Get to know the meaning of employee movement, the formula for calculating and examples.

Employee movement definition, formula and examples

Assessing movement of employees is essential for any organization. The most basic employee movement definition encompasses the transfer of employees from an organization to another. It provides insights about the health of the company pertaining to employee satisfaction and engagement levels. If a large number of employees are leaving the organization to find better terms and conditions, it can derail business growth. Hence, it is crucial to conduct an assessment on the movement of employees regularly.


How to calculate employee movement

Mostly, employee movement is best captured by calculating turnover rates. Employee turnover refers to the movement of employees from a company, which calls for replacement with new hires. The turnover is computed by dividing the number of employees who have left within a specified period by the number of employees who were working for the organization, multiplied by 100. Often turnover rates are expressed in percentages. For example, if 10 people left the organization in the past three months, and within the time, there were 100 employees the turnover rate, in this case, would be 10%.

Next, the retention rate is also used to determine employee movement. This is defined as the number of employees who remain in the company over a given time. To calculate retention rate, divide the current number of employees by the number of employees at the beginning of the period, and multiply with 100. You can choose a measurement period, which you deem appropriate but most businesses conduct the exercise annually. For example, if you have 400 employees currently and you had 450 employees at the starting of the year, the turnover rate is 400/500*100=80%. This indicates that 20% of the employees have moved from the organization due to various reasons.

Another metric for assessing employee movement is voluntary turnover. This occurs when employees leave the company voluntarily due to poor work conditions. There is also the involuntary turnover, where the employer dismisses the employees due to misconduct or poor performance. Voluntary and involuntary metrics are crucial indicators of issues plaguing teams at workplaces.

In addition, you should measure the rate at which high performers exit your business. To do this, calculate the retention rate of high performers. These employees demonstrate the right work attitude, and they are a good influence on their colleagues. You need to maintain these key talents. However, if you are not able to motivate, recognize, and appreciate them, they are bound to move to other companies.