Health Care Industry Annual Turnover Rate About 32%

The health care industry is experiencing roughly 32% turnover annually, of which about two-thirds represent “voluntary separations.”  Health centers realize turnover is a significant problem, and a difficult one to tackle.  While everyone wants to reduce turnover, many organizations don’t know what a typical turnover level is – making it difficult to know if your efforts are succeeding.  Merces includes turnover data in our surveys, but the health care market is much broader, and large sample data of this type can be helpful.

The Bureau of Labor Statistics provides data on job openings, hires, and separations in its JOLTS study, produced monthly.  The May 7, 2019 Economic News Release provides some information that health centers may find useful:

  • There are currently more job openings than there are job seekers.  This means you can expect a longer “time to hire” for nearly all openings, as there is competition throughout the market.
  • Health care “hire rates” are averaging about 3%/month over the last year (36% for the year).  That means that every month the industry has been hiring about 3 new employees for every 100 currently on staff.  Remember that these numbers also include growth, not just replacements for staff that leave.
  • “Total Separations” are occurring at a rate of about 2.7% in health care (32% for the year), compared to about 3.7% (44%) overall.
  • “Voluntary Separations” in health care are averaging about 2.0% (24% annually), somewhat lower than the 2.3% (28%) in general industry.  The balance of separations are layoffs and discharges.

What does all this mean for health centers?  Total turnover data is good to look at, but because almost a third of turnover is involuntary, total turnover partly represents how good you are at hiring – finding people who you will not need to terminate down the road.  The better “apples to apples” comparison for retention is voluntary separations, representing your ability to keep staff.  Bringing your voluntary turnover down to the 24% industry level is certainly a start, but your target should be much lower.

How to start?

  • Classify your turnover by voluntary and involuntary.  High involuntary turnover levels suggest you may need to improve your hiring or promotion processes.  High voluntary turnover means there is something about the employment relationship that hasn’t been optimized.
  • Break down your turnover by job and job family.  Losing one provider when you have ten is not a high percentage (10%) but can result in a devastating loss of productivity.  Averaging low turnover in some functions with high turnover in others may make your overall picture look better than it really is.
  • Break down your turnover by the reasons people are leaving.  Remember that the reason people may say they are leaving may not be the real reason.  The easiest thing to say is that you’re leaving for better pay or benefits , because people don’t want to burn bridges.  Look to see if turnover is higher in certain departments, or in particular clinics.

Once you have a handle on where your turnover is coming from, and why people are leaving, you can start a systematic approach to bringing your turnover down.

About Edmund B. Ura

Edmund B. Ura, MAIR, JD, works with governing boards, executives and human resources staff to develop methodologies for ensuring fair and equitable compensation programs that support achievement of organizations' missions. Contact Ed at ebura@mercesconsulting.com.
This entry was posted in Compensation, Organization, Performance Management, Staffing and tagged , . Bookmark the permalink.

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