How Much Does Employee Turnover in Health Care Cost Your Business?

Regardless of the size of your business, employee turnover is a significant concern. It might be cutbacks, employee dissatisfaction, or something else causing problems. No matter the cause, if it becomes a frequent occurrence, it will seriously impact your business. So how much does employee turnover in health care cost your business, why does it happen, and what can you do about it?

Why Health Care Employees Leave Their Jobs

There are multiple reasons that health care employees choose to leave their jobs. Other than leaving to enjoy their hard-earned retirement, the grounds for departure are typically negative. Here are reasons that health care employees usually decide that enough is enough:

  • Long hours
  • Heavy workloads
  • Rising demand for care
  • Too much responsibility
  • Damage to well-being
  • Non-flexible hours
  • Poor culture fit

It’s no mystery that health care organizations are at the top of the employee turnover list. It’s a tremendous problem and an expensive one. According to Becker’s Hospital Review, since 2013, the average hospital has turned over 85.2% of its workforce. This number puts health care second only to hospitality for the highest industry turnover rates. The outcome is a tremendous financial strain on health care providers who are constantly trying to source and train new employees.

Direct and Indirect Costs

High turnover rates negatively impact health care providers, staff, and patients. The direct costs of high health care turnover include:

  • Candidate sourcing and recruiting
  • Staff orientation and training
  • Costs of worker termination

There are indirect costs associated with high health care employee turnover too. Productivity diminishes, and staff morale is low. There is increased work for the teams that lose a staff member and an overall reduced work/life balance while they wait for replacements. Turnover impacts patient quality of care and the reputation of a hospital or community health care provider as well. A shortage of health care staff affects patient care outcomes because there is not enough staff to respond quickly. This turnover cycle can create a problem where health care organizations have trouble attracting talent, as staff are constantly rolling in and out through a revolving door.

The High Cost and How to Stop It

The actual cost of health care turnover varies, but studies suggest that it can run as high as 150% of the annual salary of mid-level employees. If the salary is $50,000 annually, the average cost of an employee leaving is $75,000. If a provider has 300 employees with a 10% turnover rate, the annual fiscal cost is estimated to be more than 2 million. So how do you stop this high turnover rate?

  • Be intentional when hiring
  • Offer flexible work schedules
  • Prioritize onboarding and training
  • Give meaningful recognition
  • Provide career development and continuing education

An excellent solution to health care staffing shortages is partnering with Arbor Associates. The staffing professionals at Arbor Associates can provide per diem, contract, or direct hire staff for your organization and help end the cycle of high-cost turnover rates. Let us help you by contacting us today!