The True Cost of Turnover

Decoding the Financial and Intangible Impacts of High Attrition in Call Centers

Attrition, or employee turnover, is a major concern for call centers and contact centers, as it can significantly impact both their financial performance and their ability to provide high-quality customer service. When attrition rates reach 100%+ annualized, it means that, on average, the center is losing more than one employee per year for every position they have, which is a very high rate.

We must consider the various costs associated with employee turnover to compute the total costs of 100% annualized attrition for a 100-seat call center with an average wage of $15.00. Here are some of the expenses that we need to consider:

Here’s an example:

If we have 100 employees at an average wage of $15.00 per hour and an attrition rate of 100%, we can estimate the total costs of turnover as follows:

Adding up all these costs, we get a total cost of turnover of $980,500.

What if I outsource?

We can hear the objection, “I outsource and don’t pay for attrition costs, this is the burden of the vendor.” While we have outlined the hard costs, there may be hidden costs associated with high attrition rates that are not immediately apparent that are impacting your business, including:

In summary, a 100%+ annualized attrition rate for a contact center or call center can have significant hard and hidden costs, including recruitment and training expenses, reduced productivity, lost revenue, reduced customer satisfaction, lower employee morale, impact on company reputation, and loss of institutional knowledge. Even if you outsource and aren’t subject to many of the hard costs, we can assure you the hidden costs are greatly impacting your business. It is crucial for call center managers to develop effective strategies to retain their employees and reduce attrition rates to avoid these negative impacts.

We have included a simple, free, Excel tool you can use to calculate your cost of turnover.

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