How to Calculate Staff Turnover: Formula & UK Benchmarks

Somewhere between the third exit interview of the month and the Slack message that starts "just wanted to give you a heads up before it goes to the team," most leaders start uneasily wondering the same thing: is this normal, or is something really wrong with this company?

The annoying truth of it is that you cannot answer that from a feeling. "It feels like everyone's leaving" is not a metric, it's a 3am-can't-sleep-intrusive-thought. What you need is a number, and thankfully it takes about thirty seconds to work out, once you know how to do the maths. So here's the formula, with the UK benchmarks to hold it up against to find out whether your leadership and HR teams should be worried.

The staff turnover rate formula

Refreshingly, this one has none of the mystery that HR jargon usually insists on:

Turnover rate = (Number of employees who left ÷ Average number of employees) × 100

To get your average headcount, add the number of employees you had at the start of the period to the number you had at the end, then divide by two:

Average headcount = (Employees at start + Employees at end) ÷ 2

A worked example

Say you started the year with 120 people and ended it with 114. Over that year, 18 people left (some of those seats were backfilled along the way, which is why your headcount didn't simply drop by 18).

• Average headcount = (120 + 114) ÷ 2 = 117

• Turnover rate = (18 ÷ 117) × 100 = 15.4%
  

That's genuinely it. No advanced stats degree, no consultant required.

A few things worth getting right before you go near a spreadsheet:

• Decide what counts as a "leaver." Most organisations lump voluntary departures (resignations) and involuntary ones (redundancies, dismissals) into a single headline figure, then break the two out separately once they actually want to understand what's going on. Skip that second step and you can end up hiding a genuine retention problem behind a restructure, or the other way round.

• Pick a consistent time period. Monthly figures bounce around too much to mean anything on their own, they're basically noise wearing a metric's clothing. Quarterly is useful for catching trends early; annual is the number most people benchmark against.

What's a "good" staff turnover rate? (UK benchmarks)

The thing that everyone needs to know - what does 'good' look like? The honest answer is: it depends significantly on what you do for a living.

According to CIPD's most recent analysis, the UK's national average annual turnover rate sits at around 15% (Spring 2025), a slight improvement on the year before. But that single tidy figure hides a lot of unsightly mess beneath. CIPD's sector analysis of ONS Annual Population Survey data (2022–23, the latest full sector breakdown available) puts turnover as low as 25% in public administration and defence and as high as 52% in hospitality, one of the widest spreads you'll find in workforce data anywhere.

Roughly speaking, it breaks down like this:

• Low turnover sectors (10–20%): public sector, education, utilities, professional services

• Mid-range (20–35%): tech, professional and business services, construction

• High turnover sectors (35%+): hospitality, retail, accommodation and food service, logistics
  

So if you run a hospitality business sitting at 45% and you're panicking that you look nothing like a 15% accountancy firm, take a breath. Context matters more than the raw number, and comparing yourself to an industry that isn't yours is a bit like being annoyed you didn't win a marathon you weren't competing in.

What actually matters more than the national average is comparing yourself to your own history and your closest sector peers. A steady climb over three consecutive quarters tells you far more than any single snapshot, however alarming that snapshot looks.

Why the number actually matters

Turnover isn't just a metric you report upwards and then quietly forget about until next quarter. It's expensive, and not in a vague "culture cost" way, in a very real, very bank-account-shaped way.

UK estimates put the average cost of replacing an employee somewhere between £25,000 and £30,000, once you factor in recruitment, onboarding, lost productivity and the ramp-up time it takes a new hire to reach full speed. That's before you count the disruption to the team left behind, who are now doing two jobs and secretly wondering if they're next.

There's also a very human reason high turnover gets ignored longer than it should: nobody wants to be the one who flags it. Sunk cost thinking creeps in ("we've already invested so much in this team, surely it'll settle down") and the number gets explained away exactly the way an individual explains away their own unhappiness at work, one reasonable-sounding excuse at a time. Which means a turnover rate that looks like "just a number" on a slide is, in practice, a fairly serious line item that most P&Ls never explicitly show, and a signal most leaders talk themselves out of taking seriously until it's expensive.

What to do if your number is higher than you'd like

A high turnover rate isn't a verdict on you as a leader, it's a diagnostic. Here's where to actually look:

1. Separate voluntary from involuntary departures. These need completely different responses, and lumping them together tells you nothing useful.

2. Look at exit data by team, not just company-wide. Turnover is rarely evenly spread. It usually clusters hard around a specific manager, team or role, and the company-wide average will happily hide that from you.

3. Check what's happening to the people who stay. If your best people are the ones leaving, that's a very different, much more urgent problem than general attrition among newer joiners.

4. Don't skip the transition itself. If redundancies or restructuring are part of what's driving your number, how you handle that process has a measurable effect on both the people leaving and the people watching them go, and on whether the ones who stay start quietly polishing their CVs at lunchtime. We've written about that in more detail in how to support employees through redundancy and supporting employee mental health during organisational change.

If turnover in your organisation is being driven by restructuring, redundancy or genuine organisational change, that's exactly the territory Waddyado works with organisations in directly, with psychology-led outplacement support that protects both the people leaving and your employer brand in the process. There's also a free redundancy checklist if you're heading into that process and would rather not find out what you missed after the fact.

FAQ: Calculating staff turnover

What's a good staff turnover rate for a small business? There's no separate formula for small teams, but the maths gets noisier at low headcounts, one senior leaver in a team of ten looks dramatic on paper even if it's an entirely normal departure. Track trends over several quarters rather than reacting to a single number.

Should redundancies count in my turnover rate? For your headline figure, yes, they're still departures. But always break voluntary and involuntary turnover out separately afterwards, otherwise a restructuring year can make it look like you have a retention crisis when you don't (or vice versa).

How often should I calculate turnover rate? Monthly for internal monitoring if you have the data, but treat monthly figures as noisy. Quarterly is the sweet spot for spotting genuine trends; annual is what you'll use to benchmark against sector averages.

Is a 0% turnover rate a good thing? Not necessarily. Some turnover is healthy, it brings in new skills and perspectives, and a rate of genuinely zero over a long period can sometimes point to stagnation rather than a thriving, loyal team.

The bottom line

Your staff turnover rate takes about thirty seconds to calculate and tells you more about the health of your organisation than most quarterly engagement surveys combined. Work it out, benchmark it honestly against your sector rather than the national average alone, and treat a high number as the start of an investigation, not a slide to quietly bury and hope nobody asks about.

If turnover in your organisation is being driven by redundancy, restructuring or change you'd like support navigating, get in touch with the Waddyado team to find out how our outplacement packages work.