Introduction: The Turnover Cost Calculation Spreadsheet is a powerful tool designed to help businesses understand the financial impact of employee turnover. It takes into account factors such as average salary and recruitment cost per employee to provide an accurate estimate of the total cost incurred when an employee leaves.
Formula: To calculate the turnover cost, the spreadsheet uses the following formula:
Total Turnover Cost = Total Employees × (Average Salary + Recruitment Cost per Employee)
How to Use:
- Enter the total number of employees in the ‘Total Employees’ field.
- Input the average salary per employee in the ‘Average Salary per Employee’ field.
- Provide the recruitment cost per employee in the ‘Recruitment Cost per Employee’ field.
- Click the ‘Calculate’ button to get the total turnover cost.
Example: For instance, if a company has 50 employees, an average salary of $50,000, and spends $2,000 on recruitment for each new hire, using the Turnover Cost Calculation Spreadsheet:
- Total Employees: 50
- Average Salary per Employee: $50,000
- Recruitment Cost per Employee: $2,000
After clicking ‘Calculate’, the result will be displayed as:
Result: Total Turnover Cost: $2,600,000.00
FAQs:
- Q: Can I use this spreadsheet for different currencies? A: This spreadsheet operates in US dollars (USD) by default. If using a different currency, ensure the values are entered in that currency.
- Q: What should be included in the ‘Recruitment Cost per Employee’ field? A: Include any expenses related to the recruitment process for each new employee, such as advertising, interviewing, and onboarding costs.
- Q: Can I use this spreadsheet for seasonal or temporary employees? A: Yes, you can input the total number of seasonal or temporary employees in the ‘Total Employees’ field.
- Q: Does this spreadsheet account for lost productivity during the recruitment process? A: No, it focuses on direct financial costs associated with employee turnover.
- Q: Can I customize this spreadsheet for my specific industry or company? A: Yes, you can modify the input values to suit the specifics of your business.
Conclusion: The Turnover Cost Calculation Spreadsheet is an invaluable resource for businesses to gain insights into the financial implications of employee turnover. By factoring in factors like average salary and recruitment costs, it provides a comprehensive view of the true cost. Use it to make informed decisions about hiring and retention strategies.