What Is Turnover Rate? Meaning, Formula & Importance in India
Book a Free DemoTurnover Rate
The percentage of employees who leave an organization during a specific period. Monitoring turnover rates helps identify retention challenges and improve HR strategies.
Turnover rate is the percentage of employees who leave an organisation during a specific period, usually calculated monthly or annually. It includes voluntary exits (resignations) and involuntary exits (terminations, layoffs).
In India, monitoring turnover rate is essential for understanding workforce stability, recruitment effectiveness, and employee satisfaction. High turnover often signals issues with workplace culture, compensation, or career development opportunities.
💬 “With Pagarai’s HR analytics, we identified why our turnover rate was high and reduced attrition by 15% in one year.” — Sneha, HR Business Partner
👉 Want to analyse and reduce attrition? [Get Pagarai’s turnover rate calculator →]
Turnover Rate Formula
| Step | Formula | Example |
| 1 | Average Employees = (Start of Period Employees + End of Period Employees) ÷ 2 | (100 + 90) ÷ 2 = 95 |
| 2 | Turnover Rate (%) = (Number of Exits ÷ Average Employees) × 100 | (15 ÷ 95) × 100 = 15.79% |
Bonus: In India, tracking voluntary vs. involuntary turnover separately gives deeper insight into HR strategy needs.
Why It Matters
- Helps identify retention challenges
- Reveals the effectiveness of recruitment and onboarding
- Impacts organisational costs and productivity
- Guides HR in improving employee engagement
- Supports workforce planning and forecasting
Common Tools for Tracking Turnover Rate in India
- HR analytics software: Darwinbox, Keka, Zoho People
- Excel / Google Sheets templates for manual tracking
- Pagarai HR Suite – for real-time attrition analytics and reporting
How Pagarai Helps
- Calculates turnover rates automatically
- Segments attrition data by department, location, and role
- Identifies reasons for exits through integrated surveys
- Provides predictive analytics to prevent high attrition
- Tracks retention metrics alongside recruitment KPIs
FAQ
Q1: What is a healthy turnover rate in India?
It varies by industry — for IT, under 15% is considered good; retail and BPO may see higher averages.
Q2: Does turnover rate include internal transfers?
No — turnover tracks only employees who leave the organisation entirely.
Q3: Can seasonal fluctuations affect turnover rate?
Yes — industries with seasonal hiring may see spikes during off-peak months.
Q4: How often should turnover rate be measured?
At least quarterly, with an annual review for trend analysis.
