Tracking Employee Retention

Steven Cesare, Ph.D.

A landscaper from Georgia called me the other day to talk about compensation issues.  During that conversation, I suggested the company offer divisional managers a monthly bonus for meeting employee retention goals.  After differentiating between employee turnover and employee retention, I suggested the landscaper review the 2019 company payroll system in order to generate baseline data for establishing realistic goals.  The following Table summarizes actual tracking of employee retention for Laborers and Foremen for each month during 2019. 

 

2019

 

Laborers 

Foremen 

  Begin End Retention Begin End Retention
January 11 9 82% 7 6 86%
February 12 10 83% 6 5 83%
March 11 11 100% 7 7 100%
April 16 12 75% 7 7 100%
May 12 9 75% 7 7 100%
June 13 11 85% 7 7 100%
July 13 11 85% 7 7 100%
August 11 11 100% 7 7 100%
September 13 11 85% 7 7 100%
October 13 11 85% 7 7 100%
November 11 9 82% 8 8 100%
December 10 7 70% 8 7 88%
Annual 11 6 55% 7 5 71%

The number in each cell under “Begin” represents the number of employees in that job classification who were on the company payroll on the first day of each month.  The number in each cell under “End” represents the number of those same employees who were on the payroll system BOTH at the beginning of the month AND at the end of that same month.  

As shown, 11 Laborers were employed by the company on January 1, 2019; of those 11 Laborers, 9 of them were still employed by the company on January 31, 2019.  This “cohort” analysis, tracks only a defined group of employees for a given time period (January 1st through January 31st); it is not tracking all Laborers employed during January.  Thus, the January 2019 Employee Retention Rate for Laborers was 82%.

Based upon the data shown in the Table, sometime during January, three additional Laborers were hired, which defines why there were 12 Laborers on the payroll on February 1st (Begin); of those 12 Laborers, 10 were still employed on February 28th (End).  The February 2019 Laborer Retention Rate was 83%.

Similar methodology is in place for the Annual entry.  As we already know, there were 11 Laborers on the payroll system at the beginning of January (Annual Begin).  Of those original 11 Laborers, only 6 of them were still employed on December 31st 2019 (Annual End).  The Annual 2019 Laborer Retention Rate was 55%; only 6 Laborers remained employed for the entire 2019 year.

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Steve Cesare Ph.D.

Steve Cesare Ph.D.

has more than 25 years of Human Resources experience. Prior to joining The Harvest Group, Steve worked with Bemus Landscape, Jack in the Box, the County of San Diego, Citicorp, and NASA. Steve earned his Ph.D. in Industrial/Organizational Psychology from Old Dominion University, and has authored 34 human resources journal articles. As a member of The Harvest Group, Steve’s areas of expertise include: staffing, legal compliance, wage and hour issues, training, and employee safety.  Read Steve's full bio.