Although the ideal employee turnover rate is 10 percent or less, rates have skyrocketed in recent years, jumping to roughly 47 percent in 2021 and remaining elevated in 2022, according to data from the U.S. Bureau of Labor Statistics. There’s a good chance your organization experienced some of this workforce loss. However, while some level of turnover is okay, you might want to pay close attention if your head count starts rapidly shrinking against your will.
There are many reasons why employees voluntarily quit their jobs, and one possible explanation boils down to, well, the fact that their co-workers did it first. Multiple people leaving your company can spark a serious ailment for your business: turnover contagion.
What is turnover contagion?
Similar to other terrible things that are contagious — illnesses, rashes, yawns — employee resignations can be contagious as well. Turnover contagion is when several employees quit working at an organization within a short period of time. The primary trigger for this resignation can be based on the fact that others on their team are quitting. People tend to mimic others’ behaviors, especially individuals close to them (e.g., co-workers). So, when employees start handing in their resignations one by one, it can elicit a mass exodus.
Although turnover contagion can be spurred by business leaders leaving an organization, it typically occurs when employees’ peers voluntarily resign.
People analytics company Visier found that employees are 9.1 percent more likely to resign if someone on their team voluntarily quits and 7.7 percent more likely to resign if someone on their team is involuntarily terminated. The likelihood shoots up to roughly 25 percent if the remaining employee was on a team of two.
How does turnover contagion impact businesses?
While employee turnover has always been an important workforce metric to track, its significance increases exponentially when your staff starts leaving in droves. Below are just a few of the side effects of turnover contagion.
- It’s expensive. You no doubt already know that recruiting and hiring new employees is expensive. So expensive, in fact, that the average cost of hiring one employee hovers around $4,700, per SHRM. It can take months to recoup those costs, and if the new worker you hire quits, it can put you further in the red (by 30 percent of the employee’s salary or more). Not only are you out monetarily when staffers quit, but replacing employees also takes a lot of time and resources.
- It can cause remaining employees to experience high levels of fatigue and burnout. Every time an employee leaves, someone else usually has to take on the responsibilities that person held. When several team members depart in close succession, those exits can leave an unwieldy burden on your remaining workers. The influx of added tasks and stress can lead to employee burnout, fatigue and, ultimately, more employee resignations.
- It can result in performance and productivity issues. As noted above, during turnover contagion, the employees who remain with your organization are rewarded with loads of additional tasks and projects, thanks to their colleagues’ departures … yay. In addition to potential burnout, it can result in poor performance and productivity issues among remaining workers.
Turnover contagion often rips through an organization quickly, leaving remaining employees scrambling to pick up the pieces. All the while, these staff members may not be skilled or properly trained on the types of responsibilities now on their plates, or they might simply rush through the tasks due to a lack of time. This increases your company’s chances of experiencing errors, bottlenecks and missed deadlines.
- It can crush morale and company culture. No one wants to see their work bestie quit, but it’s even worse when all of your co-workers (yes, even Susan from accounting) start dropping like flies. When work starts to feel less like a career and more like the Hunger Games, your employees may become defeated and disengaged. A mass exodus can spark insecurity and uncertainty about the organization, which may cause even more employees to start updating their resumes. [Read related article: How to Improve Employee Engagement]
One of these workforce issues alone can be cause for concern; when you combine some (or all) of them together, your HR manager will likely want to set their hair on fire — and find a contagion cure STAT.
There are several company culture metrics you can measure and track. If your company culture is suffering, check out these tips on transforming company culture.
How do you stop turnover contagion?
You obviously want to retain workers long term (OK, maybe just the good ones), so it’s essential that you take calculated measures to stop turnover contagion as soon as possible. There are no known vaccines for this ailment just yet, but we’ve identified four strategies you can use to help stop the spread.
1. Identify why turnover contagion is happening.
The best way to resolve a problem is to first understand why it’s happening in the first place. As soon as you notice multiple workers handing in their resignation letters, it’s time to address your employees open and honestly. And hurry — because turnover contagion spreads quickly. Visier reported that the most critical time to have those “stay-conversations” is within 135 days of the first team member’s resignation.
To learn why employees are voluntarily leaving, you can hold exit interviews with departing team members, asking a variety of exit interview questions that center around the “why.” You can also speak with current staffers about how they feel about your workplace. Once you identify the issues, you can work toward creating a solution.
2. Offer career development opportunities.
One of the primary reasons employees voluntarily quit their jobs en masse during the Great Resignation was because they found better career opportunities elsewhere. If you are diligent about providing personalized professional development opportunities and strategic career pathing for each individual employee, they may be more likely to stick around. Knowing they have the ability to grow within your organization can counteract some of the uncertainty caused by turnover contagion. [Get employee development and retention tips.]
It can also be helpful to create an employee mentorship program that connects employees with mentors within your organization. This gives employees someone to talk to about career needs and concerns. It also fosters connectedness to the company.
3. Recognize employees for their continued efforts.
When multiple employees leave an organization at once, the remaining staff is often forced to take on the responsibilities left behind, at least for a little while. That can be a challenge, as mentioned above. But even if performance is suffering, it’s still important to acknowledge the team that is still there that’s keeping your business afloat. As workers accomplish tasks and take on more projects, make sure they know their efforts are greatly valued. For example, you can make employees feel appreciated through personalized employee recognition programs.
4. Encourage employee feedback.
Gathering formal and informal feedback is a core element of managing a workforce, and it can be especially valuable if you’re trying to prevent or stop turnover contagion. Host a formal company-wide meeting to discuss the situation with employees. Also, encourage managers to consistently speak with their subordinates (in groups and one-on-one) to gain informal feedback about what changes need to be made. Some employees may be hesitant to voice their opinions during such a tumultuous time, so soliciting anonymous employee feedback via surveys can also be of value.
It won’t be easy, and some employees are going to quit regardless of what you do, but just know that turnover contagion can be mitigated. It’s important to remember, though, that once you find out why employees are leaving, you must actually take strides toward eliminating the problem for any chance at stopping the bleeding.