It’s April and everyone is talking about the Great Reshuffling of Talent or the Great Resignation and 2022 continues to see a staggering number of job openings versus the number of people in the labor market.

I think the HR Magazine for the Society for Human Resource Management (SHRM) said it best.

“As we enter the year 2022 this is Year 3 of the Pandemic - CEOs and HR executives across the country are feeling the turnover pressure like no other time before”.

As a recruiter, I am hearing it firsthand in the calls and referrals coming into our office. It appears almost universal that everyone is getting touched by turnover and staffing is one of the primary concerns in this post covid employment market.

The U.S. Bureau of Labor Statistics (BLS) reported the economy added 431,000 jobs in March. Unemployment continued to decline, now reported at 3.6 percent. Among the college-educated civilian workforce, the unemployment rate was 2.0 percent indicating a continued tight labor market.

According to CNBC as of January, there were roughly six jobseekers for every 10 openings — or nearly two open roles for every available worker. Recruiters are fighting to hire for historically high openings and backfill for people moving to new jobs.

I wanted to review again the importance of knowing how you stand in terms of retention rate and also how quickly you are filling open positions.

BILL O’MALLEY’S INSIGHT AND RECOMMENDATION:

Most companies do not currently track the days to Hire or Time to Fill. Below is a simple formula that the HR team or your hiring authority can use to determine how quickly your key positions are being filled.

Here is the format of a simple tracking worksheet that can be set up in minutes.

Time to Fill (Tracking Worksheet)

Time Days to Hire – this is # of days the opening or requisition is approved to the time an offer is accepted or signed.

Time Days to Fill – This is the date the opening occurs or is approved for the start date.

From my point of view if you’re a small to medium-size business with a small HR department or staff the Days to Fill number is the number to focus on. I believe this is your $ money number to track.

Every day an opening is left unfilled = lost productivity and sales.

If it takes 26 days to fill each job opening, how much productivity and lost sales (customers not greeted) are you experiencing in those days when understaffed.

These lost potential sales can be staggering.

In your other work segments including the Warehouse, Office, and Buying or sales support areas…every day that an opening is unfilled will generally mean you are spending over time. This also means that added stress and workload have been shifted and your current staff picking up more share of the workload. This often contributes to more turnover in those areas.

TIP: Measuring and tracking your time to fill and turnover and reviewing it constantly as a Key Performance Indicator (KPI) will benefit nearly any business.

This is especially true for those dependent on engaging the consumer in product sales and demonstrations i.e., Furniture, Appliances, and Sleep Centers.

The other key people metric to track is your employee TURNOVER RATE. It’s really much easier to track and in fact, most companies have the ability to pull the data from payroll.

I am always taken aback when I speak to CEOs or HR executives that do not measure or have a grasp of what their Employee Turnover rate really is.

HERE IS A SIMPLE CALCULATION TO USE TO PROVIDE A TURNOVER FORMULA:

The turnover rate is calculated by taking the number of separations during a month divided by the average number of employees, multiplied by 100:

Turnover Rate = # of Separations / Avg. # of Employees x 100

So why is tracking turnover so important, take a look at this chart below to see the gravity of the turnover.

Turnover Formula

Many of you when you first looked at the above it doesn’t appear that turnover is an issue. Once you look at the cascading effect that one or two resignations a month have on an annual turnover rate you realize that nearly your entire staff has turned by the end of the year. This leads to constant training and stress on your employees and leaders.

My recommendation on solving turnover is to focus on the metrics including “Time to Fill” and your monthly, quarterly and annual “Turnover Rate” trends. If you do this while focusing on your people and communication like never before, you’ll have a better opportunity at turning the tide.

COMING NEXT MONTH:
YOUR HOW-TO GUIDE ON CONDUCTING STAY CONVERSATIONS

Bill O’Malley is President of Connector Team Recruiting a firm headquartered in Charlottesville, Virginia specializing in the Furniture | Appliance and Sleep verticals. Connector Team is a full-service Search Firm offering permanent placement recruiting and interim staffing solutions.

Feel free to contact Bill at bill@connectorteamrecruiting.com.

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