WORK PLACE STATISTICS- The cost of turnover, loss of productivity and absenteeism.

Below are some Workplace statistics that show you the cost of turnover, loss of productivity and absenteeism.

The cost of turnover in the workplace is extraordinary. Ernst & Young reports that the cost of losing and replacing an employee may be as high as 150% of the departing employee’s annual salary. ( The cost of turnover also includes the manager’s time training new employees.

• Research shows that 60-80% of all difficulties in organizations come from strained relationships between employees, not from deficits in individual employee’s skill or motivation. Daniel Dana, Managing Differences: How to Build Better Relationships at Work and Home (2005, 4th ed.); Barbara J. Kreisman, Insights into Employee Motivation, Commitment and Retention (2002)

• Productivity losses related to personal and family health problems cost U.S. employers $1,685 per employee per year, or $225.8 billion annually. (Stewart et al., 2003)

Cost of turnover

• $700,000 is the average jury award in wrongful termination lawsuits

• The typical manager spends 25-40% of his or her time dealing with workplace conflicts. That’s one to two days of every work week. (Washington Business Journal, May 2005).

Workplace Stress & Mental Health

• Two-thirds of both men and women say work has a significant impact on their stress level, and one in four has called in sick or taken a “mental health day” as a result of work stress. (American Psychological Association, 2004)

• One-fourth of employees view their jobs as the number one stressor in their lives. (Northwestern National Life)

• Workplace stress causes approximately one million U.S. employees to miss work each day. (American Institute of Stress)

• Problems at work are more strongly associated with health complaints than are any other life stressor. (St. Paul Co.)

• Workers who must take time off work because of stress, anxiety, or a work conflict will be off the job for about 21 days. (US Bureau of Labor Statistics)
• American employees used about 8.8 million sick days in 2001 due to untreated or mistreated depression. (National Committee for Quality Assurance, 2002)

• Indirect costs of untreated mental health disorders results in a $79 billion annual loss to businesses due to loss of productivity and absenteeism. (U.S. Surgeon General’s Report on Mental Health, 1999)

The cost of turnover, loss of productivity and absenteeism in organizations due to conflict is huge. To avoid these statistics, be a proactive manager.

When organizations make it a priority to train employees on communication/listening skills, building trust, teambuilding, and conflict resolution skills, less unresolved conflicts will occur. When employees feel their concerns are heard by management,  job satisfaction and productivity increases which goes right to an organization’s bottom line.

There are a number of steps to be taken to reduce the cost of conflict and improve operations:

  1. Institute company-wide conflict resolution and communication skills trainings.

  2. Encourage problem solving and authentic conversations on your team.

  3. As a manager, watch out for hidden conflict. Look at body language and employees who start shutting down in meetings.

  4. Don’t let conflict build up. Once you notice that there might be a conflict on your team, ask questions. (How are you doing? Do you need support with anything? I have noticed in the past month that you seem to be quiet in meetings. Is there anything going on that you would like to talk about?)

  5. Set up regular meetings with your employees.  Ask for their feedback on how things are working.  Ask them what support they need.

  6. Brainstorm with your employees to come up with win win solutions.

  7. Care about your employees.  Go the extra mile to improve employee morale.  Be the kind of manager who employees want to be around.  Watch your own stress levels.  Your stress can easily get passed on to your employees.

  8. If the employees can’t resolve a conflict on their own or with your help, hire a mediator to be a neutral third party to help. The cost of a mediator is nothing compared to the cost of unresolved conflict.


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