition moved is worse than no rate. If a meaningful part of your workforce is contingent, run the figure both ways, since the total talent mix worksheet on this site exists precisely because employees and contingent workers on one line tell a different story than employees alone.
The figure that is actually worth having
A rate is a comparison to your own last period and nothing more, since this site publishes no benchmark and a benchmark drawn from other companies would not tell you about yours. The figure with decisions attached to it is cost. The regretted attrition worksheet takes the leavers you wanted to keep, their salaries, and your own assumptions about replacement cost and the months of lost productivity, and returns what that group cost over the period. That number sits next to a development budget or a retention action and can be argued about on the same terms, which a percentage never can. Where you want national context for the rate itself rather than the cost, the JOLTS series linked below is the published US source.
Questions people ask about attrition rate
Is attrition rate the same as turnover rate?
In ordinary use, yes, and the formula is identical. Some companies reserve attrition for roles they do not backfill and turnover for all departures. If your company draws that distinction, write it down, because otherwise two people will calculate the same period differently.
What is the turnover rate formula?
Leavers in the period divided by average headcount in the period, multiplied by one hundred. Average headcount is usually the mean of the opening and closing headcount, or a monthly average where headcount moved substantially during the period.
What is regretted attrition?
The share of voluntary leavers the company wanted to keep. It is decided at the point each person leaves rather than reconstructed later, and it is the figure the retention conversation should be built on, because total turnover can look fine while the wrong people are the ones going.
What is a good attrition rate?
This site does not publish one, because a rate that is healthy in one industry and company size is alarming in another, and quoting a figure would mean asserting data we do not hold. Compare to your own previous periods and to the cost the worksheet returns.