Reducing Turnover, Reducing Costs

Reducing Turnover, Reducing Costs

In 2012, the Center for American Progress released a study looking at the cost of turnover within corporations.  The research revealed the extreme costs that companies are taking upon themselves when they lose an employee. The article explains, “Among positions earning $30,000 or less, which includes more than half of all U.S. workers, the cost of replacing an employee is slightly less than among positions earning less than $75,000 annually. The typical cost of turnover for positions earning less than $30,000 annually is 16 percent of an employee’s annual salary.” This issue becomes more extreme in both the hospitality and food industry, which shares the highest number of workers quitting their jobs annually.  Both of these sectors have a voluntary quit rate of 37%. Companies must find a way to retain their workers if they hope to turnover cost low within their companies.

At Skylab Learning, we have created a solution to help reduce turnover within a company. The study explained the biggest reason for the high quit rates within these sectors is due to poor pay and workplace benefits. By allowing your workers to learn English you are investing in their future thus creating loyalty. Many of these lower skilled workers have the ability to grow within the company and take on greater responsibility but their English skills become a roadblock. When their company begins to teach them English they will feel as if they have the ability to move up the corporate ladder. This will increase both motivation and loyalty to the company thus reducing turnover.  Furthermore, a company is now able to hire from within using an employee who knows the system, creating a better work environment and smoother production.


  • jesse | Nov 12,2014